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Knoxville Real Estate Trends: Why Buyers and Sellers Are Flocking to East Tennessee in 2025

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Knoxville, Tennessee, has emerged as one of the hottest real estate markets in the first quarter of 2025, with buyers and sellers showing significant interest in the region. Tennessee continues to rank among the top states for relocation, and Knoxville leads the way as the most searched city in the state for potential movers.

Tennessee: A Top Destination for Relocation

A recent study by U.S. News & World Report highlighted migration trends across the United States in early 2025. Tennessee was among the top three most-researched states for relocation. The study attributes Tennessee’s growing appeal to several key factors:

  • Affordable Cost of Living: Compared to other regions, Tennessee offers a lower cost of living, making it especially attractive for families and retirees.
  • Mild Climate: East Tennessee, including Knoxville, enjoys four distinct but moderate seasons, perfect for outdoor enthusiasts and those seeking a change from harsh winters or scorching summers.
  • Natural Beauty: The Great Smoky Mountains, located just a short drive from Knoxville, provide endless opportunities for hiking, camping, and outdoor recreation.
  • Tax Benefits: With no state income tax, Tennessee is an appealing choice for individuals and families looking to maximize their financial resources.

Knoxville: The Star of Tennessee Real Estate

Knoxville has become a focal point for homebuyers and investors alike. Ranked as the most-searched city in Tennessee for relocation, Knoxville offers a mix of urban conveniences and small-town charm, making it a prime spot for both buyers and sellers.

Why Knoxville?

  1. Booming Real Estate Market: Knoxville’s real estate market continues to grow, with homes selling quickly and demand outpacing supply.
  2. Access to Nature: Its proximity to the Great Smoky Mountains and other outdoor attractions makes it ideal for those seeking a balanced lifestyle.
  3. Thriving Job Market: Knoxville’s economy is bolstered by industries such as healthcare, education, and technology, attracting professionals from across the country.
  4. Cultural Scene: From the Knoxville Symphony Orchestra to vibrant festivals, the city has a rich cultural landscape that appeals to a diverse population.

Other Popular Tennessee Cities

While Knoxville leads the pack, Franklin and Chattanooga also ranked among the most-searched cities for relocation in 2025.

  • Franklin: Known for its historic charm and upscale living, Franklin is a favorite for families and professionals.
  • Chattanooga: With its scenic beauty and strong startup culture, Chattanooga attracts both outdoor lovers and entrepreneurs.

Southern Migration Trends in 2025

The South has become a magnet for movers in 2025, thanks to its affordability, warmer weather, and lower population density. Alongside Tennessee, states like South Carolina, North Carolina, and Alabama are seeing increased interest.

For buyers and sellers in Knoxville, this influx of newcomers creates an exciting opportunity. Buyers can find affordable homes in a growing market, while sellers can take advantage of high demand to maximize their home’s value.

Ready to Make Your Move?

Whether you’re buying or selling in Knoxville, now is the time to act. Knoxville’s real estate market is thriving, and its appeal as a relocation destination continues to grow. Contact a local real estate expert today to take advantage of these trends and find your dream home in East Tennessee!

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.

JUNE 2023 Knoxville Real Estate Market Update: Rising Rents, Home Prices, and Mortgage Rates

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Welcome to the Knoxville Real Estate Report! In this video, we’ll dive into the latest trends and insights shaping the housing market in our beautiful city.

First, let’s talk about apartment rents. Over the past year, Knoxville has seen a remarkable increase of 9.2% in apartment rents, outpacing the national average growth of 2.3%. This means that finding a place to rent in Knoxville has become more competitive, and prices are on the rise.

In June, the Federal Reserve decided to keep interest rates steady after a string of ten consecutive rate increases. However, officials hinted that future rate hikes may be necessary next month if inflation doesn’t continue to decrease. This decision has implications for the housing market, as higher interest rates can impact the affordability of homes and influence buyer behavior.

Speaking of the housing market, East Tennessee has experienced a notable increase in housing inventory throughout June. However, the number of homes listed for sale remains approximately 60% lower than pre-pandemic levels. This shortage of available homes contributes to the high prices and rents we are currently seeing in the region.

The recently released “The State of the Nation’s Housing 2023” report from the Harvard Joint Center for Housing Studies confirms that home prices and rents remain high in East Tennessee. With higher interest rates locking homeowners in place and slowing construction, the market faces challenges in meeting the demand for affordable housing.

Home sales in Knoxville saw a boost in May, partly due to a temporary decline in mortgage rates the previous month. Buyers in today’s market are highly sensitive to mortgage rates, and their fluctuations can impact home sales in the coming months. Additionally, the lack of inventory and new listings has intensified competition, especially for homes priced under $400,000.

In summary, while market activity has somewhat normalized, the housing market in Knoxville is still far from ordinary. Higher mortgage rates and historically low inventory levels create a dynamic that is unfamiliar territory for many. Although the situation may seem unsustainable, data suggests that these market conditions are likely here to stay.

Looking at housing inventory, we observed a modest increase over the past month, which is typical for this time of year. Active listings in June were up around 20% compared to the previous year. However, inventory levels remain well below pre-pandemic averages across all counties in the East Tennessee region. Although most counties experienced month-over-month increases in inventory, the growth was relatively subdued compared to historical trends.

Now, let’s talk about mortgage rates. Currently, rates are just over one percentage point higher than they were a year ago, resulting in a 20% increase in the required monthly payment for the median-priced listing. These higher rates have led many homeowners to hold off on selling their homes and moving, contributing to the low inventory we’re seeing in the market. As a result, prospective buyers are increasingly turning to the new-home market.

Looking ahead, the outlook for mortgage rates remains uncertain. Despite the Federal Reserve’s decision to pause rate hikes in June, there is a possibility that rates will resume their upward trend in the near future. With inflation still above the Fed’s target, it’s likely that rate increases will be on the horizon. As a result, mortgage rates are expected to hover around 6.5% throughout the summer months.

In Knoxville, only a small percentage of homes listed for sale have a lower estimated monthly payment compared to a year ago. This indicates that while home price growth has slowed, it remains positive, and lower monthly payments are limited to a few listings at the top end of the market. That wraps up our Knoxville Real Estate Report. Stay tuned for more updates on the local housing market. If you found this information valuable, be sure to like this video and subscribe to our channel for future updates. Thanks for watching!

Have questions? Need a market analysis on a particular part of town or home? Need help buying or selling a home in East Tennessee? Contact Troy Stavros with CornerStone Realty Associates at 865-999-0925 today!