adventures in knoxville real estate by suzy trotta

Knoxville November 2008 Home Sales Report

It’s the middle of December, which means the Knoxville Area Association of Realtor’s numbers are finally out for Knoxville’s November home sales. And trust me, I wish I had some Christmas cheer to spread, but I keep  reaching into this Home Sales Report stocking and all I’m pulling out is coal.

In case you’ve already forgotten all about November 2008, let me refresh your memory: Barack Obama won the presidential election; Germany & Japan officially went into recession; the US announced another rescue package, this time for Citigroup; and the Federal Reserve announced it would inject another $800 billion into the US economy to try to stabilize our flailing financial system. It was basically more fun than a barell full of monkeys. Very over-leveraged, cash poor, soon to be foreclosed on monkeys.

So, how did the Knoxville real estate market fare through all of that doom and gloom? Well, not too great. So, sit back, relax, and let me break it to you gently – All Around KTown style.

You know I like to start with the good news first –

Median sales price for 2 or less BR homes is up.
Nov ’07 – $80,500
Nov ’08 – $87,000

2008 is almost over.

Now for the not-so-good news:

Average sales price for 2 or less BR homes is (way) down.
Nov ’07 – $99,200
Nov ’08 – $85,900

Average sales price for 3 BR homes is (way) down.
Nov ’07 – $167,600
Nov ’08 – $155,800
Median sales price for 3 BR homes is down.

Nov ’07 – $147,700
Nov ’08 – $138,900

Average sales price for 4+ BR homes is (way, way) down.

Nov ’07 – $309,700
Nov ’08 – $244,500

Median sales price for 4+ BR homes is (way) down.
Nov ’07 – $249,000
Nov ’08 – $224,500
Median condo sales price is (way) down.
Nov ’07 – $160,000
Nov ’08 – $144,000
Total number of single family units sold is (way, way) down.
Nov ’07 – 1045
Nov ’08 – 659
Total number of condo units sold is (way, way) down.
Nov ’07 -115
Nov ’08 -50
Days on market is up.
Nov ’07 – 96
Nov ’08 – 103
Then we have the ” either somebody bought some really expensive condos and skewed the average condo sales numbers or somebody made a typo” news –
Average condo sales price is through the roof.
Nov ’07 – $184,300
Nov ’08 – $622,700
Then there’s the “yeah, yeah, we get it already, FHA loans rule the universe” news:
Conventional loans were down almost 50%..
Nov ’07 -742
Nov ’08 -328

…while FHA loans were up almost 200%.
Nov ’07- 65
Nov ’08- 125

And here’s the “Hey, maybe if I lower the price, I might actually sell this thing” news –

The average list price for new residential home listings was down.
Nov ’07 – $233,700
Nov ’08 – $224,400

The average list price for new condo listings was (slightly) down.
Nov ’07 – $197,900
Nov ’08 – $197,100
Finally there’s the “Honey, let’s wait until next year to list our house” news –
The number of new residential listings was (way) down...
Nov ’07 – 2134
Nov ’08 – 1780
and so were the number of new condo listings.
Nov ’07 – 250
Nov ’08 -205
So, here’s my completely unscientific analysis:
  1. The Knoxville housing market is definitely feeling the effects of the global financial crisis.
  2. Residential and condo sales are soft as a baby’s bottom.*
  3. FHA continues to rule the lending roost.
  4. A lot of buyers and sellers are choosing to wait until ’09 to jump back into the market.
  5. Lower than low mortgage rates + generally crappy market +  winter + antsy sellers + lowering prices = OMG I wish I had some cash to invest in real estate.
  6. The best gift to get your Realtor this Christmas may be a book on how to write resumes. Yeah, I said it.

If you’re interested in looking at both reports yourself, here is ’07 and here is ’08. Enjoy and please feel free to share your thoughts and observations.

*No need to freak out. Lower average sales price and lower median sales price do not necessarily mean that your personal home has depreciated.

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8 years ago 10 Comments Short URL

Author: Suzy

Hard working Knoxville real estate agent by day. Intrepid Knoxville real estate blogger by night.

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  1. Brian A. says:

    >>Lower than low mortgage rates + generally crappy market + winter + antsy sellers + lowering prices = OMG I wish I had some cash to invest in real estate.

    This assumes that prices are on the verge of turning the corner, which I think is assuming too much at this point.

  2. farragutfirst says:

    If the number of new residential listings is way down, then that is great news. Don’t forget the laws of supply & demand of ECON 101.
    Compare Knoxville to many other MSA in the US and you will see that the inventory numbers elseware are often way way way up. Knoxville’s inventory is going down – this is postive news! Try the glass is half full approach in life!

