Tennessee’s housing market remained stable overall during the second quarter as home sales and inventory increased in the state’s three largest metropolitan areas.
Murat Arik, director of MTSU’s Business and Economic Research Center in the Jones College of Business, authored the quarterly report, which examines housing activity across Tennessee, including home sales, prices, construction permits, vacancies, foreclosures and mortgage delinquencies.
Home closings increased in Nashville, Memphis and Knoxville during the quarter, with Knoxville recording the largest gains both quarterly and annually. Inventory also increased in all three markets, indicating more homes were available for sale.
Tennessee home prices increased 0.13% during the quarter and 2.7% from a year earlier. While those increases trailed national growth, home prices increased annually in every Tennessee metropolitan statistical area.
Residential construction also strengthened during the quarter. Multifamily permits increased 15.76%, while total residential permits rose 6.44%. Tennessee’s annual growth in total permits also outpaced declines across the South and the U.S.
The state’s homeowner vacancy rate declined by 0.2 percentage points during the quarter.
Housing-related tax collections also increased. Real estate transfer tax collections rose 12.5% during the quarter, while mortgage tax collections increased 24.7%. Mortgage tax revenue was also 25.8% higher than during the second quarter of 2025.
Mortgage delinquency rates increased both quarterly and annually in Tennessee and across the U.S.
Foreclosure activity improved during the second quarter, with foreclosure rates declining by 0.04 percentage points in both Tennessee and the U.S. Tennessee’s foreclosure rate also remained slightly below its level from a year earlier.
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