Attention local Real Estate Agents (Knoxville: short sales, real estate market, 2010)

[mmw]

It would be great if the local real estate agents who view this forum could provide a few stats on the current TN real estate resale market.

Have you seen an increase in sales? If so, what percentage?
Yes, it is a buyers market, but are the buyers buying?
Anything else you may find of interest.

The media has put such a damage on the real estate market that so many of us feel the world is caving in. However, not every market is the same. There are some areas in the US making a comeback in housing (slowly, but surely) Is eastern TN (focus on Blount County and Knoxville)?

Any input you can provide will be greatly appreciated!

[hiknapster]

Originally Posted by mmw

It would be great if the local real estate agents who view this forum could provide a few stats on the current TN real estate resale market.

Have you seen an increase in sales? If so, what percentage?
Yes, it is a buyers market, but are the buyers buying?
Anything else you may find of interest.

The media has put such a damage on the real estate market that so many of us feel the world is caving in. However, not every market is the same. There are some areas in the US making a comeback in housing (slowly, but surely) Is eastern TN (focus on Blount County and Knoxville)?

Any input you can provide will be greatly appreciated!

Not a real estate agent but must comment on the media remark. They didn't create the problem; greed did.

Loved to hear the stats from the agents, though, or maybe not.

[anothertntony]

Originally Posted by hiknapster

Not a real estate agent but must comment on the media remark. They didn't create the problem; greed did.

I would just like to add a "me too" to this post. If anything, the media was far too late in reporting the problems in the financial markets that lead to the problems in the housing market.

Blaming the media for the housing bust is like blaming them for global warming or hurricanes.

[leonard]

Originally Posted by hiknapster

Not a real estate agent but must comment on the media remark. They didn't create the problem; greed did.

The media gets some blame too.

After all, what is the difference between the following "Headlines"

The unemployment rate dramatically rises to 6.5%

or

The unemployment rate is just 1 1/2 % above full employment (5% is considered full employment) and over 93% are still working.
(Note I know it is now below that, but just a few weeks ago it wasn't)

The drop in home prices is the worst in 30 years.

or

The drop in home prices is similar to 30 years ago.


The unemployment rate is now as bad as during the last recession in the 90's

Or

The 90's saw a similar recession.


This recession is the worst since the Great Depression unemployment is nearing 10%

Or

We are nowhere nearly as bad off as during the Great recession, when unemployment was over 20% and there was no insurance on bank accounts, which we now have.


One makes it seem like the sky is falling and the other doesn't.

Which do you read in the media?

[William Sold]

Interesting question MMW. It took me a while, but I've done some statistical based research for you to give exact answers. Now, we all know the purpose of media, and what sells. In my advertising and marketing classes, the famous term about the media is that "if it bleeds, it reads." Meaning people want to hear the bad, they have an inclination to perk their ears up at bad news, but just go on drinking their coffee oblivious if the news is filled with found puppies, success stories, and sunny weather. Unfortuntely.

First, let me give my opinion of the Knoxville market and the media bias. I do a lot of internet research and real estate blogging. What a large amount of us have found, is that while the media is not to blame for a stale market (loose lending requirements and buyer's greed with escalating loans are), the media has definitely poured kerosene on the campfire. Most of the media reports are fact based on damaged markets in the country (Florida, California, Nevada). Then wildfire hits when the entire nation goes into lockdown mode after they are repeatedly told we're in a real estate depressed time. People are scared to purchase, they're skeptic of lender laws. This coupled with stronger loan requirement for buyers account for the lower amount of sales. BUT, all in all, Knoxville is a market that has been little affected in this market, on a value basis. Most homes have held their original value, contrary to belief. The nationwide average for depreciation in 08' as I last posted on here was 9% (Florida 26%, California 29% in some markets). Knoxville median value dropped 3.6%. But, Knox homes priced $100-300 have held value. The homes affected have been tied to the jumbo market, mostly homes of $450 and above. There are far fewer of these homes, and seeing their higher price, they affect the 3% depreciation much more than the lower priced homes, that have held value well. Our market is still bringing decent money on home sales, though the average length of listing has gone from 5 months to between 9 and 11 months. Although, my speculation is that home sellers and builders are being heavily impacted by distressed purchases (bankruptcies,short sales). Again, this brings us round to the original problem, loose lending and uninformed buyers taking on too much debt.

Too answer your question on the current market. I have two answers, yes and no. Yes, at mid-December through now many Knox realtors have seen a steady increase in buyer activity. I personally have never been busier in my entire career than the month of January, often gaining 2-3 immediate clients per week. However, October and November for many realtors was more or less a vacation. Tough times. Buyer's market surplus, reasonable prices, great APR rates, and new government I feel has been the key to many tire-kickers now becoming serious home searchers. 2008 is a year in real estate we all hope to forget, as the Knoxville market, per my research in Knox county sales, saw a 23% drop in overall home sale numbers for 2007 to 2008. I've listed month by month and yearly. Keep in mind, these are only numbers for Knox County.

