Olive Branch realtor warns mortgage rates and rising costs have cut local purchasing power nearly in half

Tracy Kirkley, a local realtor, told the Olive Branch Board of Aldermen on Nov. 4 that a combination of higher mortgage rates and rising construction costs has substantially reduced local buying power and slowed the housing market.

Kirkley said the average Olive Branch home price rose from $316,000 in 2021 to $379,000 in 2025 while mortgage rates climbed from roughly 2.9% to about 6.6%. "That same home ... their monthly payment is now $2,178," she said, compared with about $1,184 in 2021. "The purchasing power has been cut almost in half in the last five years."

Why it matters: Kirkley said the price-and-rate shift has reduced moves, transactions and new construction—factors that shrink workforce housing options for teachers, first responders and other entry-level buyers who make up much of the city's labor pool.

Key findings from Kirkley's presentation included: the number of home sales in Olive Branch fell from 1,289 in 2021 to about 774 in the latest 12-month window she reported; new-construction sales dropped from 352 to 162; average new-home size declined from roughly 2,760 sq. ft. to about 2,500 sq. ft.; and the average price per square foot for new construction climbed from about $130 to $174. "You can't really build your way out of the affordability crisis," she said.

Kirkley also flagged rising seller concessions: she said 66% of sellers paid some buyer closing costs in the past year, with an average concession of $9,000 and some new-construction cases showing concessions up to $20,000. She told the board that, when combined with price reductions from list-to-sale, sellers often come away about $27,000 below their original expectations.

Board members pressed Kirkley on causes and potential fixes. On whether developers are overpaying for land and passing costs on to buyers, Kirkley said "the scarcity ... of land availability is a part of that" and noted that infrastructure and lot-development costs can make smaller-lot, single-lot building more economical than large-scale development. On whether more apartments would free up single-family homes for sale, she said her experience does not show a simple release effect: some renters prefer single-family homes and investors still target houses.

Kirkley suggested front-end tools—such as covenants or homeowner-association enforcement that protect long-term neighborhood quality—and pointed to down-payment and closing-cost assistance programs as partial mitigants, but she told aldermen there is no single solution. "We're never going back" to 2021 market conditions, she said of the combined interest-rate and price shock.

No formal city action followed the presentation. Aldermen thanked Kirkley for the data and moved on to other agenda items.