The US housing market is off to a slow start at the beginning of the spring selling season, as highlighted in our most recent note, "Goldman's Housing Heat Map Shows a Tepid Start to the Selling Season."

Nick Gerli, CEO and founder of real estate analytics firm Reventure Consulting, has highlighted for many months very alarming figures of soaring housing supply in several US housing markets, including Florida and Texas. 

Gerli has now focused on the Tennessee housing market, asking: "Is Tennessee the next market to drop?"

Gerli wrote:

"Inventory is spiking in Tennessee due to a slowdown in buyer demand mixed with a large pipeline of builder inventory. Like most Sun Belt markets, prices in Tennessee skyrocketed during the pandemic (+56%) and locals are now priced out." 

He touched on affordability woes plaguing buyers.

The housing expert believes rising inventory should lead to a "modest correction in the market"... 

Supply in Nashville has topped 2010 levels. 

And Knoxville.

Nashville's housing market was one of those red-hot markets during the Covid era. However, the party ended with interest rate spikes in 2022.

The 30-year mortgage rate still trends around 7%. 

Jeff Checko, the relocation director with The Ashton Real Estate Group of RE/MAX Advantage, recently provided insight into the Nashville housing market to local outlet WKRN, stating that normalization will continue through the spring selling season.

"We saw signs of things returning to a typical seasonal market this year, with interest rates getting back into the sixes and the mid-sixes, and then it was kind of one step forward, one step back, one step forward, one step back again," Checko said, adding, "We're hoping that we get something kind of normal for the first time in about half a decade."

The question for Nashville real estate is whether the soaring housing supply will lead to normalization or a more pronounced downturn, as Gerli asked.