Are you thinking about buying or selling a home in Memphis? Understanding the current Memphis housing market trends is crucial for making informed decisions. Right now, the Memphis housing market is showing some interesting shifts. While home sales have dipped slightly compared to last year, average sales prices are up. Let's dive into the specifics to see what's really going on.
Decoding the Current Memphis Housing Market Trends:
Home Sales
Okay, let's talk numbers. According to the Memphis Area Association of REALTORS® (MAAR), home sales in the Memphis area decreased by 7.0% in January 2025 compared to January 2024. That means 1,161 homes were sold this January, versus 1,249 last year.
Now, don't jump to conclusions just yet! While the year-over-year comparison shows a decline, there's a silver lining. Sales actually increased by 4.8% from December 2024, when 1,108 homes were sold. This could indicate a seasonal bump or a sign that the market is starting to pick up again after the holiday lull.
Here's a quick look at the sales data:
Month | Total Home Sales |
---|---|
January 2025 | 1,161 |
January 2024 | 1,249 |
December 2024 | 1,108 |
Home Prices
Now, let's get to the part everyone's interested in: home prices. Here's the breakdown:
- Average Sales Price: The average sales price in January 2025 was $247,876, a 12.3% increase from January 2024's average of $220,648.
- Median Sales Price: The median sales price also saw a significant jump, reaching $190,000 in January 2025. That's a 13.1% increase from the $168,000 median price in January 2024.
This tells us that while fewer homes might be selling, the ones that are selling are commanding higher prices.
Are Home Prices Dropping?
This is the million-dollar question (or, perhaps, the $247,876 question!). Based on the January 2025 data, home prices are NOT dropping in Memphis. In fact, they're still climbing at a pretty decent pace year-over-year. However, it's important to remember that real estate is hyper-local. Trends can vary widely from neighborhood to neighborhood. This data represents the overall Memphis area. Some neighborhoods may be increasing at faster rates, some at slower rates, and some might even be flat or decreasing. You would need to look at your specific areas of interest.
Comparison with Current National Median Price
Nationally, the median home price in December 2024 was $407,500, with a year-over-year increase of +6%. This means that the Memphis median home price of $190,000 is significantly lower than the national median. Memphis is still a very affordable place to buy when comparing prices across the country.
Here's a side-by-side comparison:
Metric | Memphis (January 2025) | National (December 2024) |
---|---|---|
Median Sales Price | $190,000 | $407,500 |
Year-over-Year Change (Median Price) | +13.1% | +6% |
Housing Supply
Inventory, or the number of homes available for sale, is another key indicator of market health. In January 2025, there were 3,511 units listed for sale, which is a 1.2% increase compared to January 2024.
While a slight increase is good news for buyers, it's important to note that inventory is still relatively low. A balanced market typically has around 6 months of supply, meaning it would take 6 months to sell all the homes currently listed if no new homes came on the market. With just over 3,500 listings, the Memphis market is still leaning towards being a seller's market (more on that below).
Looking at Active Listings historically:
Month | Active Listings |
---|---|
February 2023 | 2,760 |
February 2024 | 3,072 |
January 2025 | 3,511 |
The data shows inventory trending upwards slowly.
Is It a Buyer's or Seller's Housing Market?
So, is it a good time to buy or sell in Memphis? Right now, the Memphis housing market is leaning toward being a seller's market, but it is not a strong seller's market. This means that there are slightly more buyers than homes available, which gives sellers an advantage.
Homes in Memphis are selling quickly. The January average Days on Market (DOM) was 58 days, which represents a 16 percent increase from the previous month. This means that the average time to sell your property increased. Buyers need to move swiftly when they find a home they like. However, do not rush into making bad decisions.
Market Trends
Beyond the raw numbers, let's look at some broader Memphis housing market trends:
- Suburban and Exurban Growth: I've noticed that areas outside of the immediate city center, like Bartlett, Collierville, and Germantown, are still highly desirable. People seem to be prioritizing larger homes, good schools, and more space.
- Downtown Resurgence: On the flip side, downtown Memphis is experiencing a revitalization, with new condos and apartments attracting younger professionals and empty-nesters.
- Investment Properties: Memphis has always been a popular market for investors, thanks to its relatively low property prices and strong rental demand. I expect this trend to continue, especially in areas undergoing redevelopment.
Impact of High Mortgage Rates
One of the biggest factors influencing the housing market nationwide is mortgage rates. Currently hovering around 7% (as of February 2025), mortgage rates have significantly increased compared to the record lows of the past few years.
