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Knoxville & East TN Real Estate Market Update: Year-End 2025 Review & 2026 Outlook

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Happy New Year! As we close the book on 2025, the Knoxville and East Tennessee real estate markets are telling a fascinating story of normalization, returning balance, and new opportunities.

If 2025 was the year the market took a breath, 2026 is shaping up to be the year it finds its footing—especially with major news regarding mortgage rates hitting the headlines just yesterday.

Here is your comprehensive breakdown of the December 2025 numbers, a full-year review, and my top predictions for what lies ahead in 2026.

The Big Picture: Knoxville vs. East Tennessee

Overall, 2025 moved us toward a more balanced feel. Inventory is up, homes are taking longer to sell, and buyers finally have room to negotiate. However, the city and the region are behaving differently.

Knoxville: Strong Finish, Softening Prices

Knoxville had a dramatic finish to the year.

  • Sales: Up 12.5% year-over-year in December.
  • Inventory: Skyrocketed by 31.6%.
  • The Surprise: Despite the activity, pricing softened. The median sold price dipped 5% in December to $380,000.

Knoxville remains a tighter market than the region (2.9 months of supply), but the pricing dip suggests sellers are adjusting to the new reality.

East Tennessee: Building Momentum

The broader region is showing signs of a very strong start to 2026.

  • Pending Sales: While Knoxville pendings were up 6.1%, East Tennessee’s pending sales jumped 19%.
  • Balance: The region sits at 4.4 months of supply, making it a more balanced environment where buyers have genuine leverage.

Surrounding County Breakdown (Data Cards Below)

Real estate is hyper-local. To understand where the market is going, we have to look at the specific counties we serve. Here is how the numbers shook out for December and the full year of 2025.

Roane County

Roane is seeing a surge in activity, likely driven by spillover demand from Knoxville and lake-access lifestyle buyers.

  • The Data: Inventory is up 23.6% and pending sales jumped 14% in December.
  • Pricing: You might see a headline that prices jumped 25% in December, but don’t let that fool you. That is likely a “mix shift” (more expensive homes selling that month). The full-year appreciation is a steady, modest 3.17%.
  • The Takeaway: Roane is catching demand. Expect moderate appreciation and solid traffic in 2026.

Knox County

Knox County, the metro anchor, is showing clear signs of normalization.

  • The Data: Inventory is up significantly—nearly 29% year-over-year in December, with pending sales also up almost 10%.
  • Pricing: Despite the increased options and returning buyers, price growth is mild: median sales price rose just under 2% in December, and the full-year gain was just above 2%.
  • The Takeaway: This suggests a market that’s regained balance after the ultra-competitive years, with more choices for buyers and steady, sustainable price trends. Knox is still the area’s bellwether—more inventory, more buyers coming back, but prices are stabilizing rather than surging.

Anderson County

Anderson is the “Supply Leader” right now.

  • The Data: Inventory jumped 37.4% in December—the largest increase in this group.
  • Pricing: Prices held up (up 3.92% in Dec), but full-year growth was only 1.22%.
  • The Takeaway: Supply is rising faster than demand here. If rates drop, Anderson has the inventory to absorb buyers without instantly turning into chaos. It is currently a very buyer-friendly market.

Loudon County

Loudon remains the higher-priced, hybrid market catering to move-up buyers and retirees.

  • The Data: Pendings were up 15.7% in December, showing strong demand.
  • Pricing: The median price sits at $497,000.
  • The Takeaway: Loudon is payment-sensitive. Turnkey homes sell well, but dated or oddly located homes are sitting. Expect a “split market” in 2026 where condition dictates success.

Sevier County

Sevier is our most unique animal due to the investment and second-home dynamic.

  • The Data: Pendings were up a massive 22.74% in December.
  • Pricing: Full-year price growth was modest at 2.22%.
  • The Takeaway: This market is highly sensitive to interest rates. If rates stay low, Sevier could re-accelerate quickly, but pricing will depend heavily on investor appetite.

Blount County

Blount is the “Sleeping Giant” that just woke up.