Year 2008 4874 Closed - ,Year 2007 6400 Closed, -23%
January 2008 - 310 Closed, January 2007 - 404 Closed
February 2008 - 369 Closed, February 2007 - 481 Closed
March 2008 - 417 Closed, March 2007 - 595 Closed
April 2008 - 518, April 2007 - 598 Closed
May 2008 - 502 Closed, May 2007 -688 Closed
June 2008 - 514 Closed, June 2007 - 674 Closed
July 2008 - 555 Closed, July 2007 -690 Closed
August 2008 - 491, August 2007 - 607 Closed
September 2008 - 404 Closed, September 2007 - 511 Closed
October 2008 - 338 Closed, October 2007 - 495 Closed
November 2008 - 273 Closed, November 2007 - 455 Closed
December 2008 - 229 Closed, December 2007 - 375 Closed
January 2009 - 139 Closed, 229 Pending

If you notice the difference in January 09, we should be above where we were in January 08, and closer to 07 numbers. I suspect February to be a good month for Knoxville as compared to 08 from all conversations I've had with other agencies. Make no mistake, this is a buyer's market in EVERY sense of the word, though the beautiful and cyclical thing about real estate is that eventually, by definition, a buyers market always lead to a sellers market. It just may take a little longer this time. We can all hope so, as most people know the economy is stimulated strongly from housing market stability. Hope this helps to see the numbers.

P.S. Since I did this research, I went back and checked a few things. This worked out to the near exact number I posted, though this not how they figure their stats. I was just curious. The average closing house price in 2007 was $207,500 in Knox county. The average of 2008 was $200,064. The difference? 3.58%....

[mmw]

Thanks so much William Sold for the GREAT information you provided! There is so many people considering relocating to TN - and by the local real estate agents providing the information you have, it gives them insight to what is going on there.

We all know that if homes are moving, homes are appreciating or at least staying steady, then the community is doing pretty good. No one town is perfect, but it certainly helps in your decision making when you are aware of the real estate market. Again, thank you William Sold - great information.

And to comment on leonard's comment - I love how it was all spelled out. Just by looking at the positive, and not the negative, the news seems to be in a better light. I just believe that if the media could provide some positive news, everyone wouldn't be so fearful of our future. I know, I know, bad news sells! But just think what sort of publicity one may get if they shared good news now and then! :-)

[lochmoigh]

Quik question Qilliam,
How much inventory is availble? When I talked to realtors in October it was around 6 mos. is that still the case?

[Beretta]

Originally Posted by lochmoigh

Quik question Qilliam,
How much inventory is availble? When I talked to realtors in October it was around 6 mos. is that still the case?

In his post he mentions that it went from 5 months to 9-11 months.

I wish we had a Blount County realtor counterpart to William on here.

[hiknapster]

The recession is what it is. Unemployment in December in Tennessee was 7.9 percent. The U.S. rate is 7.2 percent. The jump in unemployment in Tennessee is considered "significant" according to the BLS. That is not the media.

No one loves the messenger who brings bad news.

I guess that is good news, Will, and I am really glad that you are busy. I just can't help thinking we would be swamped if Florida and Californians weren't stuck. And the prices in Florida are so low in many areas that some folks may bypass this area all together.

I wouldn't want to live in Florida, though. Bleah.

[William Sold]

Oh Smoky, all you had to do was ask! I'm not just a Knox County realtor...You'll notice the identical decrease in overall sales, at 23%, which shows the similar to exact adjustment of buyers in the Metro market across the board. However, the median value was less at 2.3% decrease. As per my earlier post, with the $100-300 homes, they have held their value fairly well, and this is a lot of the Blount county market.

Readjusted Blount County totals for SMG...
Year 2008 1200 Closed - ,Year 2007 1574 Closed, -23.7%
January 2008 - 87 Closed, January 2007 - 102 Closed
February 2008 - 88 Closed, February 2007 - 134 Closed
March 2008 - 125 Closed, March 2007 - 168 Closed
April 2008 - 121 Closed, April 2007 - 143 Closed
May 2008 - 128 Closed, May 2007 -162 Closed
June 2008 - 137 Closed, June 2007 - 167 Closed
July 2008 - 116 Closed, July 2007 -139 Closed
August 2008 - 120 Closed, August 2007 - 173 Closed
September 2008 - 107 Closed, September 2007 - 126 Closed
October 2008 - 76 Closed, October 2007 - 124 Closed
November 2008 - 73 Closed, November 2007 - 89 Closed
December 2008 - 72 Closed, December 2007 - 83 Closed
January 2009 - 23 Closed, 64 Pending

2007 Average Close Price - $193,783
2008 Average Close Price - $189,208/ -2.3%

P.S. Again, January 09 numbers look identical if not better than 08, as there's still a few days left in the month, and realtors are notorious for not pending an active house for a few days, but, most of these late pends will be represented in February numbers.