In the Knoxville, TN market, closings of new homes slid year-over-year in July, but the percentage fall was an improvement from June 2015, suggesting the market may be leveling out. New home closings saw a 63.8% drop from a year earlier to 25. This came on the heels of a 72.9% decline year-over-year in June.
A total of 312 new homes were sold during the 12 months that ended in July, down from 356 for the year that ended in June.
As a percentage of overall housing closings, new home closings represented 2.0%. This is a fall 6.2% of closings a year earlier. Following a year-over-year increase in June, closings of new and existing homes also increased year-over-year in July.
Pricing and Mortgage Trends
The average price of new homes declined 8.0% year-over-year in July to $251,805 per unit. This drop is larger than the 6.9% decline in June from a year earlier.
The average mortgage size on newly sold homes dropped year-over-year in contrast to the average price of new homes. Average mortgage size fell by 12.8% from a year earlier, settling at $197,968 in July. Average mortgage size declined 22.7% in June 2015 from a year earlier.
Other Market Trends
The share of new home closings made up by attached units has risen while the share belonging to single-family homes has fallen. The share of new home closings belonging to attached units gained from 13.0% of closings in July 2014 to 20.0% of closings in July 2015. Conversely, the share belonging to single-family homes declined to 80.0% of closings from 87.0% of closings.
The average unit size of newly sold homes sank 24.2% year-over-year to 1,850 square feet in July 2015. In June, the average size of new homes sold went from 2,117 square feet a year earlier to 1,678 square feet. A decrease in both the average size and price of newly sold homes was also seen in June 2015 when the average size climbed 20.7% to 1,678 square feet.
Foreclosures and real estate owned (REO) closings continued to fall from a year earlier in July, but did not look to be a burden on the market. Combined, foreclosures plus REO closings accounted for 16.1% of existing home closings, below 23.8% a year earlier. The percentage of existing home closings involving foreclosures dropped to 6.5% in July from 9.9% a year earlier while REO closings as a percentage of existing home closings declined to 9.6% from 13.9% a year earlier.