  3. farragutfirst says:

    Have you noticed that the Knoxville News Sentential is about half the size as it was in 2007. Lets compare the statistics: The Knoxville News Sentential Sunday edition in November of 2007 weighed about 2.4lbs, whereas the average weight of the 2008 edition weighed in at about 1.3lbs. That extrapolates to a 45.8% loss of content (or advertising). Maybe the best Christmas gift for the KNS employee on your list is a book on how to write resumes. Yeah, I said it. – Touché

  4. Robert Roarke says:

    Well, if sellers would finally get off their 2006 listing prices and lower them to the new reality of the market, you would see a lot of higher priced homes start to move again and the market would start to rebound. I’ve been looking for about 1 year, and I am seeing property that has listed for 12 to 24 months at the same prices. When they lower them, it is 2 or 3% as if that was going to get them some offers. When the list prices drop the 25% that the market has actually gone down for the $350,000 to $700,000 homes, there are hundreds of us waiting to buy. That’s what has happened in the rest of the country, and when the realtors and builders in Knoxville stop trying to hold the prices up artificially, the market will rebuild again as buyers actually come back into the market.

  5. farragutfirst says:

    Robert – you make a good point. However, you need to be making offers. You need to offer what you would be willing to pay for a house, not wait for the seller to reduce the price to that number. People are buying houses, and they are getting great deals. Rates are low and there are great houses for sale. If you think a $400k house is worth $350k to you, then make that offer and someone will take it.

  6. Pamela Treacy says:

    I don’t have the numbers in front of me, but the number of homes built over the last couple of years exceed the demand which also caused home prices to decline. I believe the overbuilding is a reason the Knoxville market has softened.

  7. Robert Roarke says:

    I understand what you are saying. However, I have already run into a few situation, where large real estate brokers have refused to even present some offers I was willing to make. I know it is against their rules, but there isn’t much a potential buyer can do to prevent it. Many of the brokers bought up property themselves when prices were climbing, trying to flip it quickly, and got stuck with it. Now if a competing property sells for much less then their property, the comps make it impossible for them to recover their own losses. So they are desperately trying to prevent many properties from actually selling at realistic prices. They are just hoping that things will change and they will personally be able to get out from under their own losses. One new home I have looked at has been listed for $500K for two years. No reduction in price at all in the listing. I’ve tried to offer about $350K with no contingencies, and get no response at all. The broker doesn’t even present the offer or I’d get some sort of counter offer. Thats what is completely killing the market in the Knoxville area right now. In other parts of the country, actual listing and sale prices have dropped by 25% or more, and the number of sales have doubled in the last few months where that has occured.

  8. farragutfirst says:

    Robert-I hear you, but, find it hard to believe that any Realtor worth their salt would not present all offers, regardless of the amount, regardless of written or verbal, to a seller. You state it is against the rules, that is a mild statement. If what you state is true, the agent would be in very serious legal trouble and I STRONGLY encourage you to file a complaint to the TREC (Tenn Real Estate Commish). We don’t need agents like that in Knoxville. With that said, I think it is unlikely that what you state is accurate. Regardless, you need a BUYER’s AGENT, an agent that represents YOU (in writing). From your statements (true or false), you don’t trust your current agent, and it is time to find someone new. Like I said before, if you want a deal on a house, just start making offers. Buying a house that sold in 2006 for $500k for 350k may take some looking. However, you can do it if you are willing to be flexible in what you want and where it is. However, you need to start making offers. To prove what I am saying, just look at the property transfers in the Sunday paper, and then compare the selling price to the listed price (find it online). You will find a few each week that have sold for 25% or more less than the asking price. What is ironic is that this holds true in both a good and bad economy. I can explain why this happens, however, this is already too long. Merry Chrismas

  9. Robert Roarke says:

    I have recently engaged a buyer’s agent from a small local realty firm just for the reasons you state. At least that way, I can have a written offer prepared and presented and it makes it difficult for the seller’s realtor to keep the offer off the table. Believe me that what I say is the truth though. I am intentionally not using the realtor’s involved names because it isn’t worth the aggravation to me to have a fight over it. In one case a several months back, I tried to look at a listed property twice over a week long period and the meeting to see the property was canceled each time the planned morning, by the agent. It was supposidly taken off the market after that. The following week I found that it had been purchased by a realtor working in the office of the agent that was supposed to show me the property. That realtor, did a little clean up work on it and put it right back on the market a month later at more then a 50% increase in the price he had just bought it for himself. It was pretty clear why the meetings to show me the property got cancelled. Its still on the market and that realtor is getting his handed to him now though. There is some really dirty stuff going on out there right now, but I know that I will find the property that is right for me, and since I can pay cash if neccessary, and I have some time left, I figure I’ll just wait it out a little. Thanks for the advice.

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