Austin Texas got a huge rush for real estate in recent years. This year, it was officially too late according to the guys I watch on YouTube. And it would seem, some fear they also missed the boat in Nashville. Well, it depends on the boat. Cue Mr Miagi, “It is the journey, not the path, Daniel-San.” (That’s a horrible Japanese accent)
Let’s just talk about where Nashville is right now and maybe you can decide for yourself what you can do here.
If you’ve been watching the Nashville market, you know this already, but the heavy buyer traffic the last couple years definitely drove our prices up. If you’ve been watching the news, you’re probably scared you might lose value in your home! So let’s take it back a notch and see where we end up.
In Sep 2019, the median residential home price was $318,000. Sep 2020, $348,000. Sep 2021, $414,853. And finally Sep 2022, last month, we hit $475,000. That’s 9% from ’19 to ’20, 16% from ’20 to ’21, and almost 13% in the last year. That’s a total of 38% increase in the past 3 years, yikes. I mean “yaaayy”??
But wait, let’s put this in perspective for not just the people living in Nashville, but those on the outside looking in… In the US, overall, in Sep 2019 the average price was $327,100, compared to our $318k. Think about the average price point in Los Angeles for a second, you could hardly buy a single family home in LA in 2019 for less than a million. In 2020 in the US, the median price point was $358,700, compared to our $348k. In ’21 it was $423,600, compared to our $414ish… And although FRED hasn’t released even Q3 data, we can look at Q2 for this year… In Nashville in April of this year our median price was $480,000, and nationally it was $440,300. That means we didn’t actually go over the national average price until this year.
So, if you wanted to take advantage of Nashville’s prices before we caught up with the rest of the nation, then yeah, you may have missed the opportunity to get those prices. But, Nashville is still a burgeoning metropolis. And let’s not forget, if you leave the city by 20 mins, you can get some far better deals. In fact depending on the investment type you’re looking for, the better options are going to be outside of metro.
Now we can argue why prices went up. But the reality right now is that Nashville is on trend with the Nation, and the housing market is still one of our most reliable money markets, also it’s a great time to be a buyer right now. The number of mortgage applications continues to drop, so there are far less buyers for both residential and commercial, which means you aren’t going to have the competition you had the last couple years so you can get better prices right now, for sure.
And you know what, since everyone else is talking about rates – I can’t seem to get away from it in any update I do – let me just say this… By comparison, a 6% mortgage rate really isn’t that bad. In the year 2000 you would pay 8-9%, 2010 maybe 5-5.5%, 2011 is when 4% showed up. And we’ve had pretty great rates since then, but in 2018 you could easily have had a 6% rate for a 30 year mortgage. That was before the pandemic.
It’s all about identifying the best deals, and good negotiations. I think Nashville is as good as any place to put your money in real estate. So if you’re looking, don’t strike us from the list just yet. I think we’re going to see some good numbers in the next few years, far better than anywhere that’s any cheaper.