Drop in home prices unlikely in Knoxville; buyers get risk and sellers get reward | Haun
In the past 24 months, there have been many conversations about how “hot” the real estate market is, not only in Knoxville, but nationwide.
Now, the conversation is changing, and we are beginning to hear things we hoped to never hear again like “housing bubble” and “market crash."
Thankfully, there are major differences in today’s market and that of 2008 that would indicate we are not in a housing bubble but possibly one that will be slowly corrected.
Over the past two years, we have seen a 34% increase in home values. New construction projects continue to thrive and homebuyers far outnumber homes for sale.
While not everyone in the real estate and finance world can agree about a potential housing “bubble," one thing they can agree on is that it is still a fantastic time to sell real estate. Because inventory remains low, we literally have buyers waiting on homes to become available for purchase, and many sales in our area are still experiencing multiple offers; a reduction of contingencies and inspections; and, in fact, an overall decrease in buyer expectations.
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The negotiations are more complicated right now, and seasoned agents are actually able to be creative enough to craft an attractive deal.
In many situations, we are seeing that buyers who win the deal in a multiple-offer situation are the ones who have waived financing, appraisal and inspection contingencies and are willing to put down a large amount of earnest money.
As a listing agent, these are great terms because I can present sellers with a high price and a contract with terms offering very little risk. As a buyer’s representative it is more difficult to counsel your client because many times the winning offer does involve fewer contingencies — and because of that, there can be major risks involved for the buyer client.
Like all markets, real estate is always shifting. In parts of the country, the number of showings are down, days on market are starting to slowly rise and prices are starting to level out.
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Fortunately, Knoxville is not experiencing this type of shift yet. We are still seeing listings that leave the market in record time and close with strong numbers. Some of this is still fueled by a surge of out-of-state buyers.
The best way to navigate through an ever-shifting real estate market is simply to rely on your real estate agent, make sure they’re educated on the market and be positioned to react quickly.
The rapid rise of interest rates will put some on the sidelines for a brief time, but the reality is we still have a major housing shortage and a huge demand for in our area, so it’s unlikely to see sales or values decline rapidly anytime soon.
Lucas Haun is a luxury agent for Keller Williams Realty and Knoxville News Sentinel’s ASK THE EXPERT. He can be reached at 865-588-9300.
This article originally appeared on Knoxville News Sentinel: Knoxville homes for sale won't drop prices in this real estate market
