2023 Southern Living Idea Home

Visiting the 2023 Southern Living Idea House

I had the opportunity to tour the 2023 Southern Living Idea House recently at the invitation of Nicole Hendrick Santee, Brand Homes Director for Southern Living. Over the last few decades, Southern Living has teamed with designers, builders, architects, product manufactures and trades to construct a home showcasing some of the latest products, processes and trends in the residential home industry.

Real Estate image representing a Tennessee home transaction

Why Real Estate in Tennessee?

There are numerous reasons Tennessee is getting the attention of investors

  1. Tennessee is one of only a few states with state no income tax (Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming).
  2. A lot of available acreage. Tennessee is not geographically or geologically constricted. There are very few constrictions for growth in Tennessee.
  3. It's attractive state. Green rolling hills, mountains, lakes, rivers, hardwood trees, 4 seasons, moderate climate.
  4. Ecconomically diverse. The uniquiness of the three grand divisions have driven Tennessee's growth across numerous ecconomic verticals
  5. Physically diverse. Flat on one side (rich soils), Mountainous on the other (natural resources), and everything else in-between (accessibility).
  6. Proximal to numerous business and industry verticals. Including shipping, manufacturing, aggricultural, insurance, healthcare, LiOn battery Mfg, 2 car manufacturers, entertainment and hospitality, and recreation
  7. Tennessee is very conducive for business and investing.
Chart showing Real Estate Transaction data in Tennessee

Top 5 Factors Affecting the Tennessee Real Estate Market

The Tennessee Real Estate Market is still Very Active:

Tennessee's real estate market is still very active. Tennessee is in the top 5 states (Florida, Texas, North Carolna, South Carolina and Tennessee) with respect to activity. There is a lot of discussion and concern regarding market conditions and what impacts they are having on the housing market. Interest rates certain have cooled the fever pitch of the last 2 years. Conversely they have also reduced the available inventory, keeping prices and competition for available properties strong.

Here are the top 5 factors impacting the real estate market in Tennessee in the news today:
  1. Mortgage rates continue to rise in Tennessee. The average interest rate for a 30-year fixed-rate mortgage in Tennessee is now 7.57%, up from 7.23% a month ago. This is the highest level since 2011. Rising mortgage rates are making it more expensive to buy a home in Tennessee, which is expected to cool the housing market.
  2. Home prices continue to rise in Tennessee, but at a slower pace. The median home price in Tennessee is now $384,100, up 4.2% from a year ago. The median price is the middle price of all homes sold in a given month. This means that half of the homes sold for more than $384,100 and half sold for less. However, the pace of home price appreciation is slowing, as more homes come onto the market and mortgage rates rise.
  3. Inventory of homes for sale is increasing in Tennessee. The number of homes for sale in Tennessee is up 19% from a year ago. This is the first year-over-year increase in inventory since 2019. The increase in inventory is being driven by a number of factors, including rising mortgage rates and a decrease in demand from investors.
  4. Demand for housing remains strong in Tennessee. Despite the rising mortgage rates and slowing pace of home price appreciation, demand for housing remains strong in Tennessee. This is due to a number of factors, including strong job growth and a limited supply of homes.
  5. Rent prices are rising in Tennessee. Rent prices are rising at a faster pace than home prices in Tennessee. The Tennessee rent index is up 17.2% year-over-year. This is the fastest pace of rent growth since 2005. The rising rent prices are putting a strain on renters, especially those who are low-income.