June 23, 2025

Tennessee Housing Market Shows Stability Amid Fluctuations

News Summary

In the first quarter of 2025, Tennessee’s housing market exhibited stability despite regional fluctuations in home prices and sales. Strong employment figures and increased permitting activity contributed to this balance. Multi-family construction has surged, while home prices showed a slight increase. Regions like Kingsport-Bristol led in home value growth, with overall predictions suggesting continued market growth despite rising mortgage rates and affordability challenges for first-time homebuyers.

Tennessee Housing Market Maintains Stability in Q1 2025 Amid Regional Fluctuations

Tennessee’s housing market has demonstrated stability in the first quarter of 2025, despite experiencing regional fluctuations in home prices and sales volumes. This stability stems from strong employment figures coupled with increased permitting activity across the state, according to an analysis conducted by Middle Tennessee State University’s Business and Economic Research Center.

The director of the center noted that the market is currently in a “balanced” state, indicating that while some areas face challenges, the overall trends suggest a measured equilibrium in housing conditions. Multi-family construction permits have surged, registering a 66% increase from the previous quarter and a remarkable 62.25% rise year-over-year, signaling heightened activity in denser housing segments.

Across Tennessee, home prices have seen a slight quarterly increase of 0.11%, reflecting an annual growth of 3.7%. However, this growth rate is lower than the national average increase of 4.6% during the same period. In Nashville, home closings dropped 3.75% from the previous quarter, yet demonstrated a year-over-year increase of 3.44%. Conversely, Memphis recorded a 6% increase in closings compared to the previous quarter, although this figure represents an 8% decline when compared to the same period last year. Meanwhile, Knoxville reported a minimal quarterly dip of 0.23% but enjoyed a 3% increase in home values year-over-year.

Inventory levels of homes for sale have also moved upward, climbing by 14.2% compared to the previous quarter and showing a significant 39% increase from the same time last year. Among various markets in Tennessee, Kingsport–Bristol has emerged as a leader with a 10.3% increase in home prices year-over-year, while Knoxville and Chattanooga recorded increases of 4.13% and 3.8%, respectively.

The report highlighting these trends was funded by the Tennessee Housing Development Agency (THDA), which aims to support affordable housing initiatives through various programs and partnerships. Looking ahead, predictions for the housing market indicate an expected growth of around 3.7% for home prices throughout 2025, with mortgage rates projected to average 6.3%, slightly lower than the rates seen in 2024.

Additionally, the homeownership rate in Tennessee is anticipated to decrease by 0.3%, sliding from 65.6% to 65.3% between 2024 and 2025. Existing home sales are predicted to rise by 1.5%, potentially reaching a total of 4.07 million sales. The inventory of existing homes for sale is expected to be 11.7% higher in 2025 than the previous year, indicating an increase in available housing options.

Despite these promising signs, the housing market remains competitive and costly due to the prevailing high mortgage rates. The median asking rent for 2025 is projected to be 0.1% lower than in 2024, which may not alleviate the ongoing challenges of affordability for renters, even with a predicted increase in rental stocks of 1.5%.

First-time homebuyers may encounter significant hurdles in 2025, facing high costs and limited affordability options. In the midst of these trends, Nashville has been ranked among the top 10 buyers’ housing markets, illustrating continued interest and demand in the region.

A comprehensive report on the ongoing housing trends in Tennessee is accessible for those interested in detailed statistics and analysis. The information can contribute to a better understanding of the housing dynamics both regionally and statewide.

Deeper Dive: News & Info About This Topic

HERE Resources

Tennessee Sees Historic Population Growth Amid Influx of New Residents
Tennessee Expands Job Opportunities with New Summertown Metals Facility
Community Events Scheduled for June
Murfreesboro Faces Housing Affordability Crisis
Tri-Cities Housing Market Continues to Favor Sellers
Tennessee Homeowners Face Rising Mortgage Costs
Nashville’s Transformation into a Thriving Metropolis
Upcoming Events in East Tennessee and Southwest Virginia
Renshaw Company Merges to Enhance Real Estate Services
Urban Story Ventures Acquires Northgate Crossing Shopping Center

Additional Resources

Author: STAFF HERE BRISTOL WRITTER

The BRISTOL STAFF WRITER represents the experienced team at HEREBristol.com, your go-to source for actionable local news and information in Bristol, Sullivan County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Bristol Rhythm & Roots Reunion, NASCAR races at Bristol Motor Speedway, Border Bash concert series, and the Hot Bristol Night Car Show. Our coverage extends to key organizations like the Bristol Chamber of Commerce, Believe in Bristol, and the Birthplace of Country Music, plus leading businesses in healthcare, manufacturing, and entertainment that power the local economy such as Ballad Health, Strongwell, and Bristol Motor Speedway. As part of the broader HERE network, including HEREChattanooga.com, HEREKnoxville.com, HEREMemphis.com, and HERENashville.com, we provide comprehensive, credible insights into Tennessee's dynamic landscape.

ADD MORE INFORMATION OR CONTRIBUTE TO OUR ARTICLE CLICK HERE!

STAFF HERE BRISTOL WRITTER

Stay Connected

More Updates

Students studying on a university campus in Tennessee

Would You Like To Add Your Business?

Submit