Memphis Housing Market Prices and Forecast 2025-2026

If you're thinking about buying or selling a home in Memphis, you're probably wondering what's happening with our housing market right now and what the future holds. The current Memphis housing market trends show a slight cooling with home prices dipping a bit, but there's still more inventory than last year, and we can expect a slow but steady recovery in 2025. It's not a wild boom, but it's also not a crash.

Now, let's dive into what the numbers are telling us and what that means for you.

The Current Memphis Housing Market Trends and What to Expect in 2025

When we talk about the housing market, we're really looking at a few key things: how many homes are for sale (that's housing inventory or supply), how much they're selling for (home prices), how fast they're selling (time on market), and what it costs to borrow money (mortgage rates, though we'll touch on that more later).

Home Prices: A Slight Dip

According to Realtor.com, in September, the median listing price for a home in Memphis was $198,500. Now, that's a little bit lower than it was the month before. What's really interesting is that the price per square foot also went down by 5.8% compared to August. To put that in perspective, nationally, the price per square foot only decreased by 0.8%. So, our market here in the Bluff City saw a bigger dip in that specific area than the rest of the country.

For people thinking about selling, this might sound a little scary, but it's important to remember that this is a pretty normal fluctuation, especially as we move into the fall. It doesn't mean our homes are suddenly worth a lot less.

Housing Inventory: More Homes Available

One of the biggest headaches for buyers over the past few years has been the lack of homes for sale. It's like trying to find a needle in a haystack! But, the good news for Memphis buyers is that the housing inventory is looking better.

In September, there were 2,282 homes for sale in Memphis. That's 2.3% more than the month before and a significant 21.7% increase compared to this time last year. This increase in housing supply is a welcome change for those looking to buy, as it means more choices and potentially a little less competition. Nationally, active inventory also grew, but our increase in Memphis was quite a bit larger.

Time on Market: Homes Taking a Little Longer to Sell

When homes fly off the market in just a few days, it tells you it's a red-hot Seller's Housing Market. When they sit for longer, it can signal a shift. In September, homes in Memphis took an average of 66 days to sell. This is a bit longer than the previous month and a little longer than last year at the same time. Nationally, homes were selling a bit faster, averaging 62 days on the market.

This longer time on market suggests that while there are more homes available, buyers might be taking their time, perhaps due to economic uncertainty or higher mortgage rates. It could be that we're moving towards a more balanced market, where neither buyers nor sellers have a huge advantage.

What Does This Mean for You?

• For Buyers: The good news is you have more options and a bit more breathing room. Prices have softened slightly, and with more homes available, you might find a place that truly fits your needs without having to enter a bidding war. However, don't wait too long – interest rates are still a factor, and while things have cooled, a good deal can still disappear quickly.
• For Sellers: While prices aren't soaring like they were, the increased housing inventory means you need to be strategic. Pricing your home correctly and making sure it shows well are more important than ever. The days of just listing a fixer-upper and getting multiple offers are probably behind us for now. It's still a decent market, but you need to be prepared for your home to take a bit longer to sell.

Memphis Housing Market Forecast 2025 and 2026

Looking ahead is always the trickiest part, but by examining the data and expert opinions, we can get a pretty good idea of what's coming down the pike for the Memphis housing market.

A Look at the Next Year: Stability and Slow Growth

When we talk about the Memphis housing market forecast, we're looking at predictions for home values, sale prices, and how the market might perform compared to other areas. Zillow's data gives us some interesting insights.

As of late August 2025, the median sale price in Memphis is predicted to be around $247,261. By the end of September 2025, the median list price is projected to be $299,933. It's important to note that listing price is what sellers hope to get, while sale price is what buyers actually pay.

Now, let's get a bit more specific with Zillow's MSA (Metropolitan Statistical Area) Forecast:

Timeframe	Memphis, TN Home Value Change
October 2025	0%
December 2025	0%
September 2026	0.9%

What this table tells me is that for the rest of 2025, the forecast is for pretty much flat home values in Memphis. This means we're not expecting a big jump up or a significant drop. It’s a period of stability. However, looking out to September 2026, there's a slight projected increase of 0.9%. This suggests a slow but positive recovery is on the horizon.

