Tennessee's economy expands at slower, steady pace
What's driving growth
Major projects in advanced energy and next-generation manufacturing are moving forward across Tennessee, contributing to economic activity. Nashville's East Bank redevelopment, including the new Tennessee Titan Stadium, represents a multi-billion-dollar investment. The expansion of Nashville International Airport (BNA) is also driving significant hiring demand in Middle Tennessee.
Housing market right now
Tennessee's housing market is cooling from previous rapid gains, with statewide home price appreciation projected at 3% to 5% in 2026. The median sale price in Tennessee was around $330,367 as of November 2025, with 61.8% of sales occurring under the list price. In East Tennessee, single-family home sales increased 15% year-over-year in December 2025, with prices forecasted to grow 3.1% in 2026.
Migration patterns
Tennessee ranked as the fourth highest state for in-bound movers in 2025, according to U-Haul data, moving up from fifth place in 2024. Cities like Nashville, Johnson City, and Cookeville are noted as growth markets for in-migration. Many new residents are younger adults in their prime working years, which is expected to boost the labor force.
Headwinds
Job growth in Tennessee has slowed, with 24,000 jobs added in 2025, significantly less than the typical 60,000 new jobs per year. Federal policy changes, particularly those related to international trade and tariffs, are contributing to economic uncertainty and impacting some sectors. The state's public infrastructure backlog reached $82.7 billion in February 2026, a $5 billion increase in one year, with over half stemming from transportation and utility projects.
Key facts
- Tennessee's inflation-adjusted gross domestic product is projected to advance by 2% in 2026. (Boyd Center for Business and Economic Research, December 2025)
- The average home value in Tennessee was approximately $330,598 as of November 2025, representing a slight dip of 0.3% over the past year. (Tennessee Housing Market: Statistics and Forecast, November 2025)
- Tennessee added an estimated 24,000 jobs in 2025, a 0.7% increase, with a projected 31,400 jobs in 2026. (Boyd Center for Business and Economic Research, December 2025)
- Tennessee ranked as the fourth highest state for in-bound movers in 2025. (U-Haul, January 2026)
- The state's annual budget for 2025-2026 included an unprecedented $80 million in recurring and an additional $1 billion in non-recurring dollars for transportation infrastructure. (Tennessee Department of Transportation, 2025)