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Knoxville Housing Market Update: The Lock-In Effect Is Finally Easing for East Tennessee Homebuyers

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If you’ve been searching for a home in Knoxville or anywhere across East Tennessee, you’ve likely felt the frustration of limited inventory. The good news? A significant shift in the housing market suggests that more homes could be coming to market soon, offering relief for buyers throughout the region.

What’s Changing in the Housing Market?

The housing market recently reached a notable milestone that signals the mortgage “lock-in” effect is beginning to fade. According to the Federal Housing Finance Agency, more homeowners now hold mortgages with rates at or above 6% than those with loans below 3%. This marks the first time this has occurred since late 2020, during the height of the COVID-19 pandemic.

For Knoxville-area buyers who have been competing for a limited number of listings, this shift could mean more opportunities in the months ahead.

Understanding the Lock-In Effect and Its Impact on East Tennessee

The lock-in effect occurs when homeowners with ultra-low mortgage rates from the pandemic era refuse to sell because purchasing a new home would mean taking on a significantly higher rate. When mortgage rates hovered near historic lows in 2020 and 2021, many East Tennessee homeowners locked in rates below 3%. When the Federal Reserve began raising interest rates in early 2022 to combat inflation, these homeowners found themselves financially incentivized to stay put.

The numbers tell the story clearly. The share of homeowners with rates below 3% peaked at 24.6% in early 2022 and has since declined to 20% by the third quarter of 2025. Meanwhile, homeowners with rates at or above 6% have grown from 7.3% in mid-2022 to 21.2% late last year.

How This Affects Knoxville Home Buyers and Sellers

For prospective homebuyers in Knoxville, Maryville, Oak Ridge, and surrounding East Tennessee communities, the lock-in effect has created real challenges. The scarcity of existing homes on the market has contributed to rising prices and intense competition. Nationally, the median age of first-time homebuyers reached a record 40 years old in 2025, driven in part by existing owners staying in their homes far longer than in previous decades.

The National Association of Realtors reported in its 2025 Profile of Home Buyers and Sellers that the median expected tenure in a purchased home is now 15 years, with 28% of buyers declaring it will be their forever home. This represents a dramatic shift from the period between 2000 and 2008, when sellers typically stayed in their homes for just six years.

Signs of Improvement for the East Tennessee Real Estate Market

While the largest share of outstanding mortgages still falls within the 3% to 4% range, representing almost a third of all loans, the gradual shift toward higher-rate mortgages is expected to bring more inventory to the market over time. Industry experts note this isn’t a dramatic change but rather a meaningful step forward for market activity.

Life circumstances continue to motivate sellers regardless of their mortgage rates. Job relocations, growing families, and financial changes are prompting some East Tennessee homeowners to list their properties even when it means giving up favorable loan terms.

What Knoxville Home Buyers Should Know Going Forward

If you’re considering buying a home in Knoxville or the broader East Tennessee region, here’s what to keep in mind. More inventory is expected to gradually come online as homeowners with pandemic-era low rates eventually need to move for life or financial reasons. Should mortgage rates decline into the mid-5% range or lower, expect a more significant increase in available listings as homeowners become more willing to trade their low rates for a new property.

The East Tennessee housing market remains competitive, but these shifts suggest that patience and preparation could pay off for buyers in 2026 and beyond. Working with a knowledgeable local real estate professional who understands the Knoxville market can help you act quickly when the right opportunity arises.

Whether you’re a first-time buyer in Knoxville, looking to upgrade in Farragut, or searching for property in the Smoky Mountain foothills, understanding these market dynamics can help you make informed decisions about your home purchase.

Looking to buy or sell a home in Knoxville or East Tennessee? Contact Troy Stavros with CornerStone Realty Associates today at 865-999-0925 to schedule a time to talk.

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 & Knoxville Housing Market Update SEPTEMBER 2025: Prices, Trends, and Buyer-Seller Insights

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Are you a homeowner, buyer, or seller looking to understand the latest trends in the East Tennessee and Knoxville housing market? As we approach the end of 2025, market conditions have shifted, interest rates are making waves, and submarkets like Farragut, Lenoir City, and Tellico Village are showing unique patterns. Here’s everything you need to know to navigate the Knoxville real estate market this fall.

