Tennessee’s housing market showed mixed results across several sectors during the second quarter but remained stable overall as home sales increased in the three major metro areas and inventories expanded, according to the latest statewide report from Middle Tennessee State University.
Murat Arik, director of the MTSU Business and Economic Research Center in the Jones College of Business, is the author of the quarterly report, which provides detailed breakdowns, including housing permits, foreclosures and delinquencies, inventories and employment data, at https://www.mtsu.edu/berc/housing/.
Report highlights include:
• Housing market: Home closings increased in Nashville, Memphis, and Knoxville during the quarter, with Knoxville posting the strongest gains, both quarterly and annually. Inventory also increased across all three markets, indicating continued expansion in available supply. Tennessee home prices rose only 0.13% during the quarter and 2.7% over the year, trailing national growth, although every Tennessee MSA recorded annual appreciation.
• Vacancy rates and housing permits: Tennessee’s homeowner vacancy rate declined by 0.2 percentage points during the quarter. Residential construction strengthened, led by a 15.76% quarterly increase in multifamily permits and a 6.44% increase in total permits. Tennessee’s annual total-permit growth also outperformed declines in the South and the United States.
• Tax revenue: Housing-related tax collections strengthened on both a quarterly and annual basis. Real estate transfer tax collections increased by 12.5% during the quarter, while mortgage tax collections rose by 24.7%. Mortgage tax revenue was also 25.8% above its 2025 second-quarter level.
Mortgages and foreclosures: Mortgage delinquency rates increased during the quarter and year over year in both Tennessee and the United States. Foreclosure activity improved during the second quarter, with rates declining by 0.04 percentage points in both markets. Tennessee’s foreclosure rate also remained slightly below its year-ago level
BERC’s report is funded by the Tennessee Housing Development Agency, or THDA. The quarterly report offers an overview of the state’s economy as it relates to the housing market and includes data on employment, housing construction, rental vacancy rates, real estate transactions and mortgages, home sales and prices, delinquencies and foreclosures.
The Business and Economic Research Center operates under the Jennings A. Jones College of Business at MTSU. For more information, visit http://mtsu.edu/berc/.
