Nashville boasts exploding population growth, excellent employment opportunities, a robust music and entertainment scene and a growing reputation as a foody destination.
We have all seen market cycles—the peaks, the dips, the flat lines. So what makes a real estate market stand out? Time. How long does it dip? How long does it climb? Does it follow other market trends? Why or why not? The answers to all of these are questions speak directly to why the Greater Nashville, Tennessee, area is THE standout spot for real estate investors.
During the downturn around 2008, Nashville did experience stagnation and even some delinquency. But we got nowhere close to other areas like Phoenix and Las Vegas. While extreme price deflation may be good for investors from the perspective of the “screaming deal,” who is to say that appreciation will rebound to actually qualify that as a screaming deal? If it does, how long will it take? After all, values are relative to time. So while values may be way lower than they were two years ago, it may take five years to get back to the higher level of the past. That does not necessarily equate to wealth. My point here is that stability in a market ALSO makes for good investments, and that’s what Nashville offers over a time continuum.
Now, all that said, Nashville’s current market is red-hot, and prices are appreciating like never before. But, is it sustainable? My answer is yes, to some extent. I believe we will continue to see significant growth, but will have to cool off at some point so we don’t get bubbly. That’s where builders enter the equation, and we are finally seeing more entry-level housing coming to market (and a significant inventory underway as well). This will serve to level the playing field, increase supply overall and give Millennials purchasing opportunities. All of these equate to a healthy, rounded and sustainable real estate market.
So what makes Nashville such a demand market? Well, I have already pointed to low supply and high demand creating the perfect scenario for price appreciation. In fact, we are up over 7 percent in sales volume over last year with median price up over 8 percent (and 2015 was no joke in both categories in and of itself). Price appreciation in 2015 was almost 14 percent over 2014!
Nashville made PricewaterhouseCoopers list of Top 10 cities to Watch in 2016 based on lower cost of doing business and livability. Business Insider has Nashville in the top 13 (not ranked) booming growth cities in the nation, pointing to our massive healthcare and automotive industries. MoveOn touted Nashville’s employment growth since 2010 as a whopping 21 percent with population growth at 10 percent. They also assimilated other journal reports for Nashville including: No. 5 on Forbes’ list of booming cities, No. 3 on Travel + Leisure’s list of Best American Cities as well as America’s Friendliest City for 2016.
With exploding population growth, excellent employment opportunities, a robust music and entertainment scene, along with a growing reputation as a foody destination, it’s not surprising that our real estate market is following the trends in regards to growth, quality and sustainability.