Sullivan Co. new home construction edges ahead of Washington Co. as permits decline


Washington Co. continues to lead region for new high-end homes 

By DON FENLEY

The Tri-Cities new home industry gave up last year’s gains, according to the newly released market summary from The Market Edge.

Q3Compared to Q3 last year, year-to-date new residential permit totals for the first nine months of this year are down 19.4% compared to last year. But there are some interesting developments when you drill down the numbers to the county levels.

The Knoxville and Asheville areas were the only markets posting gains, and Knoxville barely got in that game with a 0.2% increase. Asheville led the region with an 8.5% increase. The Chattanooga region was down 0.3%.

Only two Tri-Cities counties – Carter and Hawkins – are positive for Q3 compared to the same period last year.

Washington Co, TN – the region’s leading new home market – is down 28.9% this year. Sullivan Co. is down 18.5%. The trendline for these two counties is one of the report’s surprises. For the first time since 2008 more new home permits are being pulled in Sullivan than Washington Co. The spread between the two counties has been narrowing since 2012 and Sullivan County edged ahead in Q3.

Sullivan County’s new home momentum also showed up in the Kingsport-Bristol jobs reports. Construction saw a double-digit gain in September compared to the same month last year. And that sector has outperformed the other job categories since spring.

At the same time, construction jobs have been flat in the three-county Johnson City MSA since the first of the year as new home construction contracted.

The rule of thumb is the new home industry accounts for two new jobs for every house built.

So far this year, 38 high-end homes have been built in the Tri-Cities, down from 51 last year.

The Market Edge defines a high-end home as one that is 4,000 sq. feet or more or has a construction cost over $400,000.

Washington Co. TN maintained its dominance in this category with 15 of the high-enders. Washington Co. VA had 11. Sullivan Co. saw six permits for high-end homes. During the first nine months of last year the total was 18.

 © Don Fenley

Comments

  1. Linda Blevins says:

    Do you think we will ever see the red and blue 2008 lines on the above graph ever at that level again?

  2. donfenley.com says:

    Hard to say. Something would have to change to drive that much new home construction.

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