  • The Data: Pending sales surged 38.8% in December—the biggest jump in the region.
  • Pricing: Prices remained flat (up roughly 1%).
  • The Takeaway: This is a classic sign of a heating market. Demand is surging, but buyers still have enough negotiating room to keep prices from spiking. If this momentum carries into Spring, expect a faster sales pace.

Community Spotlights: Farragut, Lenoir City, & Tellico Village

(Data Cards Below)

  • Farragut: Still supply-constrained. Sales were up nearly 47% in December. If rates drop, Farragut will feel it through competition.
  • Lenoir City: Acting like a healthy, balanced market. If rates drop, Lenoir City will feel it through affordability, as more buyers will qualify for loans.
  • Tellico Village: A lifestyle market. 2025 was much more balanced than 2024. If rates drop, Tellico will feel it through momentum and a strong Spring start.

The Game Changer: Mortgage Rates Drop to 5.99%

Just yesterday, we received major news: President Trump announced a push for Fannie Mae and Freddie Mac to purchase $200 billion in mortgage-backed securities.

The market reacted instantly. The 30-year fixed rate dropped to 5.99% today.

This is the first time we have seen a rate start with a “5” since 2023. This is a massive psychological barrier. Whether you are buying, selling, or refinancing, this changes the math and the mindset heading into 2026.

5 Predictions for the 2026 Housing Market

Based on the 2025 data and this new rate environment, here is what I expect:

  1. Buyers Will Re-Enter the Market: It’s not just about affordability; it’s about confidence. At 5.99%, buyers who have been on the sidelines will return.
  2. Pendings & Closings Will Improve: East TN already has pending momentum. Lower rates will convert those contracts into closings.
  3. Inventory Won’t Vanish: We have more inventory than a year ago. Even with higher demand, I don’t expect the shelves to clear overnight.
  4. Prices Will Stabilize: The price softening we saw in December (especially in Knoxville) should level out. We aren’t going back to double-digit appreciation, but we should see steady, modest growth.
  5. The “Split Market” Continues: Even with lower rates, buyers are picky. Updated, move-in-ready homes will fly. Overpriced or dated homes will still need price cuts.

The Bottom Line

2025 was a year of normalization. 2026 looks like a year of opportunity.

If rates hold at these levels, the pace of the market is going to change quickly. Strategy matters now more than ever. If you are thinking about buying or selling this year, let’s start planning now so you can take advantage of this shift.

Have questions about your specific home or neighborhood? Reach out to Cornerstone Realty Associates today.

Are Knoxville Home Prices Cooling? October 2025 Knoxville & East Tennessee Housing Market Update

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Are you wondering what’s really happening in the Knoxville and East Tennessee real estate market? The latest data for October 2025 reveals a turning point for both buyers and sellers, with significant changes in inventory, pricing, and market dynamics. Whether you’re thinking of buying, selling, or just keeping an eye on the local market, this comprehensive update breaks down the key trends you need to know.

Knoxville Housing Market: A Shift Toward Balance

The Knoxville single-family home market is experiencing a notable transition. Inventory levels have surged by an impressive 42.3% year-over-year, giving buyers far more choices than in October 2024. New listings are up 11.5%, and pending sales have climbed by 12.3%, indicating that demand remains active despite the influx of supply.

However, closed home sales dropped 5.9% compared to last year. This shift means that, while buyers are interested, the increased inventory isn’t being fully absorbed, signaling a clear move away from the intense seller’s market conditions of recent years.

Pricing Trends in Knoxville

  • Median sales price fell 5.9% year-over-year to $382,500, a significant decline.
  • Average sale price remained virtually flat at $497,005, up just 0.4%.
  • Median active list price dropped 2.3%, while the average list price increased 2.2%. This suggests that while some sellers are adjusting prices downward, higher-priced homes are staying on the market longer.
  • Average days on market jumped 48.5% to 49 days, and median days on market rose 43% to 20 days. Homes are taking longer to sell as buyers become more deliberate and selective.

Month-Over-Month Snapshot

Compared to September, the absorption rate in Knoxville ticked up slightly to 3.11 months (from 3.05). Both average and median days on market increased, reinforcing the trend of a cooling market. Despite these headwinds, pending sales rose from last month, showing there’s still underlying demand even as buyers take more time and exercise greater negotiating power.

