Kingsport 2008 home sale prices up 5.6%, total sales down

Published Friday, January 30 2009 - (0) Comments

The 2008 housing market in NE Tennessee was a year to forget in most categories, but there are bright spots. And, there's reason to anticipate that the area housing market is poised for recovery. It's just waiting for a spark to ignite it.

First the numbers.

NE Tenn. - 3924 homes sold in the NE Tenn region during 2008 - 993 fewer than 2007. (-20.2% )
- The average sales price dropped $7,107 to $145,653. That a 4.64% decrease.

Kingsport - 1161 homes sold in 2008 - 338 fewer than 2007 (-22.5% )
- The average sales price was: $144,657 (+5.6%)

Johnson City - 1738 homes sold - down 418 from 2007 (-19.3% )
- The average sales price was $169,097 (-3.1%)

Bristol - 522 homes sold - 84 fewer than 2007 ( -13.8% )
- The average sales price was $144,181 (-6.4%)

Greeneville - 503 homes sold - 155 fewer than in 2007 (-23.6% )
- The average price was $124,676 (-14.2%)

So how does the area stack up against the national numbers?

According to the National Association of Realtors sales nationally fell by 13.1 percent in 2008. Prices also fell with the median price of a single-family home setting at $198,600 - down 9.3 percent from the 2007 median price of $219,000.

In December existing homes sales posted an unexpected increase of 6.5%. That surge was focused in the western U.S. and Florida where bank-owned homes were sold at bargain-basement prices to clear the books.

But that wasn't the case in NE Tennessee. The only increase in December home sales was posted in Greeneville.

Local Realtors say the local and regional housing market is under performing because mortgage rates are at or near 50-year lows, local lenders are expediting mortgage loans to customers who qualify and there's there ample housing inventory in most price ranges. The problem is buyers who are stuck in the don't spend mode.

Carla Dunn thinks one of the reasons area numbers are off is we didn't have as many people from Florida and other areas moving to our region as we have in the past. "They're sitting on the fence, but it will bounce back." Dunn is this year's president of the NE Tennessee Association of Realtors and the principal broker of Town & County in Gray.

National Association of Realtors chief economists Lawrence Yum is making a similar explanation for national home sales. "We've added 25 million people to our population over the past decade and housing affordability conditions are the best we've seen since 1973, but household formation is much lower than expected." That means there's a pent-up demand that could be released with the right stimulus.

That stimulus is a primary focus for local and national Realtors.

One thing they pushing is making the $7,500 new home buyer incentive non-repayable and extending it to existing home sales.

Yum said, "The Obama administration and Congress need to move fast to stimulate a spring sales upturn which will help to stabilize home prices and set the foundation for a sustainable economic recovery."

The housing inventory is the key. Before the national housing market turns the corner the surplus of homes on the market created by the mortgage debacle has to be absorbed into the economy. After that happens prices should increase and the pent up demand for new home building will be released.

Dunn said the housing inventory in NE Tenn has bucked the national trend by holding "fairly steady," which means there isn't the surplus that has to be sold before housing sales regain their roles as a leading increment in economic recovery.

Until then Dunn's mission is to get the message out that the local housing inventory is good and mortgage rates are low - the market here is better than it looks, especially for buyers.

CLICK HERE for a 2004-2008 comparison of average home sale prices, average days on the market and total sales volume.

Sources Data for this story is the TNVA MLS and the TCI Group.
The data for each town is the MLS boundary which are:

Kingsport - Northwest Kingsport, Lynn Garden, Bloomingdale, Crown Colony, Windridge, West Kingsport, Sullivan Gardens, Horse Creek Village, Rock Springs, Colonial Heights to Fordtown, Greeneacres, Preston Weeds, East Kingsport, Indian Springs, India, Airport, Fall Creek, Cooks Valley, Highland, Fairacres, Preston Forest, Downtown, Greenfields, Hillcrest, Weber City, Va., Hawkins County and Kingsport Area 16

Johnson City - NW Johnson City, NE Johnson City, SE Johnson City, SW Johnson City, Watauga, Gray/Boones Creek, Sulphur Springs, Fall Branch, Harmony, Jonesborough, The Ridges, Limestone, Telford, Unicoi County, Erwin, S Unicoi County, Carter County, Roan Mountain, Mountain City Johnson County.

Greeneville - Greeneville City, Greene County, Cocke County, Hamblen County,

Bristol TN - Bristol TN (City), Bristol TN (County) Piney Flats, Bluff City, Blountville.

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