Knoxville Housing Market 2025: Cooling but Not Crashing

After years of rapid price growth and frenzied bidding, the Knoxville housing market in 2025 is undergoing a noticeable transformation. Inventory has surged by over a third compared to last year, and homes are staying on the market longer—almost double the days compared to 2024. Sales volume is down nearly 8% year-over-year, and the median home price is now essentially flat, even dipping slightly in some neighborhoods.

Key Takeaway for Home Sellers:
Knoxville sellers must be strategic with pricing and flexible on concessions, as buyers have more options and are no longer rushing to make offers.

East Tennessee Real Estate: A More Resilient Picture

While Knoxville proper is feeling the pinch, East Tennessee’s real estate market as a whole remains resilient. Median prices are up 2-3% year-over-year, and pending sales have benefited from a temporary dip in mortgage rates this fall. Outlying areas such as Lenoir City, Loudon County, and Roane County are seeing steady or even rising demand, absorbing much of the new inventory and maintaining price growth.

Key Takeaway for Buyers:
If you’re priced out of Knoxville, expanding your search to the broader East Tennessee market—especially growing towns and counties—can offer better value and more affordable monthly payments.

Why Outlying Areas Are Booming: Affordability Shifts Demand

One of the biggest trends of 2025 is that outlying communities are capturing buyers who might otherwise have purchased in Knoxville. As the city’s median price outpaces regional averages, many buyers are looking to suburbs and nearby towns for better deals.

  • Farragut: With its top-rated schools and amenities, Farragut remains in demand. However, rising prices and inventory mean homes are staying on the market longer despite a 30% jump in pending sales after the recent rate drop.
  • Lenoir City: This value-driven hotspot is attracting buyers with newer homes and reasonable commutes to Knoxville. Inventory is up, but homes are selling quickly, making for a competitive market.
  • Tellico Village: Known for its active-adult community and lakefront living, Tellico Village is experiencing a surge in inventory and a dip in median sale price, giving buyers more choices and negotiating power—especially for homes needing updates.

Key Takeaway for Investors:
Strong demand in Lenoir City and Farragut, as well as lifestyle-driven buyers in Tellico Village, make these submarkets worth watching for potential appreciation and rental opportunities.

The Role of Mortgage Interest Rates

Mortgage rates have been the wild card in the Knoxville and East Tennessee housing market. Earlier this fall, rates dipped briefly to just over 6%, sparking a surge in pending sales. However, any further increases could dampen both buyer demand and price growth, particularly in Knoxville, where affordability is stretched.

Key Takeaway for Buyers & Sellers:
Watch interest rates closely—lower rates could mean more competition and firmer prices, while higher rates might extend days on market and open the door to negotiation.

Knoxville Real Estate Forecast Through 2026

Looking ahead, the consensus among local experts is that the Knoxville real estate market will continue to normalize. Expect prices to remain flat or post only modest gains, with some neighborhoods possibly seeing slight declines. The broader East Tennessee market, however, is expected to show more resilience, especially in growth corridors and popular commuter towns.

Tips for Success:

  • Buyers: Expand your search radius to include outlying areas for more options and better deals.
  • Sellers: Be realistic about pricing, and consider offering concessions or updates to attract buyers.
  • Homeowners: If you’re not in a rush to move, waiting for rates to drop could bring more favorable selling conditions.

Final Thoughts: Navigating the East Tennessee & Knoxville Housing Market

Whether you’re buying, selling, or simply monitoring property values, staying informed about local trends is essential in a shifting market. Knoxville is correcting faster than the region, but East Tennessee remains a strong bet for homeowners and investors. Keep an eye on interest rates and be ready to act quickly when the right opportunity arises.

Ready to make your move?
For the latest Knoxville and East Tennessee market updates, tips for home buyers and sellers, and expert real estate advice, subscribe to our newsletter or contact us today!