Key Takeaway for Knoxville

The Knoxville real estate market is now much more balanced. Buyers have regained leverage, sellers face more competition, and price appreciation has clearly stalled. Sellers should prepare for longer marketing times and the need to price competitively to attract offers. Buyers, on the other hand, can expect a greater selection of homes and improved negotiating conditions compared to the overheated market of a year ago.

East Tennessee Housing Market: Signs of Normalization

Looking beyond Knoxville, the East Tennessee single-family housing market is also showing clear signs of normalization in October 2025.

  • Inventory levels rose sharply, up more than 22% from last year, giving buyers more options and easing some of the competitive pressure.
  • Home sales were up just over 3% year-over-year, while pending sales surged 20.8%, signaling strong momentum heading into the winter months.
  • New listings climbed 12%, and while sellers continue to price homes optimistically (list prices up 2–3%), actual sales prices showed stability.
    • Median sales price dipped just 0.54% to $368,000
    • Average sale prices remained flat
  • Absorption rate now sits at 4.78 months, up from 4.06 a year ago, reflecting a market moving toward balance.
  • Average days on market rose to 64, a 36% increase from last year, though marketing times improved slightly compared to September.

County-Level Highlights

  • Roane County: Inventory up 41.7%, pending sales up 32.2%, median price up 3.7% to $350,000.
  • Knox County: Inventory up 37.1%, pending sales up 12.7%, median price down 4.74% to $381,000.
  • Anderson County: Inventory up 34.6%, pending sales up 21%, median price down 1.34% to $332,000.
  • Loudon County: Inventory up 17.1%, pending sales up 11%, median price down 12.52% to $544,500.
  • Sevier County: Inventory up 10.94%, pending sales down 11.41%, median price up 25% to $575,000.
  • Blount County: Inventory up 10.5%, pending sales up 13%, median price down 2.46% to $390,075.

Four out of six counties saw median prices lower than a year ago, showing that while some areas still see appreciation, price growth is largely stalled or even negative across much of the region.

Market Charts: Knoxville Metro at a Glance

  • Active listings are at their highest in six years, surpassing even pre-pandemic levels.
  • Weeks of supply have jumped to 17, up from 11 in 2019, showing a significant increase in inventory relative to demand.
  • 2025 saw the lowest number of homes sold for this point in the year in the past seven years, reflecting slowing demand.
  • New listings are the second highest in seven years, further adding to supply.
  • Days on market are at their highest in six years, and pending sales are at their second lowest.
  • Sale-to-list price ratio is at 98.1%, tied with 2019 and 2024, indicating more negotiation and less bidding above asking price.
  • Price drops are at their highest in the past six years, reflecting increased pressure on sellers to adjust pricing.

Why Is This Happening?

The market is still digesting the effects of the pandemic boom. Many buyers who would have purchased homes in 2025 instead bought earlier, thanks to historically low interest rates and a flexible work-from-home environment. This “pull forward” in demand has resulted in slower sales today, combined with a return to more normal inventory levels.

What’s Next for Knoxville Real Estate?

Despite the current moderation, Knoxville remains a market to watch. According to Zillow, the city ranks number four among the top 15 U.S. metros expected to see the largest home price increases between September 2025 and September 2026, with a forecasted 5% gain. Move Buddha’s Moving Forecast also names Knoxville as the most popular city to move to in 2026, with a high in-to-out migration ratio.

Final Thoughts

The October 2025 Knoxville and East Tennessee housing market update clearly shows a shift toward balance. Inventory is up, prices are moderating, and homes are taking longer to sell. Buyers now have more leverage and negotiating power, while sellers must adjust expectations and price competitively to succeed in this new environment.

If you’re thinking about buying or selling a home in Knoxville or East Tennessee, now is the time to work with a knowledgeable real estate professional who can help you navigate these changing market conditions.

For more updates or to get advice tailored to your situation, don’t hesitate to reach out!

Ready to make your next move in Knoxville or East Tennessee? Contact us today for personalized guidance and market insights.

