2020 was a mystifying year for economists and real estate experts. Neither party expected the housing market to perform so well during the crisis. Fortunately, homebuyers took advantage of historically low interest rates and started buying houses in droves.
Sellers also enjoyed growing prices, selling their homes for more than the original listing price. Where does Tennessee fit into the equation? The state’s trends are on par with national trends. Tennessee is expected to continue the success of 2020 through 2021, but there’s more on the horizon. Discover the latest Tennessee real estate market trends for 2021 and beyond.
Increase in Tennessee Real Estate Values
Home values in Tennessee already jumped in 2020. Now, they’ve increased a staggering 8.7% statewide, according to Zillow, bringing the average home value up to $230,000.
Cities are doing even better individually, with Knoxville showing an impressive 21% increase in home values. Nashville is also doing great with its $32,000 value increase per home.
Wait, but I’m a homeowner. Can I easily sell my house in this economic climate?
Tennessee is experiencing a rare time where the market is strong for both buyers and sellers. Homebuyers are still enjoying low interest rates, stimulus checks, and other incentives. Plus, buyers can sell their houses quickly.
Expect home values to trend upward as more homebuyers move out of cities and into more suburban areas. However, look for changes as interest rates start rising and lending tightens up.
The Impact of Student Debt Forbearance
Student debt has been a roadblock to many people’s dreams of homeownership. When the federal government announced a student loan forbearance in 2020, borrowers were suddenly free to invest in assets.
In fact, more than half of surveyed millennials planned to buy a home with their forbearance savings, according to 2020 data.
However, student loan payments are also expected to resume in the fall of 2021. Since many homebuyers used the forbearance relief to buy homes, expect a slow down as payments resume.
If the current administration extends the student loan forbearance, expect more millennials to buy homes in Tennessee in 2022.
Rising Rent Prices
Rent prices are rising along with housing prices in Tennessee.
Industry data reveals that Tennessee rent prices rose nearly 6% statewide. However, the state’s rent average is still markedly lower than the nation’s average. Thus, the state still offers competitive rental pricing for students and professionals.
On the flip side, states like California are driving out families and professionals with soaring rent prices. This trend directly impacts the Tennessee real estate market since the west’s exodus is bringing more people to the south.
These rental price trends are great news for landlords. Now is an excellent time to buy rental property while interest rates are still low.
Buy Your Dream Home in Tennessee
Are you ready to take action?
Take advantage of the Tennessee real estate market while it’s still hot. Sell your current home and buy the house you’ve always wanted.
Work with a realtor to learn more about the buying and selling process. You can also use digital tools to sell your own home in Tennessee.
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