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.