East Tennessee housing market September 2025
Knoxville housing market September 2025
East Tennessee counties housing market September 2025
Farragut TN housing market September 2025
Lenoir City TN housing market September 2025
Tellico Village housing market September 2025

July 2025 East Tennessee & Knoxville Housing Market Update: Inventory Surge Creates New Opportunities

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Market Shifts Toward Balance as Buyers Gain Leverage

The East Tennessee and Knoxville housing markets are experiencing significant shifts as we move through summer 2025. With inventory levels surging across the region and homes taking longer to sell, both buyers and sellers are navigating a markedly different landscape than just one year ago and especially different than the white hot market a few years ago. Here’s what the latest data reveals about our local real estate market through July 2025.

East Tennessee Regional Market: Moving Toward Buyer-Friendly Territory

Key Market Indicators Show Cooling Trend

The broader East Tennessee single-family home market has seen dramatic changes over the past year:

  • Inventory jumped 32.4% year-over-year, providing buyers with significantly more options
  • Absorption rate climbed to 4.75 months (up from 3.68 months in July 2024), indicating a shift toward a balanced market
  • Median sale price remains essentially flat at $374,000 (+0.13% YoY)
  • Average days on market increased to 64 days (up 42% from last year)

Positive Signs Emerge Despite Slowdown

While the market has cooled, there are encouraging indicators:

  • Home sales increased 3.6% compared to July 2024
  • Pending sales surged 19% year-over-year, suggesting stronger activity ahead
  • New listings rose 6.3%, showing seller confidence remains intact

The average sold price per square foot sits at $222, making East Tennessee an attractive option for buyers seeking value in today’s market.

Knoxville Market: Urban Core Shows Greater Resilience

City Market Outperforms Regional Trends

Knoxville’s single-family home market, while experiencing similar pressures, demonstrates stronger fundamentals:

  • Inventory surged 46.9% year-over-year, the fastest growth rate in the region
  • Absorption rate of 2.98 months keeps Knoxville in mild seller’s market territory
  • Median sale price reached $400,000 (+1.27% YoY), showing modest appreciation
  • Average days on market rose to 42 days (up 56% YoY), but still faster than the regional average

Urban Demand Remains Steady

Despite increased inventory, Knoxville benefits from:

  • Concentrated employment centers driving consistent buyer demand
  • Average sold price per square foot of $232, reflecting the premium for urban convenience
  • Stronger negotiating positions for sellers, with homes typically selling at 97-98% of original list price

Farragut Spotlight: Premium Market Faces Unique Challenges

High-End Market Experiences Distinct Pressures

The Farragut (37934) market, traditionally one of the region’s premium submarkets, shows interesting divergence:

  • Median sale price of $682,500 declined 5.57% year-over-year
  • Inventory increased 35.8%, creating more competition among luxury listings
  • Absorption rate rose to 3.22 months, indicating even this desirable area is shifting toward balance
  • New listings dropped 25.7%, suggesting some sellers are waiting for better conditions

What’s Driving These Market Changes?

Multiple Factors Converging

Several forces are reshaping our local real estate landscape:

  1. Affordability Challenges: Higher mortgage rates combined with elevated home prices are limiting buyer purchasing power
  2. Economic Uncertainty: National economic policies, including trade considerations, may be impacting buyer confidence
  3. Seasonal Patterns: The traditional summer buying season hasn’t provided its usual boost
  4. Inventory Accumulation: More homes entering the market than being absorbed creates mounting supply

What This Means for Buyers

Unprecedented Opportunities Emerging

For buyers, the current market presents advantages not seen in years:

  • More negotiating power, especially on homes with 30+ days on market
  • Increased selection across all price points
  • Time to make thoughtful decisions without the pressure of immediate competition
  • Opportunity to request concessions including repairs, closing costs, or rate buydowns

Strategic Buying Tips

  • Focus on homes that have been listed for several weeks
  • Use comparative market analysis to justify offers below asking price
  • Don’t hesitate to request seller concessions
  • Act quickly on well-priced, move-in ready homes in prime locations

What This Means for Sellers

Adapting to New Market Realities

Sellers must adjust strategies to succeed in this evolving market:

  • Price competitively from day one – overpricing will result in extended market time
  • Prepare for negotiation – expect to negotiate 2-5% off original list price
  • Invest in presentation – move-in ready homes still command premium prices
  • Be flexible on terms – consider buyer requests for closing costs or repairs

Pricing Strategy is Critical

  • Review and potentially adjust pricing after 21-28 days if showing traffic is low
  • Consider pre-listing improvements to stand out from increased competition
  • Work with experienced agents who understand current market dynamics

Looking Ahead: Rest of 2025 Outlook

Expected Trends Through Year-End

As we move into fall and winter 2025, expect:

East Tennessee Region:

  • Absorption rate to remain elevated at 4.5-5.2 months
  • Prices to stay relatively flat with selective softening
  • Continued buyer leverage in negotiations

Knoxville Market:

  • Absorption rate around 2.7-3.3 months
  • Modest price appreciation of 0-2% for quality properties
  • Faster sales than regional average to continue

Market-Wide Expectations:

  • Inventory levels to remain elevated through year-end
  • Days on market to potentially increase further during slower fall/winter months
  • More price reductions and seller concessions becoming standard

Bottom Line: A Market in Transition

The East Tennessee and Knoxville housing markets are clearly transitioning from the seller-dominated conditions of recent years toward a more balanced environment. While this shift creates challenges for sellers accustomed to quick sales and multiple offers, it presents long-awaited opportunities for buyers who have been sidelined by fierce competition and rapidly rising prices.

Success in this market requires understanding these new dynamics and adjusting strategies accordingly. Sellers who price realistically and present their homes well can still achieve their goals, while buyers who act strategically can finally find value and negotiating power in their home search.

Whether you’re buying or selling in East Tennessee, working with an experienced real estate professional who understands these evolving market conditions is more important than ever. The market has changed, and your strategy should too.

Knoxville & East Tennessee Housing Market Update February 2025: What Buyers & Sellers Need to Know

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The East Tennessee and Knoxville housing markets continue to evolve as we move through 2025. According to the latest February data compiled by Cornerstone Realty Associates, the region is showing signs of transitioning toward a more balanced market with some interesting variations across different counties. Here’s a comprehensive analysis of what’s happening in our local real estate market.

East Tennessee Housing Market Overview

When comparing February 2025 to February 2024, East Tennessee shows some notable trends:

  • Home sales: Down 8.5%
  • Pending sales: Up 1.4%
  • Inventory: Up significantly by 33.6%
  • New listings: Up 2.1%
  • Median sales price: $360,000 (up 1.84%)
  • Average price per square foot: $217
  • Absorption rate: 3.59 months (up from 3.58 months)

The absorption rate increase of 29.6% year-over-year suggests homes are taking longer to sell, gradually shifting the market toward a more balanced or buyer-friendly environment. While this indicates buyers now have more options and sellers face increased competition, prices remain relatively stable.

Days on market have increased steadily, now exceeding 65 days across East Tennessee. Though homes are taking longer to sell than last year, demand remains strong enough to sustain gradual price increases.

Knoxville Housing Market Data

The Knoxville metro area presents a somewhat different picture:

  • Home sales: Down 12.6%
  • Pending sales: Down 2.7%
  • Inventory: Up 39.7%
  • New listings: Up 0.2%
  • Median sales price: $408,500 (up 5.42%)
  • Average price per square foot: $230
  • Absorption rate: 2.01 months (down from 2.06 months)

Despite rising inventory, Knoxville remains a relatively competitive market with just 2 months of inventory (a healthy market is typically 4-6 months). With this low inventory level, prices are likely to remain stable or continue rising.

The sold-to-list price ratio remains high at over 97%, indicating homes are generally selling close to asking prices. While negotiation power has slightly increased for buyers, Knoxville continues to be a relatively strong market for sellers.

County-by-County Analysis

Knox County

  • Inventory up 39.8%
  • Pending sales down 4.9%
  • Median sales price: $400,600 (up 4.9%)
  • Price per square foot: $228

Knox County’s housing market is shifting toward a more balanced state with increasing inventory and longer selling times. The absorption rate has risen from 1.56 to 2.03 months, a 30.13% increase year-over-year.

