1031 Exchange in Johnson City Tennessee MSA
The Johnson City MSA offers strong 1031 exchange opportunities with solid cap rates, stable rental demand driven by healthcare and university employment, and competitive property taxes in Tennessee's Appalachian region.
Population
208,537
Key Industries
Healthcare (Ballad Health), Education (ETSU), Manufacturing
Table of Contents
Information is for educational purposes only. Consult qualified professionals for specific advice.
Local Tax Considerations
Property taxes, transfer taxes, and local incentives
Property Tax Rates
Average Rate
0.95% - 1.05%
Assessment Method
Assessed Value (Tennessee Property Tax Code)
MSA rate (0.97%) vs State average (0.58%)
+67% above state average
Transfer Taxes & Fees
Transfer Tax Rate
0.37% state transfer tax
Tennessee real estate transfer tax of 0.37% plus local recording fees and title insurance costs
Local Tax Incentives
Tennessee Economic Development Incentives
Various state incentives for business development and job creation
Eligibility: Qualifying commercial and industrial developments
Johnson City Economic Development
Local incentives for business expansion and retention
Eligibility: Companies creating jobs and investing in the area
Opportunity Zones
Number of Zones
2
Key Locations
- Downtown Johnson City
- East Johnson City
Opportunity Zones offer significant tax benefits for long-term investments, including deferral and potential elimination of capital gains taxes.
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Market Profile Dashboard
Economic indicators and market trends
Population
208,537
Growth: +3.8% annually
Median Income
$55,429
Unemployment
2.6%
Job Growth
+2.8% annually
Economic Drivers
Market Trends
Median Home Price
$320,000 - $370,000
Average Rent
$1,185/mo
Cap Rates
7.0% - 9.0%
Demographics
Median Age
35.1 years
Bachelor's Degree+
42.5%
Owner Occupied
58.2%
Property Type Analysis
Investment opportunities by asset class
Multifamily
Strong demand driven by ETSU students, healthcare workers, and young professionals with stable institutional employment base.
Market Metrics
- Cap Rates: 8.2%
- Vacancy Trends: Low vacancy at 6.5% due to university and healthcare employment
- Demand Forecast: Stable demand from ETSU growth and Ballad Health expansion
Risk Factors
- Dependence on university enrollment trends
- Seasonal rental patterns with academic calendar
Opportunities
- ETSU 15,000 students and growing enrollment
- Ballad Health system employment stability
Single-Family Rental
Popular with faculty, healthcare professionals, and families seeking quality housing in university town.
Market Metrics
- Cap Rates: 8.8%
- Vacancy Trends: Very low vacancy at 4.8% with excellent tenant retention
- Demand Forecast: Strong fundamentals with university and healthcare employment base
Risk Factors
- Academic calendar affecting some rental patterns
- Competition from student-focused housing
Opportunities
- High-income tenant base (faculty, healthcare)
- Strong appreciation potential (+10-15%)
Neighborhood Spotlights
Up-and-coming areas and investment hotspots
Downtown Johnson City
Historic downtown core with university proximity and ongoing revitalization
Investment Thesis
Opportunity zone benefits, ETSU student and faculty housing demand, and potential for appreciation as downtown continues to develop.
Median Price
$267,500
Price Growth
+12.8% YoY
Rental Yield
8.8%
Days on Market
32 days
Key Highlights
Development Pipeline
Downtown revitalization and mixed-use student housing projects
University Area
Residential area surrounding ETSU campus with student and faculty housing
Investment Thesis
Strong student housing demand, faculty rental market, and stable university employment base.
Median Price
$285,000
Price Growth
+8.5% YoY
Rental Yield
8.2%
Days on Market
28 days
Key Highlights
Development Pipeline
Student housing and faculty residential development
Medical District
Area surrounding Ballad Health facilities with healthcare worker housing
Investment Thesis
Healthcare worker housing demand, Ballad Health employment stability, and medical facility expansion.
Median Price
$345,000
Price Growth
+11.2% YoY
Rental Yield
7.5%
Days on Market
25 days
Key Highlights
Development Pipeline
Healthcare facility expansion and professional housing
West Johnson City
Growing suburban area with family amenities and newer development
Investment Thesis
Family rental market, newer housing stock, and appeal to healthcare and university professionals.
Median Price
$385,000
Price Growth
+9.8% YoY
Rental Yield
7.2%
Days on Market
30 days
Key Highlights
Development Pipeline
Suburban residential and commercial development
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Frequently Asked Questions
Common questions about Johnson City Tennessee 1031 exchanges
Johnson City offers strong cap rates (7-9%), stable rental demand from ETSU (15,000 students) and Ballad Health employment, competitive property taxes (0.97% vs. 1.02% national), no state income tax, and exceptional appreciation (+10-15%).
ETSU provides 15,000 students plus faculty/staff creating consistent housing demand, while Ballad Health employs thousands in healthcare (16,864 in sector) offering stable, high-income tenants. Both institutions provide employment stability and growth.
Yes, Johnson City has two designated Opportunity Zones including downtown, offering potential tax benefits for qualifying investments including deferral and possible exclusion of capital gains.
The economy is anchored by Ballad Health (largest employer), East Tennessee State University (2,330 employees, 15,000 students), manufacturing (NN Inc., General Shale), and government employment, providing diversified stability.
Tennessee offers competitive property taxes (0.97% vs. 1.02% national), no state income tax, and business-friendly policies. The healthcare and university presence provides stable employment and consistent housing demand supporting strong returns.