Tri-Cities luxury home sales down 31% since May; eight-month trend up 45%
GRAY, Tenn. – Rising mortgage rates, stock market volatility, and inflation concerns have pushed Tri-Cities luxury existing housing sales down by 31% since May. But while $500,000 plus sales are down on a month-to-month basis, they are up 44.6% from the first eight months of last year.
So far, the buyer group hit hardest by current market conditions is first-time buyers who typically rely more on their income than wealth to buy a home.
Like the rest of the market, high-end home sales are taking a hiatus while things sort themselves out. There were three more pending sales in this price range than in August last year, and the active inventory is up 27.9% (27 properties).
And sellers are not hesitating to put their properties on the market. There were 108 new listings last month, up 21.3% from last year. So far this year, the new listings are 39.3% higher than last year.
During the past two years, local high-end and luxury home sales have outperformed many other price sectors. Attribute that to the fact that rock-bottom mortgage rates boosted buying power and some buyers leverage it for more home than they could have previously bought. The pool of qualified buyers is now shrinking because the stock market is falling, and mortgage rates are rising. The good news for buyers is prices are stabilizing, and some of the edge has come off the competition.
Another factor that boosted area luxury sales is out-of-area buyers were also active. After pursuing the high-end vacation and second home markets in the North Carolina mountain vacation region, some were attracted to local properties with a much higher value proposition. They’re still trolling the market, but are not as prone to jump in as they were late last year.
While the lack of inventory began curbing luxury sales in some markets, the local market was less restricted. During the 12 months ending in mid-September, $1 million plus sales increased to 71 properties from 51 during the same 12-month period in 2021.
During the same period, sales of homes in the $500,000 to $1 million range increased 47.5%, from 440 properties to 649.
A local MLS check shows that as of Sept. 20, there were 63 local listings with an asking price of $1 million and up. The top listing is in Jonesborough at $14.5 million.
NETAR is the voice for real estate in Northeast Tennessee. It is the largest trade association in the Northeast Tennessee, Southwest Virginia region, representing over 1,600+ members and 100+ business partners involved in all aspects of the residential and commercial real estate industries. Weekly market reports and information for both consumers and members are available on the NETAR website at https://netar.us