This has several impacts:
- Reduced Affordability: Higher rates mean higher monthly payments, making it more difficult for some people to afford a home.
- Slower Sales: As affordability decreases, some potential buyers are priced out of the market, leading to slower sales.
- Price Moderation: While prices are still increasing in Memphis, I believe the pace of appreciation may slow down as higher rates put downward pressure on demand.
Sales Summary across Memphis Areas
Area | Total Units Sold (Jan 2025) | Median Sales Price (Jan 2025) | Average Sales Price (Jan 2025) |
---|---|---|---|
Memphis Area (Total) | 1,161 | $190,000 | $247,876 |
Existing Sales | 1,147 | $190,000 | $247,896 |
Non-Bank Sales | 1,114 | $184,150 | $238,897 |
New Home Sales | 14 | $161,750 | $246,225 |
Bank Sales | 47 | $432,900 | $460,715 |
Arlington | 44 | $247,500 | $259,610 |
Bartlett | 107 | $264,750 | $301,431 |
Collierville | 47 | $549,000 | $610,123 |
Cordova | 58 | $295,000 | $311,888 |
Fayette County | 41 | $415,000 | $453,496 |
Germantown | 20 | $346,750 | $441,930 |
Lakeland | 21 | $495,000 | $490,357 |
Millington | 12 | $186,250 | $208,543 |
Shelby County (Total) | 1,061 | $179,900 | $238,193 |
Tipton County | 56 | $382,450 | $422,115 |
My Take on the Memphis Market
As someone who's been watching the Memphis real estate market for years, here's my perspective:
- Opportunity for Buyers: Even though it's leaning toward a seller's market, there are still opportunities for buyers. The key is to be prepared. Get pre-approved for a mortgage, work with a knowledgeable agent, and be ready to act quickly when you find the right home.
- Strategic Selling: If you're thinking of selling, now is still a good time. Prices are up, and demand is still relatively strong. However, don't overprice your home. Work with your agent to set a realistic price based on current market conditions.
- Long-Term Investment: Real estate is a long-term game. Memphis has a stable economy and a growing population, which makes it a solid market for long-term investment.
Memphis Housing Market Forecast: What to Expect in 2025 (and Beyond!)
You're probably wondering what the future holds for the local real estate market. So, let's cut to the chase: The Memphis housing market forecast indicates steady, but moderate growth throughout 2025. While we're not expecting a massive boom, current projections suggest a continued rise in home values. Keep reading as I dive into the details and share my thoughts on what this means for you.
Okay, before we look ahead, let's quickly touch on where we are right now. As of the end of 2024, the Memphis housing market, like many others across the country, has been navigating a period of fluctuating interest rates and shifting buyer demand. Although I don't have recent numbers on the average home values, it's safe to say that affordability is a key concern for many potential homeowners in the area.
The Forecast: Memphis Housing Market in 2025
Now, let's get into the numbers. According to Zillow's latest MSA Forecast, the Memphis housing market is expected to experience the following growth:
- Next Quarter (Ending March 2025): A projected growth of 1.2%.
- Forecast Until December 2025: An estimated increase of 3.3%.
This indicates that Zillow believes the market will continue to appreciate. While not a meteoric rise, a steady climb of 3.3% is still something, and it definitely beats a decrease in home values!
How Does Memphis Stack Up Against Other Tennessee Cities?
It's always helpful to see how Memphis compares to other major markets in Tennessee. Here's a quick look at Zillow's projections for other metropolitan areas in the state until December 2025:
City | Projected Growth (Until Dec 2025) |
---|---|
Nashville | 3.4% |
Knoxville | 7.0% |
Chattanooga | 4.8% |
Clarksville | 4.7% |
Kingsport | 5.4% |
Johnson City | 6.1% |
Jackson | 4.5% |
Memphis | 3.3% |
As you can see, Memphis is projected to have slower growth compared to Knoxville.
Will Memphis Housing Prices Drop? Will There Be a Crash?
Everyone wants to know if the bubble is going to burst! Based on the data and my understanding of the market, I don't anticipate a housing market crash in Memphis in 2025.
Here's why:
- Steady Growth: The forecast indicates gradual appreciation, not a sudden spike that's likely to correct sharply.
- Strong Economy: The Memphis economy has been showing signs of strength.
- Limited Inventory: Although I don't have specific numbers, most markets have been facing inventory problems. This keeps prices up to some extent.
