JOHNSON CITY, Tenn. (WJHL) — Developers continue to start more single-family homes in Kingsport and Washington County than they do in Johnson City, and that gap has widened so far this year.
Meanwhile, the average permit value has continued to rise steeply, with Kingsport seeing the biggest increase at 41%. That jump has brought the average value of a new home in Kingsport — at least according to developer figures — nearly equal to Washington County and Johnson City’s averages.
Developers have pulled permits for 645 single-family homes in Washington County, Kingsport and Johnson City combined through the first nine months of 2023 — down from 698 at the same point last year for a decline of 8%.
Behind those totals, though, is a picture that shows Johnson City accounting for much of that decrease, with 148 permits through Sept. 30 this year compared to 188 in 2022. That represents a 21% drop.
Washington County has seen an 8% rise in total permits increase over last year, from 262 in 2022 to 284 so far this year. Kingsport’s total has declined 14% from 248 last year to 213 this year.
The slight slowdown in homebuilding pace comes as housing inventory remains relatively tight. In September, the Northeast Tennessee Association of Realtors reported 2.3 months of inventory in the region. That’s slightly better than the 1.7 months reported a year earlier, but still far below the five to six months of inventory required to create a so-called “balanced market.” Lower than that, and the market is considered a seller’s market — a scenario that typically allows prices to get higher.
Average permit value up $56,383 from 2022
Led by that 41% jump in Kingsport, the average permit price across all three areas increased by 21%. Through September of 2022, it was $266,494. Through the end of last month, the 2023 average was $322,878.
Johnson City showed the second-highest appreciation in permit value, from an average of $284,854 last year to $333,964 this year for a 17% jump. Washington County’s average rose 10% from $290,484 to $320,167. Excluding the 65 manufactured homes in that Washington County total puts its average for the 219 single-family houses at $375,341.
While Kingsport traditionally has lower home prices than Johnson City and Washington County, the picture in the new home market appears to be changing.
Kingsport’s average new home permit value of $226,321 at this point in 2022 was 21% lower than Johnson City’s average. Through September of this year, however, Kingsport’s average of $318,970 is just 5% lower than Johnson City’s.
The median value in Kingsport — the point where half the permits were higher value and half lower — is $286,902 this year. Last year’s Kingsport median was $207,774.