Tennessee Home TN

Currently both Tennessee’s as well as the housing markets of the nation have incurred losses in form of considerable foreclosures, lowered home prices and lesser sales with substantial implications rates and recovery prospects in housing market. Within Tennessee, some markets are weak whereas others have retained some strength. Tennessee has witnessed decline in prices in majority of markets, depreciating at an average rate of 3.89 percent from the second quarter of 2008 to the second quarter 2009. The Nashville and Memphis Markets have witnessed consistent declines in terms of prices over these quarters. The other markets have not witnessed declines and are still appreciating in prices.

Decline in home prices lead to a fall in borrowers’ equity causing negative levels, which make them unable to refinance a mortgage. Hence with home prices declining, foreclosures would increase which would further depress the already lowered home prices by boosting the inventory of homes. But, from an affordability viewpoint, declining prices enhance affordability for those who enter the housing market.

Tennessee Housing Development Agency provides a range of programs for alleviating housing problems which Tennesseans face. These programs include low income housing tax credits, homelessness services, mortgage/down payment assistance, as well as homebuyer’s education.

Lowered home sales were usual across most counties. However among urban areas, the Knox County home sales experienced increase from last year. The single family home sales improved to 3,800 in 2008 from 2,916 in 2007.Forty-six states experienced depreciated home prices in a year ending in the second quarter of 2009.

In 2009, housing affordability was boosted in certain Metropolitan Statistical Areas as compared to 2008. More and more people in various occupations were able to purchase single family homes. In comparison to 2008, the wage required for buying an affordable home went declining in 2009. This improvement had also been a result of the declining home prices as well as lower mortgage interest rates.

However, if you look at quarterly change from the first quarter to the second quarter of 2009, the HPI experienced home price appreciation in thirty eight states, which suggest the probability of an upward trend. Memphis MSA witnessed 5 consecutive quarters of depreciation, which is more than any other MSA in Tennessee. Along with that, during this period, each quarter’s HPI was lower than other MSAs, which means that even though prices were increasing they were increasing slowly. The Nashville and Davidson MSA witnessed consistent price improvement until the last two quarters of 2009. In the second quarter 2009, HPI for Nashville and Davidson MSA was even lesser than Memphis MSA. This translates into larger house price depreciation.

Apart from the THDA programs which have been operating for a number of years, new programs have also been implemented on the basis of identified needs around Tennessee and as part of the federal housing as well as economic recovery acts. The additional efforts include Neighborhood Stabilization Program which allows purchase or renovation of foreclosed properties in the neighborhoods which are heavily impacted by foreclosures and the Homelessness Prevention and Rapid Re-Housing Program for assisting those with transitory housing instability.