By DON FENLEY
TRI-CITIES, Tenn. – Investors perked up third-quarter Tri-Cities cash home sales, according to ATTOM Data Solutions. At the same time, buyers who have retreated took a bite out of FHA sales.
Nationwide, cash sales accounted for 35.7% of all single-family home and condo sales during the third quarter. That’s less than the local share, which is down from historical levels of 50% plus in 2011, 2012, and 2013. According to ATTOM’s report, the higher share of cash sales was in Columbus, Ga. (76.8%), Augusta, Ga (76.6%), Gainesville, Ga. (68.3%) Myrtle Beach, SC (67.3%) and Atlanta, Ga (61.9%)
ATTOM’s third quarter Homes Sales Report says there were 728 Tri-Cities all-cash sales during Q3. The three-county Johnson City metro area had 314 cash sales, accounting for 37.3% of existing sales.
Most of the cash sales (414) were in the four-county Kingsport-Bristol metro area. That was 39.7% of that metro area sales and a 9% increase from this time last year. While cash deals are common for both local markets, an uptick in investor and institutional investor sales are the drivers of the Kingsport-Bristol increase. A precise count of all investor sales is unavailable; however, there were 52 institutional investor sales. That was down slightly from Kingsport-Bristol’s previous quarter but 4% higher than last year.
Institutional investor sales are those made to non-lending entities that purchased at least 10 properties in a calendar year. Activity began increasing last year when demand for rental units increased as flippers and investors moved to cash in on unmet demand for existing home sales. Kingsport-Bristol saw more investor activity because it had a stock of lower priced home that attracted investors and wholesalers.
There are currently 65,983 single-family and condo rentals in the Tri-Cities. The region’s occupancy rate for those properties is almost 98%. And there are 6,441 apartments, with several new projects in the development stages. The National Association of Realtors (NAR) and Tri-Cities Apartment Association (TCAA) recently reported that the Tri-Cities 96.7% occupancy rate for apartments was the second highest in East Tennessee. Only Knoxville had a higher rate.
Cash sales totals in ATTOM’s report are more than those reported by the Northeast Tennessee Association of Realtors (NETAR). That’s because NETAR’s report is based on sales from listing on the regional Multiple Listing Service (MLS), while ATTOM’s report comes from recorded sales deeds, foreclosures filings, and loan data.
FHA sales data is more representative of seasonal conditions and a market slowly pulling back from its previous hectic pace. NETAR sales data show the monthly sales trend has begun slowly tracking the pre-pandemic 2019 sales pattern in the wake of the FED’s efforts to control inflation by cooling down the housing market.
Categories: REAL ESTATE