However, it's also important to remember that real estate is hyper-local. While a national crash is unlikely, specific neighborhoods within Memphis could experience price adjustments based on local factors.
Looking Ahead: A Potential Forecast for 2026
Predicting the market beyond 2025 is tricky, but I believe we'll see a continuation of moderate growth in Memphis. Assuming interest rates stabilize and the local economy remains healthy, a 3-4% annual increase in home values seems realistic. However, keep an eye on economic indicators, job growth in the area, and any changes to interest rate policies, as these can all influence the market.
Final Thoughts
The Memphis housing market appears to be on a path of steady, sustainable growth in 2025. While it may not be the hottest market in Tennessee, it offers stability and potential for long-term investment. Whether you're a buyer or seller, staying informed and working with a knowledgeable real estate professional is key to navigating the market successfully.
Should You Invest in the Memphis Real Estate Market?
The allure of Memphis real estate is undeniable. Over the past decade, home values have skyrocketed, making it a magnet for investors seeking long-term gains. But is Memphis a guaranteed path to riches, or is there more to the story? Let's explore the data and explore the factors that make Memphis a compelling, yet nuanced, investment opportunity.
A Track Record of Impressive Growth
There's no denying the impressive long-term performance of Memphis real estate. Over the last ten years, Memphis has witnessed a staggering 110.69% appreciation in home values, translating to an average annual jump of 7.74%. This puts Memphis in the top 20% of U.S. cities for real estate appreciation – a dream come true for long-term investors who've held onto Memphis properties.
A Market with Staying Power
What makes Memphis's growth even more attractive is its consistency. Even when we zoom in on recent years, the market shows resilience. Over the last five years, Memphis continues to outperform, boasting a significant appreciation rate that surpasses both the Tennessee and national averages. This strong track record suggests a market with underlying fundamentals that support long-term growth, such as:
- Diversified Economy: Memphis is no longer a one-trick pony. While historically reliant on industries like manufacturing and agriculture, the city has seen a surge in healthcare, logistics, and education sectors. This diversification helps insulate the Memphis economy from downturns in any single industry. Here's some recent data to support this:
- The healthcare sector is now the largest employer in Memphis, accounting for over 100,000 jobs.
- Memphis is a major logistics hub, boasting three Class I railroads and the world's busiest cargo airport by volume. FedEx employs over 30,000 people in the Memphis area.
- The University of Memphis and St. Jude Children's Research Hospital are leading institutions that attract talent and investment to the city.
- Infrastructure Improvements: The city is investing heavily in infrastructure upgrades, including transportation networks and public amenities. This not only improves quality of life but also attracts businesses and residents, further fueling real estate growth.
- Favorable Tax Climate: Tennessee boasts some of the most tax-friendly policies in the nation:
- No state income tax: This translates to significant savings for investors, as they don't pay state income tax on rental income or capital gains from property sales.
- Relatively low property taxes: The average effective property tax rate in Tennessee is 0.73%, which is lower than the national average of 1.07%. This translates to lower holding costs for real estate investors.
A Recent Cool-Down: A Cause for Concern?
However, a responsible investor should always acknowledge current market conditions. The latest quarter (Q3 2023 to Q4 2023) did see a slight dip of 1.15% in appreciation. While this isn't a deal-breaker, it underscores the reality that no market is immune to short-term fluctuations. This recent cool-down could be due to:
- Rising Interest Rates: Nationally, rising interest rates have impacted affordability, potentially leading to a slowdown in sales.
- Increased Inventory: A slight increase in available properties could put downward pressure on prices in certain segments.
Memphis: A Market Tailored for Specific Investors
So, should you invest in Memphis real estate? The answer depends on your investment goals and risk tolerance.
Memphis shines for investors seeking:
- Stable Market: With a history of strong appreciation and a diversified economy, Memphis offers relative stability compared to more volatile markets. The city's economic growth is fueled by multiple sectors, making it less susceptible to downturns in any one industry. Additionally, the Memphis real estate market has a proven track record of consistent appreciation over the long term, even experiencing positive growth during the recent national economic slowdown. This stability makes Memphis an attractive option for investors seeking a reliable hedge against inflation and a secure investment for their future.
However, Memphis might not be ideal for:
- Fix-and-Flip Investors: The recent cool-down and time for renovations to show returns may not align with a quick-flip strategy. Investors seeking rapid profits might be better suited for hotter markets.
