In the Knoxville, TN market, new home closings dropped year-over-year in February, and the percentage decline was more severe than January 2016, indicating the market may be worsening. New home closings saw a 57.1% fall from a year earlier to 24. This came on the heels of a 37.5% decline year-over-year in January.
A total of 654 new homes were sold during the 12 months that ended in February, down from 686 for the year that ended in January.
New home closings represented 3.6% of overall housing closings. This is down from the 7.7% of closings a year earlier. Closings of new and existing homes saw a decline year-over-year in February after remaining steady in January year-over-year.
Pricing and Mortgage Trends
The average price of newly sold homes increased year-over-year 11.3% in February to $289,846 per unit. This lift is higher than the 8.3% hike in January year-over-year.
For newly sold homes, the average mortgage size saw a rise year-over-year along with new home prices. It increased 11.5% in February from a year earlier to $250,501. In January 2016, average mortgage size on newly sold homes saw a 23.6% lift year-over-year from a year earlier.
Other Market Trends
As a percentage of new home closings, attached unit closings have gained from last year while single-family home closings have dropped. The share of new home closings belonging to attached units gained from 7.1% of closings in February 2015 to 16.7% of closings in February 2016. Meanwhile, single-family home closings as a percentage of all new home closings slid to 83.3% of closings from 92.9% of closings.
For all new homes sold, the average unit size dropped 4.3% year-over-year to 2,264 square feet in February 2016. For newly sold homes, an average size drop contrasting with an average price boost was also seen in January 2016 when the average size of newly sold homes declined 21.0% to 1,875 square feet. The average size of newly sold homes moved from 2,373 square feet in January 2015 to 1,875 square feet in January 2016.
Foreclosures and real estate owned (REO) closings continued to decline from a year earlier in February, but did not appear to be dragging the market. Foreclosures and REO closings, taken together, accounted for 22.4% of existing closings, lower than 25.9% a year earlier. The percentage of existing home closings involving foreclosures went from 12.1% in February 2015 to 11.3% in February 2016 and REO closings as a percentage of existing home closings slid to 11.0% from 13.8% a year earlier.