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Nathan Baker

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Study shows upswing in state housing market

August 14th, 2013 8:53 am by Nathan Baker

Study shows upswing in state housing market

New homes are under construction in "The Meadows," a housing development off Ben Gamble Road in Jonesborough. (Tony Duncan/Johnson City Press)


Tennessee’s housing market gained ground in the second quarter of 2013, outpacing the South as a region and the rest of the country in terms of new construction even as employment and other economic indicators cooled.


According to a study released Monday by Middle State University’s Business and Economic Research Center, permits for single-family homes in the state rose by 7.8 percent from the first quarter of this year to 16,200 units, the highest level in five years.


Multi-family units more than doubled from the previous quarter, rising to 9,400 units annualized.


The construction activity beat the South’s 4.8 percent increase and the 4 percent gain posted by the U.S. as a whole.


The state’s capital continued to lead in home sales, as sales in the Nashville metropolitan statistical area rose 4.4 percent and inventory fell, causing the inventory-to-sales ratio to fall to just 4.7 months’ supply.


In the Memphis area, inventory fell to a 6-month supply, while Knoxville has a 13-month supply of homes on the market.


Home prices rose just 0.9 percent over the year, but the Kingsport-Bristol metro area saw the third-highest price increase of 2.2 percent.


Johnson City’s home prices appeared to have cooled, increasing only 0.1 percent over the year after rising 4 percent in the previous year.


Past due mortgages saw little change statewide, according to the BERC report, dropping to 9 percent of total mortgages, only a 0.1 percent decrease from the first quarter, and have shown little change during the previous 18 months.


New foreclosures also stayed relatively flat, hovering below 1 percent. New foreclosure starts are now at their lowest level since 2007, however.


The BERC concluded that the combined indicators point to an improving housing market in the state, and forecasts a more stable footing for housing in the state if job growth and economic activity forecasts hold true.

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