February 2025 Real Estate Market Update: What You Need to Know

February Market Update: Signs of a Spring Awakening in East Tennessee Real Estate

As we transition from winter to spring, the East Tennessee real estate market is showing promising signs of activity. While February was a mixed bag in terms of closed sales, there’s momentum building in pending transactions, new listings, and overall inventory. Let’s dive into the latest market trends and what they mean for buyers and sellers alike.

New Listings: More Choices for Buyers

February saw an increase in new listings compared to both January and the same time last year, offering buyers fresh options they haven’t seen before. This boost in inventory may have contributed to an uptick in contract activity as buyers found homes that met their needs. The luxury market also experienced a rise in new listings priced at $650,000 or more, signaling more high-end options coming to market.

Active Listings: A More Balanced Market?

With just under 8,000 active listings available throughout the month, buyers now have a broader selection to choose from—a shift we’ve been waiting for. Inventory growth like this is essential for a more balanced market, giving buyers breathing room to make informed decisions. The luxury segment saw just under 2,000 active listings, a slight increase from January, indicating steady movement in this category.

Sales Pending: Buyers Are Back in Action

Pending sales saw a notable jump from January to February, mirroring a pattern from last year. What’s driving this shift? Perhaps buyers are getting acclimated to current interest rates, recognizing that prices are likely to rise, or simply enjoying more inventory options. Whatever the case, this increase is a strong indicator of solid closing activity in March. The luxury segment experienced a more modest rise, consistent with typical seasonal trends.

Closed Sales: A February Slowdown

Despite the surge in pending contracts, February marked a multi-year low for closed sales. Even last year, when Snowmageddon threw a wrench in the market, there were more closings than this February. However, with the pending sales increase, we anticipate this number to rebound in the coming months. Luxury sales also dipped slightly but remained within expected seasonal fluctuations.

Months of Supply: More Homes, Longer Wait Times

With a dip in closings and a rise in new listings, the months of supply ticked up to 7.5 months. To put this in perspective, this means that if no additional homes were listed, it would take about 7.5 months to sell through the current inventory. While this number has typically remained flat or even declined between January and February, it’s still a far cry from the over two-year supply seen during the height of the last recession.

Luxury homes currently have a nearly 14-month supply, reflecting the slower pace of high-end sales. However, this is not uncommon—many luxury buyers and sellers time their transactions around the seasonality of breathtaking views, lakefront settings, and lush spring landscapes.

Median Sales Price: Holding Steady with Upward Potential

The median home price remains stable at around $360,000, with market predictions suggesting a potential 5% increase over the course of the year. Luxury homes, on the other hand, saw a price uptick between January and February, a trend we’ll continue to monitor as demand for high-end properties in East Tennessee evolves.

Days on Market: A Seasonal Shift

February’s slower market pace is evident in the average days on market, which now sits at around 65 cumulative days. Typically, this metric peaks in January before declining as the market heats up. For sellers, this is an important time to ensure pricing remains competitive. Agents should be running fresh comps every few weeks to keep listings aligned with the current market. Luxury homes historically take longer to sell due to their unique nature and niche buyer pool, making strategic pricing and marketing essential.

Looking Ahead: Spring Market Momentum

With pending sales rising and new listings hitting the market, the foundation is being set for a more active spring. Buyers appear more confident, and while inventory is growing, demand remains strong. Whether you’re looking to buy or sell, staying informed on market trends will be key to making the most of current opportunities.

Thinking About Buying or Selling? Let’s Talk!

Whether you’re looking for your first home, selling your current one, or simply curious about market trends, I’m here to help you navigate this evolving market.

*Stats provided with permission from the East Tennessee Realtors Multiple Listing Service. As reported by Claudia Stallings, Wallace Real Estate COO.