First big decision: We’re moving to Nashville!
Second, equally complex decision: We’re buying a home in Nashville! Or maybe renting? Or maybe Airbnb-ing until we recover from decision paralysis one way or the other?
Becoming a homeowner is a major undertaking, particularly when you’re moving to a brand new city. We’ve met and worked with countless new Nashvillians who’ve really struggled with the decision of whether to take the plunge and buy a home in Nashville, or wait a while and rent a place. And although helping people buy homes in Nashville is our job, we’ll be the first ones to say: It’s not for everyone, or every circumstance.
Whether or not it’s the right time to buy a home here depends on a mix of factors — personal, professional, financial, emotional — and weighing out the pros and cons is a heavy process, often fraught with uncertainty.
We can’t give a potential homebuyer their answer. You need to consider how long you think you’ll stay in Nashville, how long you might like to stay in the same home, how your credit’s looking, whether you have the finances for a down payment and potential repairs… Then there’s just life stuff. Do you have or want a dog? Do you think you might have children soon?
What we can help with, at least, is a little bit of Nashville real estate market information that might help make the weighing-out easier. Or at least more informed.
A few key points that’ll likely play a role in your decision:
Home values are still going up in Nashville
This isn’t news to you if you’ve even considered buying a home in Nashville, but: Over the last few years, housing prices here have been on a steady, often head-spinningly rapid rise. In some Nashville communities, like super-hot Germantown, home values have risen as much as 27.7 percent in a single year. The rise has covered just about every corner of the city, and although it’s becoming a little less head-spinning, it’s still going strong. Let’s just look at 2018: In January, the median residential home price in Nashville was $281,500; in August, it was $305,000. No one can predict the real-estate future, but the chances of appreciation in Nashville continue to be good — a definite positive for homeowners.
Home inventory is on the upswing in Nashville
This is true of many U.S. cities, but for the past handful of years, Nashville has been struggling with housing inventory, and with more buyers than available homes, prices continued to shoot up and home sales went through at a rocket-powered pace. We’re finally getting to a point where inventory is making a significant jump — total property inventory in Nashville around this time last year was just over 9,000, and in August of 2018, it was over 12,000. That’s good news for buyers — it’ll mean more options, and less of a frenzied buying experience.
Mortgage rates are still favorable
Sure, in recent years, the average mortgage rate has crept up a little. But we’re still at a great spot in terms of mortgage rate trends. Go back a decade, and we were looking at an average rate of 6.03 percent. In 2018, we’re still seeing rates closer to 4.38 percent. Even if we did creep as low as 3.65 percent not too long ago, these are still appealing numbers.
Tennessee has a program that can help with your down payment
If you’re particularly worried that a down payment and closing costs might take you out of the homebuyer running, Tennessee has a program that could change your picture. The Tennessee Housing Development Agency’s Great Choice Loan Program, designed to help first-time homebuyers, can offer as much as $15,000 in downpayment assistance to qualifying buyers. The HHF-DPA program can be a particularly big help for buyers looking in participating zip codes (including parts of Southeast Nashville, North Nashville and Madison). Learn more about the Great Choice Loan Program at THDA.org.
Rent is finally starting to come down in Nashville
All that said, if you don’t feel like you’re totally ready to buy a home in Nashville, there’s some relief for renters, too. The bump in inventory here extended to rentals, and so we’re finally starting to see skyrocketing rent prices in Nashville retract some. The Tennessean reported recently that July showed the first rent drops in Nashville in nearly seven years, from a median of $1,494 in July, 2017, to $1,490 in 2018. Sure, that’s not a major bump down, but it’s at least an indication that you don’t necessarily have to rush to get ahead of wild rises in rent.
If you need any more help weighing out whether buying a home in Nashville is a good fit right now, we’d be glad to share more info, and any other professional insight you might want or need. Just reach out to ACRE here.
In the meantime, if you’d like to get a look at what your options are, check out some homes for sale in Nashville here.