Residential property vacancy rates are a data set that usually fly under the public radar. It’s sort of wonky, they’re several ways to slice and dice it. But it’s also a good resource to get a peek under the housing market’s covers to see what’s going on. And there’s interesting stuff going on in some NE Tennessee counties.
Let’s start with the big picture
During Q3 this year 2.3% of residential properties in Carter, Greene, Hawkins, Johnson, Sullivan, Unicoi and Washington counties were vacant. That’s above the 1.6% national rate but in line with Tennessee’s 2.5% rate. This comes from RealtyTrac’s current Residential Property Vacancy and Zombie Foreclosure Report, and the number crunching was done by Attom Data Solutions.
Here’s how that breaks down by county, by the number of Q3 vacancies and the year-over-year change.
Carter – 534, up 75.1%
Greene – 1,265, up 6.8%
Hawkins – 1,010, up 92.4%
Johnson – 262, up 31.7%
Sullivan – 1,286, up 25%
Unicoi – 265, down 9.9%
Washington – 786, down 5%
The year-over-year U.S. rate change down 9% from Q3 last year while Tennessee saw a 14% increase.
It’s fairly obvious that Unicoi, Washington, and Greene counties pulled the region’s vacancy rate down to the 2.3% respectable level.
Zombie foreclosures are covered in a separate report. You can rest peacefully. The local housing market has been very successful in getting rid of its zombie. CLICK HERE
If you want to look at the real housing market vacant properties action, check out the non-owner occupied category. This is where you’ll get a glimpse of investor (individual and institutional are not broken out) influences. Some of those investors are flippers who flip to sell. Others flip and use the properties as rentals. Other investors just buy rentals when the price is right. Attom’s numbers are residential properties 1-to-4 units.
Here’s what the drill down looks like by number of vacant investor properties and the vacancy rates and the quarter-over-quarter change:
Carter – 449, 4.7%, up 14%
Greene – 1,094, 6%, up 6.8%
Hawkins – 870, 5.9%, up 6.9%
Johnson – 229, 3%, up 1.3%
Sullivan – 1,093, 3.5%, up 4.6%
Unicoi – 231, 5.2%, down 6.1%
Washington – 676, 3.1%, down 1%.
The regional vacancy rate is 4.3% – the same as the Q3 national rate. Tennessee’s rate was 5.1%.
Depending on how many properties owned, it’s not a good time to be in that business in Carter Co. Of course, if you own 10 rental properties and two are vacant the return on investment will carry the loss from those that are vacant. It’s another story for investors who don’t have a numbers safety net – especially if they’ve financed their rentals.
Sullivan is an interesting case. It added quite a few rental properties and more coming online next year in the form of several big apartment complexes. Since it, like most other counties in NE Tennessee, have a higher death rate than birth rate attracting new residents is the only population growth option. On the surface, it looks like next year will be a pretty good time to be a renter in that county since there’s going to be a lot more supply coming on line to what was added last year and this year.
At the other end of the spectrum, Washington County has considerable fewer investor vacancies and its rate is down from last year. So, for at least this one snapshot of time, it’s a better rental investment climate. According to Census estimates, it also has the advantage of being the county that has captured almost all of the region’s population migration for the past two years.