East Tennessee Real Estate: A Dynamic Housing Market in 2023 and Beyond – NOVEMBER 2023 UPDATE

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Knoxville Real Estate Trends: A Thriving Market in East Tennessee

East Tennessee’s real estate market, particularly in Knoxville, has demonstrated remarkable resilience and growth in recent times. In Q3 2023, Knoxville’s home price growth ranked an impressive No. 4 among the top 100 metro areas. This surge reflects a significant 11.6% increase from the previous year, as reported by the Federal Housing Finance Agency (FHFA). Such robust growth showcases Knoxville’s burgeoning appeal in the East Tennessee real estate landscape.

Anticipating 2024: Knoxville’s Housing Market Projections

A recent survey from Fannie Mae shows that 23% of consumers think prices will fall over the next 12 months. That’s nearly one in four people who are dealing with that fear – maybe you’re one of them. To help ease that concern, here’s what the experts say will happen with home prices not just next year, but over the next five years. Looking forward, 2024 holds a blend of challenges and opportunities for Knoxville real estate. While Realtor.com’s 2024 forecast predicts a 5.9% dip in home sales, it concurrently anticipates a promising 7.2% rise in home prices. These projections, coupled with the East Tennessee REALTORS®’ forthcoming annual forecast, paint a picture of a market adjusting to evolving economic conditions.

Apartment Rent Growth and Student Housing Market

The rental market in Knoxville is also witnessing notable trends. October saw a continuation of accelerated apartment rent growth, with a 4.14% year-over-year increase across the Knoxville Metropolitan Statistical Area (MSA), significantly outpacing the national average. Additionally, the University of Tennessee’s student housing market ranked No. 11 nationally for rent growth in Fall 2023, marking a substantial 15.9% increase from the previous school year.

Knoxville’s Housing Market: Speed and Pricing

In the fast-paced Knoxville market, homes are selling swiftly. In October half of the homes sold were under contract in 12 days or less, indicating a slight fluctuation from previous periods. Remarkably, 26% of homes sold for more than the asking price, underscoring Knoxville’s competitive real estate environment.

Housing Market Dynamics and Inventory Trends

Despite challenges like limited inventory and affordability, the East Tennessee housing market is adapting. November witnessed a seasonal rise in housing inventory, with an 8.7% year-over-year increase in active listings across the region. This trend indicates a gradually improving market landscape as we move into 2024.

Knoxville’s Labor Market and Economic Factors

The economic backdrop of Knoxville’s real estate market remains strong, despite broader uncertainties. Knoxville’s labor market, as per the Bureau of Labor Statistics (BLS), continues to outperform, ranking among the top U.S. metros for job growth. RealPage Analytics reports a 3.7% increase in Knoxville’s employment base in the year ending October 2023, well above the metro’s long-term average.

Mortgage Rates and Economic Outlook

The mortgage landscape has seen dramatic shifts, we saw rates over 8% earlier in the year and as of today, according to Mortgage News Daily, the 30-year fixed mortgage rate is at 7.02% (UPDATE! One day later we are down to 6.62%!). This rate, while higher than last year’s average, reflects recent market adjustments. The Federal Reserve’s decision not to pursue another rate hike further shapes a cautiously optimistic economic outlook for the National, Knoxville and East Tennessee real estate markets. Many experts believe the FED will cut rates in 2024 leading to mortgage interest rates dropping as well. If that does happen, and you are a homebuyer, there is a Catch 22. Should interest rates fall, inventory will fall along with it, and competition will rise. That may seem counterintuitive but here is what the data shows. (show graphic). When looking at the data since 2016, you can clearly see that when we are in an environment of rates falling, inventory falls and vice verse. Therefore lower rates will stimulate increased demand from buyers leading to more competition, and lower supply… and what does the law of supply and demand tell us about what low supply and high demand will do to home prices? That’s right, it will make them rise. So if that’s the case, is it better to wait until that happens to buy a home, or buy now when competition is lower and there is more inventory available to choose from? We remember what it was like a few years ago when competition was fierce. I don’t think anyone wants that again, but rates dropping could bring it back.

Comment below or contact me, Troy Stavros, directly with questions or if I can help in any way. Call or text 865-999-0925.