Everything about the actual market situation of Memphis real estate is pivotal for many people. Without a doubt, many things affect the circumstances of the market itself today. According to Roofstock, the market is among the hot ones in the country. It becomes the place where first-time buyers battle with seasoned investors in securing the best deals. At least, that is the most important thing to consider before buying a house there.
Anyone who wants to buy a real estate property in Memphis needs to understand many things beforehand. The matter of Memphis real estate market includes a variety of things. All of them affect the expectations upon purchasing a property there. The changes within the market itself from years ago lead to alterations in other things. Of course, the price of the properties there is just one of those fundamental things. All in all, it takes time to secure a top-notch purchase of property in Memphis.
Memphis at a Glance
Memphis is a city in the United States of America that sits along the famous Mississippi River. The official data from the 2020 US census define it as the second most populous city in the state of Tennessee. That also makes it the 28th largest population in the country. Without a doubt, the population size affects many things. It includes the price of properties in the city. With the continuous increase of the population, it is only reasonable for the housing market there to thrive.
Without a doubt, there are some pros and cons concerning the idea to move and live in Memphis. Regardless of the continually rising home prices, the job market in Memphis is in a top-notch situation at the moment. More importantly, Bloomberg elaborates that Memphis sits first place on the list of the metro areas in the United States in terms of job creation. So, it is a decent place to start a new life with plenty of available jobs.
Furthermore, according to Forbes, Memphis is a top-notch place to start a business. It is that way because the cost of doing business in Memphis is low. Meanwhile, the rising property values and prices may affect the idea to open and run a business in Memphis at the moment.
Memphis Population Growth in Brief
One thing that is close to the matter of the housing market in Memphis is the growth of the population. The two things are correlated to each other, indeed. Regarding that matter, Shelby County is the county with the most population in Tennessee. Memphis sits in Shelby County. That makes it a highly populous city. Nevertheless, the matter of population growth is among the slowest overall. Roofstock describes that the population is declining annually in the city of Memphis.
At the moment, the population of Memphis is 633,104, according to the 2020 US census. Many of the residents sit in the metropolitan area of Memphis. That makes the metro area of Memphis the 42nd largest area nationwide. One of the reasons for the declining population is the cost of living Memphis TN. During the pandemic, many residents moved out from the metro area to the suburbs for more affordable living. This trend may persist for a couple more years to come.
Cost of Living in Memphis
Looking at the living cost in Memphis is one of the things to do before searching for residential property there. The 1% growth rate of employment in the city affects the cost of living, indeed. Thus, it leads to the per capita income in Memphis of $30,423 according to Roofstock. What about the Memphis Tennessee cost of living? Numbeo gives a glimpse of data concerning the necessary spending to live in Memphis. There is detailed information on its website as well.
The estimation from Numbeo leads to the monthly living cost for a family of four in Memphis being $3,000.99. That number comes without any rent in the spending. Meanwhile, anyone who lives alone in Memphis may need about $860.92 without rent. Meanwhile, the data from LivingCost describes that the average cost of living there is $1,634. That makes Memphis among the top 25% of the most expensive cities to live in the world. Yet, the average is 5% lower than the US national average.
LivingCost further elaborates on the crucial things of the quality of life in Memphis. The value is 90 for Memphis which makes it the 21st in the national overall ranking. Furthermore, the amount of monthly salary after tax in Memphis is also among the top ones. It sits at number 203 from 2202 in the US according to Living Cost. The value of that is $4,515. So, it is pivotal to consider those things before searching for a comfortable property in the market of Memphis real estate.
Housing Market in Memphis
Finally, it all comes to the most crucial matter, the housing market itself in Memphis. In short, the real estate market in Memphis is a hot one. There are many reasons for that, indeed. One of the reasons is that Memphis is known as a friendly city for businesses. Believe it or not, it is the home to the first-self-serve grocery store, the first hotel cabin in the world, and the overnight package delivery service invention. So, does that make it a decent place to invest in properties?
At the moment, there is no sign that the market of Memphis real estate is about to slow down. Proceeding with the purchase seriously is one of the most popular pieces of advice for buyers at the moment. The rapidly changing availability of the listings in the market is among the crucial factors that determine the market condition at the moment. That also contributes to the increasing competition between investors and homebuyers. It only makes the market much more tempting, indeed.
Yet, there are many more things that may follow the idea of Memphis invest in the mind. Regardless of the availability of many investment services in the city of Memphis, it is fundamental to understand the circumstance beforehand. Checking the median home sales price as well as the home value index can be beneficial for this. Furthermore, looking at the property rental market is also necessary for the best decision when entering the housing market in Memphis Today.
