What Tennessee's Foreclosure Headlines Leave Out

Tennessee ranks 44th in the country for foreclosures. See what that really means for Middle Tennessee homeowners before you make a move.

A headline is making the rounds right now, and it's making Tennessee homeowners nervous: mortgage delinquency here is rising at one of the fastest rates in the country, putting us among the top 20 states for increasing delinquency. That part is true. 

But one increase pulled out of context doesn't tell the whole story, and we don't want anyone falling prey to the kind of fear-mongering that sells advertising in the news.

So let's walk through what you actually need to know.

Tennessee ranks near the bottom of the country for foreclosures. Year over year, Tennessee sits at 44th in the nation for foreclosure activity. Consider what that means: we're the 16th-largest state by population, yet we have the 44th-highest foreclosure rate. That's a genuinely positive sign. It tells you our delinquency levels are very low to begin with. And much of the delinquency isn't even in Middle Tennessee. So even if the state sees a 2% increase, or climbs faster than others in percentage terms, we're starting from such a low baseline that it simply isn't cause for concern right now.

The real numbers put it in perspective. In Tennessee, roughly one in every 8,000 homes is in some stage of mortgage delinquency heading toward foreclosure. That's a perfectly healthy number, and it's not what's driving the housing market shift we've been describing for two years now. In fact, Middle Tennessee's counties are among the strongest in the country on this measure. A recent ATTOM housing-risk report ranked Rutherford County among the lowest-risk counties in the entire nation, and nine Tennessee counties landed among the 50 least risky overall. 

“One little increase doesn’t tell the whole story.”

So what is actually changing? It's not foreclosures. It's the combination of higher interest rates and a larger inventory that creates more uncertainty for buyers. When people have more options and feel they have little time, they're more willing to wait before making a decision. That's just human nature: more choices make decisions harder. So Middle Tennessee is gradually ticking toward a buyer's market after a nice stretch of balanced conditions, and that's a very different thing from a crisis.

What this means if you're thinking about selling. Don't be afraid that the market is going to collapse, because the data doesn't point that way. What we're telling our clients is straightforward: right now is probably a better time to sell than this time next year. If you've decided you'd rather hold your home and turn it into a rental, that can be a great plan. Just go in expecting to keep it for a few years rather than assuming you'll flip it for more money in 12 months. Pricing is holding steady in Davidson County and rising at a normal pace in Williamson County. We're not falling off a cliff.

Don't let a "mortgage delinquency is going through the roof" headline convince you there's a housing crisis, because there isn't one. 

What's really happening varies neighborhood to neighborhood. That's exactly why it pays to get specific about your home rather than react to a statewide statistic. 

If you have questions about what all of this means for your house, reach out. Call or text us at (615) 315-9223, email us at homes@fykesgroup.com, or visit fykesrealtygroup.com.