The residential real estate market in Memphis is attractive and nearly one-quarter of Shelby County home sales in 2021 were in the suburbs.
As a whole, the area saw modest gains, according to data from the Memphis Area Association of Realtors. The county reported 19,890 homes sold, a 13.1% increase from the previous year. Prices also continued to increase. The average sales prices were about 11.5% higher in 2021 than those of homes that sold in 2020.
Of Shelby County’s suburbs, only Germantown showed a decrease in home sales in 2021 compared to 2020. Collierville’s increase was only slightly higher than the previous year. The rest of the suburbs, showed noticeable increases in sales despite some hindrances with getting materials for new construction and the rising cost of those materials.
“Supply chain has put a damper on a lot of new construction,” said Carmen Prince, president-elect of Memphis Area Association of Realtors.
Of the homes that sold in Shelby County, 596 were new.
“It’s a seller’s market,” Prince added, noting inventory is low. “But there are a lot of buyers out there because of the (low) interest rates.”
She said in her experience many people are upsizing and want proximity to their work or children’s extracurricular activities.
Bartlett saw strong home sales in 2021 with about 1,346 homes sold, the most of any of the suburbs. That number is an increase of about 16.5% compared to 2020.
“The price range is probably more attractive to a larger audience,” said John Threadgill, Bartlett Chamber of Commerce president.
In Bartlett, homes prices increased about 15%. The average home sale was about $279,000. Hardly any of those are new homes — only eight to be exact — which is half of what the suburb saw in 2020.
In Collierville, the suburb saw about a 0.2% increase in home sales, although 1,113 existing homes sold — a 1.8% drop compared to 2020. However, Collierville again saw strong sales among new homes. In 2021, 177 homes sold — an increase of 14.2% from 2020. The new-home prices also rose about 9% on average.
Jamie Groce, Collierville town planner, said there doesn’t seem to be only one place developers are building new homes. Instead, it’s all over the suburb. In 2021, Collierville had the most new building permits since 2006, prior to the recession and market fall of 2008. A significant amount of land remains vacant in Collierville for homebuilders to pursue development. In future years, Groce said he expects more development on the south side of town near Collierville High.
Arlington saw the strongest home sales overall compared to the year prior with an increase of 24%. Existing home sales made up for 76% of the 517 home sales. The average sales price was nearly $370,000, an increase of almost 15%.
Arlington Mayor Mike Wissman believes people are moving to Arlington for the same reasons people have the last few years.
“Its seems to be amplified because the inventory is so low,” he said. “It’s the schools, a safe community, low taxes and the amenities of a small town even though we are growing. A suburb on the outskirts of a big city — it’s attractive.”
Arlington’s challenge will be monitoring its potential growth with the proximity to the Megasite of West Tennessee and Blue Oval City due to the suburb’s location between U.S. 70 and Interstate 40. Wissman said the town wants to have quality development. The town currently has a moratorium on hotels and gas stations.
“You can either set your standards and make people live to your standard, or you’re not prepared for it,” he said.
Currently the town wrestles with what the needs are as well as what amenities to add noting “you don’t want to grow just to grow.”
Germantown saw a 6.4% decrease in the number of home sales compared to 2020. In 2020, it saw strong gains compared to the year prior. More than 20% of Germantown’s population is 65 and older and baby boomers are not downsizing like they used to.
Prince said in her own experience she notices people upsizing.
However, prices in Germantown rose about 8%. The average sale price of a Germantown home was $475,00, and only five of those were new homes. Germantown has significant new residential developments on the horizon with projects like John Duke’s Wilder at Forest Hill, north of Forest Hill Elementary School. Glasgow, the residential development for the former Germantown Country Club, is also moving through the suburb’s review process.
Lakeland had 358 homes sell, nearly a 7% increase from the year prior. Of those homes, 304 were existing, and those prices rose from about $341,000 to more than $375,000 — an increase of almost 10%.
“We don’t want to be the biggest municipality in our area, we want to remain known for high-quality residential development,” Shane Horn, Lakeland city manager said.
While all the suburbs pride themselves on their school system, Lakeland will open its high school in August making the suburban district a K-12 system.
Horn said Lakeland is also working to provide more amenities for residents from investing in its parks to providing more retail and dining options for residents with developments like The Lake District and Lakeland Commons.
He said the city is also working on a comprehensive plan that will set vision and goals for the future of Lakeland.
Millington continues to grow. About 301 homes sold in 2021, compared to 221 in 2020. In 2021, 16 new homes sold, compared to eight a year earlier. The average price of homes that sold rose about 10% to $181,918.
Prince said experts expect similar trends in 2022 as seen in 2021. Interest rates may inch up but are not expected to do so drastically.
She said the inventory is still expected to be low though so prices will remain high. While sellers may get more for a house, they likely will also pay more when buying.