In the Knoxville, TN market in July, closings of new homes declined year-over-year, and there were hints of worsening market conditions as the percentage fall was steeper than June 2016. New home closings saw a drop of 83.1% from the year earlier to 15. This came after a 71.6% decline year-over-year in June.
A total of 403 new homes were sold during the 12 months that ended in July, down from 477 for the year that ended in June.
Out of all housing closings, new home closings made up 1.6%. This is a drop 6.7% of closings a year earlier. After rising year-over-year in June, closings of new and existing homes sank year-over-year in July.
Pricing and Mortgage Trends
For newly sold homes, the average price fell 18.0% year-over-year in July to $234,754 per unit. This decline compares to a period of relatively little movement in June from a year earlier.
Average mortgage size on new homes declined year-over-year in contrast to new home prices. In July 2016, average mortgage size on new homes sold was $169,748, down 30.1% from a year earlier. It went from $206,368 to $205,420 from June 2015 to June 2016.
Other Market Trends
There was no change in the composition of the new home market with regard to the types of properties sold in July 2016. Single-family home closings have accounted for 93.3% of new home closings while attached unit closings have made up 6.7% of closings.
The average unit size of newly sold homes fell 30.3% year-over-year to 1,795 square feet in July 2016. In June, the average size of new homes sold went from 2,200 square feet a year earlier to 1,729 square feet.
Foreclosures and real estate owned (REO) closings continued to drop from a year earlier in July, but did not look to be a burden on the market. Combined, foreclosures plus REO closings made up 12.0% of existing home closings, below 16.6% a year earlier. The percentage of existing home closings involving foreclosures dropped to 5.9% in July from 6.9% a year earlier while REO closings as a percentage of existing home closings declined to 6.1% from 9.7% a year earlier.