Knoxville, TN Housing Market

Market Overview

Knoxville’s PropertyIQ Score of 25 out of 100 places the market in a relatively weak position compared with benchmark expectations. While the score alone suggests soft conditions, the underlying data shows a mixed picture. The median home value in Knoxville is $364,988, which is about $30,880 above the state average of $334,108. The rent index is also significantly higher at $1,738, compared with the state average of $1,189, and the median household income is $72,422, roughly $2,827 above the Tennessee average of $69,595. The unemployment rate matches the state average at 3.4%, which is a stable labor market signal.

However, the top score drivers help explain the low PropertyIQ Score. The 12-month home value momentum is 4.09%, but the 3-month momentum has turned negative at -0.79%. The reported home value year over year is $0, which points to flat annual appreciation by that measure. Median days on market is 58 days, and 26.0% of listings have had a price cut. These indicators suggest cooling short-term demand and a market where sellers are adjusting expectations. With 3,658 homes for sale, Knoxville appears to have a relatively active inventory environment, but the momentum and pricing signals keep the overall score weak.

Key Trends

One clear trend is cooling home value momentum. The 12-month home value momentum of 4.09% shows some prior appreciation, but the 3-month figure of -0.79% indicates a recent pullback. The home value year over year reading of $0 reinforces that annual price growth is flat by that metric. Together, these numbers suggest that Knoxville’s home values have lost near-term upward momentum even if the longer window was mildly positive.

A second trend is the shift toward a more buyer-friendly market. With 3,658 homes for sale, a median days on market of 58 days, and 26.0% of listings showing a price cut, sellers are facing more competition and longer selling timelines. The elevated share of price cuts indicates that many sellers are having to adjust their asking prices to attract buyers, which is not typically a sign of a strong seller’s market.

Affordability is another important trend. Knoxville’s median home value of $364,988 is about 9% above the state average, while the median household income of $72,422 is only about 4% above the state average of $69,595. In other words, local incomes are slightly higher than the state norm, but home prices are even higher relative to that benchmark. This gap can create affordability pressure for local buyers.

Finally, the rental market stands out as a relative strength. Knoxville’s rent index of $1,738 is about 46% above the state average of $1,189. That is a significant premium and suggests strong rental demand or a limited rental supply compared with the rest of Tennessee. For a market with weak home price momentum, this rental strength is a notable counterbalance.

Who Is This Market For

Knoxville may suit patient first-time buyers who can take advantage of softer conditions. The median home value of $364,988 is above the state average, and the median household income of $72,422 may make affordability tight, but the 58-day median days on market and 26.0% share of listings with a price cut give buyers more negotiating room than in a fast-moving market. First-time buyers who are financially prepared and willing to negotiate may find opportunities that were less available during stronger price momentum.

Rental property investors may also find Knoxville interesting because the rent index of $1,738 is far above the state average of $1,189. That rent premium can support cash-flow-focused strategies. However, the PropertyIQ Score of 25/100 and the negative 3-month home value momentum of -0.79% suggest that investors should not rely on rapid appreciation. This market is better suited to long-term rental investors who prioritize income over short-term equity gains.

Move-up buyers may face a more mixed environment. The weak near-term price momentum and flat annual home value reading mean that sellers may not be building equity quickly. At the same time, they may benefit from negotiating on their next purchase because of the price cuts and longer market times. Population growth data is not available, so migration-driven demand cannot be evaluated here.

Outlook

The near-term outlook for Knoxville is cautious. The negative 3-month home value momentum of -0.79%, the flat year-over-year home value of $0, and the 26.0% share of listings with a price cut all point to continued softness in pricing power. A median days on market of 58 days and 3,658 homes for sale suggest that buyers will likely retain some negotiating advantage in the short term. That said, the 3.4% unemployment rate and the strong rent index of $1,738 provide foundational support. The 12-month momentum of 4.09% shows that the market has not been uniformly weak, but the recent cooling signals that sellers should expect a competitive environment rather than rapid price growth.