Hot Markets

Kingsport keeps top spot for market share performance 

May's city market share is pretty much a replay of what we saw in March and April. Kingsport kept its place at the top of the leaderboard and expanded its position by 0.3%. It's the only city market that has consistently outperformed its annual 2017 market share benchmark.

Greeneville posted its third straight month of single-family resales at a higher share than the benchmark although May was almost a point off April's pace.

The three city markets that make up the core of the Johnson City Metropolitan Statistical Area (MSA) are all performing a more than 1 point below their benchmarks. Johnson City has the weakest resales share performance, down 1.8% followed by Elizabethton, down 1.6%, then Erwin, down 1.1%.

After a strong start, Bristol TN hasn't been able to sustain consistent above benchmark performance, but in was only 0.1 point off the pace last month. Bristol VA also had a strong start in January but has slipped each month since

Sullivan hangs onto county market share lead, Johnson, Hawkins show steady gains

Since the county resale market share includes city sales, the overall performance typically parallels what we see in the city markets. Despite some softness in Bristol TN's performance Kingsport had enough momentum to keep Sullivan county at the top of the leaderboard.

It's also noteworthy that Johnson County continues to show strong performance. Last month its share was 1.4% better the benchmark, and that performance hasn't varied more than 0.2% any month since the beginning of the year. Johnson County doesn't have a city market included in the Northeast Tennessee Trends Report (NETAR), but the data includes Mountain City resales.

Hawkins, which also doesn't have a major city market in the NETAR Trends calculation, has also posted thee straight months above the 2017 benchmark share. Much of the housing market advances in Hawkins can be attributed to its wage performance last year. It led the region in year-over-year gains. Carter was slightly behind Hawkins in annual wage growth, but it hasn't resulted in the same housing market boost that Hawkins is seeing.







City markets - year-over-year and year-to-date performance

Year-over-year comparison on closings shows every city market except Erwin and Greeneville outperforming last year's resale totals. That parallels the year-to-date closing trend.

Although there's not much difference in totals, May's closing trend put Kingsport at the top spot by six closings.

May's average sales price year-over-year metric shows softness in Greeneville, Elizabethton, and Bristol VA while Erwin's average dipped quite a bit. The year-to-date trend shows a continuation of softer prices in both Johnson City and Erwin compared to price performance during the first five months of last year.

County markets - year-over-year and year-to-date performance

Hawkins was the only county market that fell short of its May 2017 performance, and that dip was small. The year-to-date metric shows all of the counties in the region positive for the first five months of this year.

May's average sales price also saw only one county market in the red while the year-to-date metric paralleled closings with each county market posting a better performance level than last year. Carter County, which had the only negative number in the May-to-May comparison, had the smallest trend gains and was the only county with less than a point increase so far this year.

Home sale trend  - inventory and observations

May's strong closings total moved the moving-average trend to its highest level since July last year and 10.2% better than May last year. It was the second month of double-digit year-over-year bumps in the trend line. Although the trend had consistently outperformed last year, it has twice dipped to almost the same level of the same month for the previous year.

May's inventory improved slightly since there were 128 more new listing than new approved contracts. During previous months new contracts absorbed almost all new listings. During May the region had 4.2 months of inventory. It was 5.8 months May last year.

A drill down of listing by price shows 287 fewer listings in the prime $200,000 and below price range. That tier historically accounts for about 75% of all area existing home sales.

The only market with more listings in the $200,000 to $399,999 range was Bristol. The Johnson City metro area had the same number of listing in that tier as last year while the Greeneville and Kingsport markets had fewer listings. Kingsport had the biggest deficit – down 48 from May last year.

Johnson City and the Twin Cities markets' $400,000 t0 $599,999 inventory were up from last year but down in Greeneville and Kingsport, which also saw the biggest decline – 17 listings.

All of the markets except Johnson City had more $600,000 to $799,999 listings than May last year.

Both Johnson City and Kingsport had an increase of five more listings in the $800,000 and above price range.

May's closing got very close to the 700 limits. Since June is typically the biggest closing month of the year, it could break that barrier next month. May was also the single best month for closings in the past decade. Despite the racking up new records, the region's sales growth rate are slowing. More signs of that should become clearer as soon as we see how its peak buying and selling season plays out.

May's annualized sales point to an annual total that's just short of the 2017 actual total. That should improve with June's Trends report since June is typically the strongest closing month of the year.

Employment, job creation and sales tax collections are also seeing a slowing growth rate while the region's labor shortage is exerting more pressure on wages. The head winds for consumer spending continues to be gasoline prices and the uncertainty over the effect of foreign trade battles between the Trump administration and trading partners.  Gas prices are trending lower after flirting with the bottom of the $3 a gallon range. Three dollars a gallon is the tipping point when gas prices will result in less consumer activity in other areas.