Beyond the Numbers: Considering the Bigger Picture
Remember, real estate is a local game. While Memphis boasts impressive numbers, it's crucial to go beyond the statistics. Consider factors like:
- Specific Neighborhoods: Memphis has a vibrant and diverse range of neighborhoods, each with its own unique character and investment potential. Research areas that align with your investment goals, whether it's appreciation potential, rental yields, or proximity to amenities.
- Property Types: Single-family homes, multi-unit buildings, and even student housing can offer varying investment opportunities. Consider the type of property that best suits your investment strategy and target market.
- Overall Market Trends: Stay informed about local market trends, such as job growth, population shifts, and new development projects. These factors can significantly impact the future performance of your investment.
Partner with a Turnkey Property Seller in Memphis
While a local realtor offers undeniable value, consider exploring turnkey property sellers for a streamlined investment experience in Memphis.
Turnkey property sellers specialize in identifying, acquiring, renovating, and tenanting investment properties. They handle the entire process, allowing you to invest passively and start earning rental income quickly. Here's how partnering with a turnkey seller can benefit you:
- Reduced Time Commitment: Skip the hassle of property search, renovations, and tenant placement. Turnkey sellers take care of everything, freeing up your time to focus on other endeavors.
- Expert Selection: Turnkey sellers have a proven track record of identifying properties with high rental potential in well-performing Memphis neighborhoods. They leverage their expertise to secure properties with strong appreciation potential.
- Hassle-Free Management: Many turnkey sellers offer ongoing property management services, ensuring your investment runs smoothly. They handle tenant issues, maintenance requests, and rent collection, giving you peace of mind.
Remember, due diligence is key! Regardless of your chosen path, conduct thorough research on both the Memphis market and the specific realtor or turnkey seller you're considering.
Best Memphis Neighborhoods for Buying a House (or Investment)
Thinking about investing in Memphis real estate? Here's a breakdown of the ten neighborhoods boasting the highest appreciation rates since 2000 (Neighborhoodscout). Keep in mind that appreciation is just one piece of the puzzle – consider these descriptions a jumping-off point for further research.
- Harbor Ave / Port St: This riverfront gem offers stunning views and the potential for exciting development projects. With the Mississippi River as its backdrop, this neighborhood could be ideal for those seeking scenic beauty and future growth.
- The Edge / Victorian Village: Steeped in history and boasting a charming aesthetic, The Edge / Victorian Village is a fantastic choice for those who appreciate a classic architectural style. Its close proximity to downtown Memphis adds to the convenience factor.
- North Memphis: A large and diverse area, North Memphis is brimming with potential for revitalization. With a mix of established communities and up-and-coming pockets, this neighborhood offers a variety of investment opportunities.
- Lauderdale Courts / Winchester Park: Once known as a cornerstone of blues music history, Lauderdale Courts / Winchester Park has undergone a revitalization, offering a unique blend of historic architecture and modern amenities. This area is a great option for investors seeking a neighborhood with character.
- Uptown: Known for its trendy shops, restaurants, and walkable streets, Uptown is a magnet for young professionals. With a vibrant atmosphere and a central location, this neighborhood could be a good fit for those targeting a specific renter demographic.
- Cooper Young East: This energetic district is a haven for community spirit. Cooper Young East boasts a variety of shops, restaurants, and green spaces, making it an attractive option for families and young professionals alike.
- North Memphis West: Similar to North Memphis as a whole, North Memphis West is an area on the rise. With potential for appreciation and a growing sense of community, this neighborhood could be a smart choice for investors with an eye for future opportunities.
- Vollintine-Evergreen: This family-friendly neighborhood is a favorite for those who value a peaceful environment. Vollintine-Evergreen is situated near Overton Park and the Memphis Zoo, offering residents easy access to green space and family fun.
- Cooper Young: A perennial favorite, Cooper Young offers a wide range of housing options, from historic bungalows to modern condos. This lively neighborhood is a great choice for investors seeking a mix of young families and professionals as potential renters.
- Midtown: The beating heart of Memphis, Midtown is a dynamic and constantly evolving neighborhood. From art galleries and theaters to trendy bars and local shops, Midtown offers something for everyone. This central location could be ideal for investors seeking a diverse tenant pool.
Appreciation rate is just one factor to consider when investing in real estate. Before making a decision, delve deeper into current property values, rental rates, crime statistics, and school quality in each neighborhood to make a well-informed investment choice.