Read on Twitter
1/ Some housing economics for you.
Here's a visual showing how supply constraints could impede the Knox housing market.
Pended listings (i.e. under contract) is a forward-looking indicator for home sales — right now, active and pended listings are falling at a similar rate.
Here's a visual showing how supply constraints could impede the Knox housing market.
Pended listings (i.e. under contract) is a forward-looking indicator for home sales — right now, active and pended listings are falling at a similar rate.
2/ If inventory continues to fall 
and home prices rise 
— as this visual shows — basic laws of supply and demand dictate total home sales will begin to decrease.
This is especially clear in the gray highlighted region where months' supply has been <2.
and home prices rise — as this visual shows — basic laws of supply and demand dictate total home sales will begin to decrease.This is especially clear in the gray highlighted region where months' supply has been <2.
3/ An obvious solution here is to increase the housing supply. But the supply of homes is relatively inelastic (or fixed) in the short-term.
Homebuilders are operating at full capacity. The cost of production and materials is rising. Planning restrictions prevent quick turnover.
Homebuilders are operating at full capacity. The cost of production and materials is rising. Planning restrictions prevent quick turnover.
4/ This constraint on supply comes at a particularly inopportune time for Knoxville. Demand for homes is higher than ever and growing.
The Biden admin has announced many well-intentioned initiatives to improve access to homeownership, bringing even more buyers into the market.
The Biden admin has announced many well-intentioned initiatives to improve access to homeownership, bringing even more buyers into the market.
5/ All indicators suggest the surging demand for homes will continue growing, especially with interest rates predicted to hover around 3% in 2021. In other words, demand is near insatiable which is reflected by people's willingness to accept higher prices.
6/ But you can't sell homes that don't exist — which is to say a lack of available homes for sale will inevitably lead to fewer purchases in the short-term.
Knoxville's housing market will be rich with demand in 2021 — the crucial question is whether we can meet that demand.
Knoxville's housing market will be rich with demand in 2021 — the crucial question is whether we can meet that demand.
7/ The short-term answer is no. Bolstering the supply of homes is a long-term variable — but right now we should absolutely be considering ways to support new construction and enable higher-density development in areas well-suited for it.
8/ We also need to consider evolving consumer preferences, looking beyond the framework of simply more detached, single-family homes.
Conversations around mixed-density development and new models for housing a growing and changing population have never been more important.
Conversations around mixed-density development and new models for housing a growing and changing population have never been more important.
9/ Visual showing active listings and median sale price for the Knoxville area: https://twitter.com/hancen4sale/status/1354827154706608131
10/ Thread looking at how pandemic-related economics disparities impacted the housing market, leaving those already struggling to attain homeownership facing even greater obstacles: https://twitter.com/hancen4sale/status/1354806230284345357