Memphis vs. The Rest of Tennessee

It's always helpful to see how our local market stacks up against other cities in our state. Here's a comparison based on Zillow's forecast for September 2026:

City	September 2026 Home Value Change
Memphis, TN	0.9%
Nashville, TN	2.1%
Knoxville, TN	5%
Chattanooga, TN	2.6%
Clarksville, TN	2.9%
Kingsport, TN	3.6%
Johnson City, TN	3.5%
Jackson, TN	1.5%
Hagerstown, MD	2.9% (for comparison)

Looking at this, Memphis is predicted to see the slowest home value growth among the major Tennessee cities in this timeframe. Cities like Knoxville and Kingsport are expected to see much stronger appreciation. This doesn't mean Memphis is a bad market; it just highlights that different regions have different economic drivers and housing demands. Jackson, TN, is also predicted to grow slower than Memphis.

The National Picture: A Gradual Rebound

The National Association of Realtors (NAR) and Zillow also have predictions for the U.S. housing market, and they offer a broader context for what might happen in Memphis.

Key Predictions from Zillow:

• Home Value Growth: After a flat 2025, Zillow expects home values nationally to start recovering in 2026, potentially reaching a peak of nearly 1.9% annual growth by August 2026.
• Home Sales: The forecast is for home sales to end 2025 at around 4.07 million, which is slightly more than in 2024. This indicates more transactions happening.
• Rents: Rent growth is expected to continue cooling down.

Key Predictions from NAR Chief Economist Lawrence Yun:

Lawrence Yun, a respected voice in real estate, is quite optimistic about the U.S. market. He believes “brighter days may be on the horizon.”

• Existing Home Sales: Expected to rise 6% in 2025 and accelerate by 11% in 2026. This is a significant jump, showing confidence in the market's ability to bounce back.
• New Home Sales: Projected to climb by 10% in 2025 and an additional 5% in 2026.
• Median Home Prices: Forecasted to continue increasing at a more sustainable pace, with a projected rise of 3% in 2025 and 4% in 2026. This is a healthy, steady appreciation.
• Mortgage Rates: These are a huge factor! Yun expects them to average 6.4% in the second half of 2025 and dip further to 6.1% in 2026. He calls them a “magic bullet” because lower rates make homes more affordable for buyers.

So, Will Home Prices Drop in Memphis? Can It Crash?

Based on the current trends and forecasts, a major crash in the Memphis housing market doesn't seem likely. The data points towards a stabilization period followed by slow, modest growth.

• Home Prices: The predictions are for flat to slightly positive growth, not a sharp decline. The days of rapid, unsustainable price increases are likely over for now, but that's a good thing for long-term stability. The slight dip we saw in September is more of a correction than a collapse.
• Buyer's vs. Seller's Market: We're likely in a more balanced market right now. There are more homes for sale, giving buyers more power, but the overall demand is still present. It's not a full-blown Seller's Housing Market where you have to offer above asking with no contingencies, nor is it a severe Buyer's Housing Market where sellers are desperate.
• Factors to Watch:
  • Mortgage Rates: If rates drop significantly as predicted, it could boost demand and help prices rise more steadily.
  • Job Market: Memphis's job growth is crucial. A strong local economy will always support a healthy housing market.
  • New Construction: While not a huge factor in the immediate short-term trends, the pace of new home building can impact long-term supply and demand.

A Look Further Out: Early 2027

Predicting this far out is more of an educated guess, but based on the momentum from the 2025-2026 forecasts, I'd expect the Memphis housing market to continue its path of modest growth into early 2027.

• Home Values: I anticipate seeing that 0.9% to perhaps 1.5% growth we see predicted for late 2026 continue into early 2027. It won't be a boom, but it will be steady appreciation.
• Home Sales: With potentially lower mortgage rates and a recovering national economy, home sales volume should remain steady or see a slight increase.
• Housing Inventory: I don't see a dramatic drop in housing inventory unless something unexpected happens. The current increase is likely to level off, providing a consistent supply for buyers.

In my professional opinion, the Memphis housing market is in a healthy transition phase. It's moving away from the frenzy of recent years and settling into a more sustainable rhythm. For anyone looking to buy, this is an excellent time to explore your options and potentially find a great home at a more reasonable price than a year or two ago. For sellers, patience and smart pricing are key, but there are definitely buyers out there ready to make a move.