MURFREESBORO, Tenn. (WMOT) -- Tennessee’s housing market cooled in the first quarter, even while job creation accelerated.
A first quarter analysis by the Business and Economic Research Center at Middle Tennessee State University shows that home construction fell by just over four percent compared to the final quarter of 2012. Home sales stalled and foreclosures are on the rise again.
MTSU Economist David Penn says Tennessee is starting to feel the impact of payroll tax increases and federal sequestration budget cuts. In spite of the downturn, he says 2013 is still off to a better start than recent years.
“Certainly better than a year ago, but not as good as the fourth quarter (of 2012). Part of what’s going on here is that the fourth quarter was very, very positive, so part of this is a rebound back to the mean.”
Penn says that when you look at the numbers year-over-year, new home construction looks much better, with building starts jumping by just over 23 percent compared to 2012.
The report also notes that the rate at which Tennessee created jobs accelerated in the first quarter, while initial unemployment claims fell.