Up to May 2022, the Zillow Home Value Index for the city of Memphis is $151,770. It experienced a 22.1% increase from 2021. For the last 5 years, the home value experienced a 93.2% increase. Without a doubt, that is a significant thing that affects the pricing of residential properties for families in Memphis. The prolonged short supply of houses in Memphis is among the reasons for those increases. Memphis Investment Properties predict that it will continue.
Other reasons that affect the increasing ZHVI for Memphis are the land development rising costs and qualified workers shortage. Despite the annual increase in employment rate in Memphis at 0.96%, there are not enough qualified construction workers around. It can also be the result of the 1.4% increase in available jobs in Memphis for the last 10 years. Without any significant change on those matters, the situation of Memphis real estate and the housing market will not change.
Another thing to check is the median sales price of residential properties in Memphis. Memphis Area Association of Realtors elaborates that at the moment the value is $221,000. Until May 2022, it experienced an increase of 4.5% from 2021. River Oaks is the most expensive neighborhood in Memphis with its median sales price being $532,000. Meanwhile, Riverside offers the cheapest median sales price in Memphis at $59,000.
In another part of Memphis Tennessee real estate is the market for rental properties. It is the section where investors buy properties and rent them for profit. The low supply of houses for sale boosts the market for rental properties. For the last two years, investors purchased thousands of houses in the city of Memphis and rented them. A report from Realtors indicates that more than 53% of houses in Memphis are filled with renters. So, it is easy to see that buying a property in Memphis is not easy.
The median rent price in Memphis is currently $1,495 for a 3-bedroom house in a month according to Zumper in June 2022. Overall, that value is the result of an 11% increase annually. For the last three years, the total increase of a 3-bedroom home rent price in Memphis has increased by more than 47%. Areas in Memphis with the most expensive rent prices include Harbortown and New Pathways. The price reaches $2,642 and $2,400 in those areas simultaneously.
The Past and the Future
Looking back at the real estate cycle market peak in Memphis in May 2006, the overall home prices in Memphis have decreased by about 11.9%. Yet, the home prices have increased since March 2012 which was the last real estate cycle market bottom in Memphis. Looking at that variety of factors, the Memphis housing market will not slow down. In other words, it will remain difficult to look for a residential house because the supply will remain low at the moment.
More importantly, the low mortgage rates in the US since 2020 also affect the low supply of houses for sale in Memphis TN. Homeowners tend to take advantage of the low rates of mortgages to apply for a mortgage loan. The decreasing financial situation due to the pandemic boosts that matter even further. At the moment, Memphis Investment Properties predicts that in 2022 there will be a lot of mortgage applications since the rates are close to zero.
Memphis Real Estate Market FAQs
What Are the Pros and Cons?
Among the good things about Memphis real estate is the job market. It offers a lot of available jobs for anyone. So far, there is a large employment increase in various sectors there. The sectors include manufacturing, construction, leisure, business services, and hospitality. Nevertheless, the significant disadvantage is the rapidly increasing home prices. Even the rent prices are rising as well regularly.
Is It a Good Place to Invest?
Memphis growth in its many sectors leads to the rising popularity of the city as a place for investment. Without a doubt, there are many areas to invest in in Memphis. The market real estate is one of the best choices. It is easy to understand the shopping spree of many investors concerning the houses in Memphis for the last two years. Therefore, looking for some possibilities of investing some money in the property business in Memphis is a top-notch idea.
How to Buy a House in Memphis?
It is best for a first-time buyer who is looking for a residential house in Memphis to look for Memphis real estate agents. There are many of them in the city that offer their services. Searching for a dwelling to make a direct purchase can be tough, indeed. The battle between homebuyers and investors in Memphis is not a new thing. Therefore, it is better to find the best service from real estate agents in the area.
Buying a house in Memphis can be the dream of some people. Yet, there are many things to consider before doing anything about it. The price of homes in Memphis is among the crucial things to consider. The increase rate and trend are not going to slow down at the moment. Therefore, it is best to prepare for it. The low supply of housing units with a high level of demand makes it much more complicated than ever. Yet, it is a good thing for the city of Memphis in general.
With the increasing number of job openings and household incomes, it remains a top-notch idea to move to Memphis. LivingCost rates Memphis as the 86th best place to live in the world. It is also the most livable city in the state of Tennessee and the 21st best city to live in the US. There is no need to hesitate in searching and purchasing a dwelling within the market of Memphis real estate. Yet, the price of housing units remains affordable for some people.