Is it a buyer’s or seller’s market? Knoxville expert breaks down area’s current housing market
KNOXVILLE, Tenn. (WATE) — Spring is one of the busiest times of year for the housing market. One question many in East Tennessee and the Knoxville area are wondering is how the market will progress in 2023.
“The leverage has really equalized,” Sale began. “I would still characterize today’s market as definitely favored towards or having an advantage towards the sellers, but buyers do have more leverage than they did last spring.”
Sale also shared that it depends largely on the home price point a buyer is looking for. He said for buyers in the $300,000 mark or below, it will still be extremely competitive, filled with multiple offer situations where buyers may need to go in over the asking price. On the other side, Sale said buyers shopping for homes above $300,000 would have more leverage.
Given the circumstances, Sale called this a tight, but strong housing market.
Sale is the Government Affairs and Policy Director for the KAAR. He said aside from inventory, interest rates have weighed heavily on housing affordability. He hopes government officials and community leaders can work to add more housing to the area, calling housing the backbone of the economy.
“We need people to work at the grocery store, work at the pharmacy, work at the doctor’s office and they have to be able to live somewhere, so solving this problem spans every sector and industry of the economy,” he said. “Without housing, we can’t continue to grow as a city unless we want to be rapidly unaffordable.”
Sale also shed some light on the situation for renters moving forward, saying right now the area is seeing a record number of apartments being built.
“Prior to the pandemic, in any given quarter, we would have around 700 units that were under construction,” said Sale. “Today that’s almost 2,400, so we are seeing a lot of apartment units, which is really great news for renters.”
While the increase in construction does not mean renters will see rent prices drop, it could cause hikes driven by demand to slow down. Sale said he felt this was promising after occupancy rates peaked at about 99% throughout the height of the pandemic. He added these additions will make it easier for renters to navigate, which will be crucial to meeting labor market needs as the area grows.
At the end of May, KAAR will release its state of housing report, which is a comprehensive look at the real estate market in Knoxville and east Tennessee.