As we enter the heart of the Tri-Cities’ prime home buying and selling season, the market is approaching an inflection point.  

For nearly three years, high borrowing costs squeezed the Tri-Cities housing market. Owners with record-low mortgage rates have been reluctant to give them up, and that combined with the lack of affordable choices for many buyers compressed inventory levels needed to stimulate a healthier and more balanced market.  

With rates beginning with a “5,” we are seeing a credible signal for improvement. The rate is a strong psychological nudge that parallels the region’s position for an increase in market activity.    

Research from the National Association of Realtors® (NAR) estimates that 10,404 locals are in the pent-up demand category. They’re on the sidelines for varied reasons. Some are waiting for better mortgage rates. Others want to see lower prices. Those are strong inhibitors waiting for a trigger to release the pent-up demand created by the housing market’s five Ds.  

The Ds – diapers, diplomas, diamonds, divorce, and death – are the phases in a homebuyer’s life that determine when then need a larger or smaller home.   

Rates below 6% won’t bring all those locals back to the market at one time. But history shows that rate changes move the market. And lower mortgage rates combined with the improvement in affordably noted in last week’s column have the potential for more momentum in a market that’s ripe for it. 

Here’s a snapshot of what the largest consumer groups by age look like as we enter the spring buying and selling season. 

Residents in the 35-44 age group in the Johnson City metro area have the most potential to re-enter the market. According to NAR research, that’s the largest share (65%) of households and renters who can afford to buy a median-priced home. 

In the Kingsport-Bristol metro area, two age groups share the spotlight. According to NAR, 55% of those in the 35-44 age group and 54% of those 45-74 can afford a median price home in that metro area at the targeted mortgage rate.   

Lower mortgages and increased affordability options give the Tri-Cities three defining characteristics as it enters the year’s prime season: 

–  Structural Stability. Equity levels remain strong. Inventory is constrained but not collapsing. Price floors have held. 

–  Rate Sensitivity. Affordability margins are tight enough that even small rate movements meaningfully change qualification outcomes. 

–  Demographic Depth. Core buying-age cohorts are large and financially positioned to act if conditions improve. 

A mortgage rate beginning with a “5” may not unlock all the sidelined local buyers identified by NAR’s research. But it will chip away at the psychological barrier that has defined this phase of the housing market’s cycle. 

Prime season in the Tri-Cities this year will increasingly be about momentum. And as always, the Northeast Tennessee Association of Realtors® (NETAR) and its members will watch not only the rates, but how households respond because this market behavior tells the real story.