Anderson County

  • Inventory up 34.3%
  • Pending sales up 8%
  • Median sales price: $324,900 (up 8.3%)
  • Price per square foot: $180

The absorption rate has increased from 1.87 to 2.47 months, indicating homes are taking longer to sell. While prices are rising, longer selling times suggest buyers have more leverage than before.

Blount County

  • Inventory up 36.4%
  • Pending sales up 34%
  • Median sales price: $380,000 (up 3.68%)
  • Price per square foot: $235

Blount County’s housing market is transitioning to a more balanced state. The absorption rate has increased from 2.37 to 2.84 months, suggesting homes are taking longer to sell.

Loudon County

  • Inventory up 68.1%
  • Pending sales up 15.9%
  • Median sales price: $417,000 (down 8.33%)
  • Price per square foot: $228

Loudon County is showing the most significant shift toward a buyer’s market. The absorption rate has surged from 2.4 to 3.81 months, a 58.09% increase year-over-year. Loudon County’s market is clearly shifting toward a more buyer-friendly environment.

Roane County

  • Inventory up 32.8%
  • Pending sales up 4.3%
  • Median sales price: $338,000 (up 6.46%)
  • Price per square foot: $179

The absorption rate has increased from 2.18 to 2.9 months, a 33.49% increase. This suggests homes are taking longer to sell, transitioning the market toward a more balanced environment.

Sevier County

  • Inventory up 20%
  • Pending sales down 12.5%
  • Median sales price: $540,000 (down 3.16%)
  • Price per square foot: $261

Sevier County is firmly in a buyer’s market with an absorption rate of 8.75 months, up from 6.58 months (a 32.98% increase). With high inventory and slower sales, buyers have significant negotiating power in this county.

Migration Patterns Affecting the Market

The report also highlights important migration trends affecting the local market:

  • Knox County: Net migration has returned to pre-pandemic levels (5.6 people per 1,000 residents)
  • Loudon County: Still seeing strong migration (27.3 people per 1,000)
  • Sevier County: More people are now leaving than arriving
  • Knoxville Metro Area: Still saw 9,661 net new residents in 2024

Overall, the region continues to attract new residents, though not at the peak levels seen in 2021-2022 when the Knoxville area saw over 18,000 net new residents.

Price Appreciation

Despite the shifting market, East Tennessee continues to see solid price appreciation:

  • Knox County: 2.7% increase year-over-year, 80.7% over five years
  • Loudon County: 2.9% increase year-over-year, 63.8% over five years
  • Anderson County: 6.6% increase year-over-year
  • Blount County: 4.9% increase year-over-year

The Knoxville metro area as a whole has seen a 73.2% price increase over the past five years.

Interest Rates and Market Outlook

Interest rates as of mid-March 2025 are at 6.78% for a 30-year loan, which remains relatively high compared to historical standards. The market analysis suggests that if rates drop below 6.5% and get closer to 6%, we could see a significant increase in demand.

What This Means for Buyers and Sellers

For Sellers:

  • Price competitively from the start to avoid extended market times
  • Be prepared for more negotiation than in recent years
  • Well-priced homes are still selling at strong values
  • Accurate pricing and strong marketing are essential in a shifting market

For Buyers:

  • More inventory means more choices and greater negotiation power
  • Longer days on market allows for better deal-making opportunities
  • Sellers are generally more flexible on pricing and closing terms
  • Well-priced homes in desirable areas still command competitive offers

Conclusion

The East Tennessee and Knoxville housing markets are transitioning toward a more balanced state, with significant variations by county. While inventory is rising and homes are taking longer to sell, prices remain relatively stable in most areas. Sevier and Loudon counties are showing the most significant shifts toward buyer’s markets, while Knoxville proper remains relatively competitive for sellers.

It’s important to remember that real estate is hyperlocal – conditions can vary dramatically between neighborhoods and even individual properties. A specific subdivision or property could defy overall market trends based on its unique characteristics and desirability.

If you’re considering buying or selling a home in East Tennessee, now is an excellent time to consult with a local real estate professional who can provide specific insights for your particular situation and location.