KNOXVILLE, Tenn. (WATE) — Home sales are slowing just a bit in the East Tennessee area, according to certified housing and economics expert Hancen Sale, but the occupancy rate of rental housing remains high.
In this week’s Money Talks, Sale discussed the current state of the East Tennessee housing market. Sale is the Government Affairs & Policy Director, Knoxville Area Association of Realtors.
“Home sales are starting to decline,” Sale said. “We’ve seen the rapid increase in interest rates really made affordability a problem. So, it has pushed home sales down. That’s typically been the case in years past, but I think we will start to see that taper off a little bit and we’ll start to see home sales stabilize.”
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He elaborated on how the housing market numbers in July went down about 10% and price pressure growth also moderated.
“We need to keep prices in control, it’s a good thing for the stability of the market overall,” Sale said. “We will see some of this price pressure start to ease especially in the latter half of the year.”
Sale emphasized that the association is seeing the housing market has been bolstered by migration to East Tennessee. Sale added that most economists agree that cities like Knoxville may not see home prices fall, although they might not be growing as quickly as they would in the past two years.
For renters within the housing market, Sale says there’s still a lot of demand. The occupancy rate is still at 98% whereas a healthier renters’ market is considered to be around 94%.
“We’re still a long way from getting to where we need to be as far as the rental market,” Sale said. “We’re seeing rents grow fairly substantially.”
Sale said that perhaps more multiplex housing like duplexes or triplexes could be an answer for access to affordable rental spaces to increase the housing density in the area.
