anyone have real facts regarding home sales and appreciation? (Knoxville: real estate, condos)

[sliverbox]

I've been researching data for Nashville and TN in general for a few months now. One thing that I've noticed is that unlike the closely watched data that streams from the media regarding prices, sales, and trends out here in CA, this data is all over the place for TN. I've read reports that totally contradict themselves: Some mention insane appreciation, as in 17-20% per year. Others say that sales are slowing and appreciation is maybe 3-5%. Yet others make claims that Nashville is totally unaffected by the boom and will continue as if nothing is happening elsewhere.

My understanding was that appreciation is still fairly moderate, as in 3-5% per year, which would match historical norms. I have to really dig for data pertaining to Nashville because DQ news is too slow at updating the Nashville reports. last report was Q4 06, which is way out of date. The crazy differentiation in reporting has me somewhat confused. Even the Nashville MLS seems to be at the least extremely erratic.

So... bottom line: I'm looking at home priced between 125-200k MAX, with the possible projection of a move in 1.5 years or so. I know there are many industry people on this site. I would appreciate honest and unbiased opinions regarding what is going on in Nashville and it's housing market and if in 1-2 years do you foresee prices still being available in my projected budget. We have no kids or desire to live in a huge house and can easily live within 30 minutes out. I research what is available myself and it does seem like the supply is still kind of high. Then again, I'm not sure if I trust the MLS that much there. So any insider info would be appreciated.

[blueoktober]

I can tell you this: I moved into a subdivision in Spring Hill last Summer that is what you would call "middle to upper class". The house was in the 300k range. I keep hearing how housing is doing phenomenal there, but in the 6 months I was there not a SINGLE house sold. My street had 4 houses that were occupied and about 50 that were just sitting there. The immediate area? The same thing.

I have no idea where you will buy a house for 125-200k that will appreciate any at all. The good/dedent areas of Nashville have all risen to the 250 - 500k range.

People keep touting the housing being so hot there, but I just didn't see it at all in that range. Now if you're wealthy coming from CA or NJ and want to live in a snooty area then YES housing is doing well. Franklin and Brentwood sales are brisk from what I understand.

[johnrex62]

First off, you are looking at a region with a large diversity in housing options. Naturally there will be extreme variations across the different communities. The only way to get good data is to focus on specific neighborhoods and correlate the MLS and Tax data for that specific neighborhood. You need to get to comparing apples to apples for any valid stats to appear.

Secondly, appreciation is a time based variable that appears only in retrospect. You cannot predict appreciation unless you possess supernatural skills in prognostication. You can speculate on what will occur, but there is no basis for prediction of appreciation since it will occur based on factors that do not yet exist.

Good luck on predicting something as volatile as the housing market more than a year out. I predict you will find that only the most conservative and staid market conditions will remain constant enough to ballpark at that range, and that those areas are probably desirable enough that you have already eliminated them due to price constraints. Let me know if I came close.

[sliverbox]

Good answers. Thanks for the insite. Yes, I realize that there is no way to predict appreciation. I recall David Lerah- the now former NAR chief stating that prices where I live now would go up 9% only to watch as they actually came down 2-3%.

Basically, Franklin and Brentwood have been off my list for awhile. I see homes under 200k their on occasion. We're not really interested in living in a super suburban place anyway. We are perfectly happy in the sticks. I grew up that way anyway. We're also not afraid of work. A home in need of repairs is A-ok with us. Smaller 2 bedroom homes are fine as well. We don't care about schools, pristine white picket fences and other seemingly perfection because for one, we don't have kids.

I'm aware of 'desireable' areas being more expensive. That was the same in Knoxville. It is the same out here too. So for now I am looking outwards and in areas not exactly developed.

I realize that Nashville is smaller, but for some reason I've noticed that the variety, supply, and prices seem to be much better in Raleigh/Durahm. I find that remarkable because Raleigh has been touted as the best place in the world and by reading their forum, you'd think half of NY is moving down tomorrow. What I see in Nashville has me just a tad concerned because what you get for 150k seems to be just ok... nothing terrific while the same amount in Raleigh is seems to get you more. I've never been there though so perhaps there is a reason why. I grew up going to Nashville all the time, so I am partially familiar with it and the surroundings.

I guess what I'm getting at is that I witnessed first hand what happened out here in CA. I can't begin to tell you how much it sucks to realize that even though you make a good salary, you cannot afford anything period. Perhaps that has me sometimes worrying is the same fiasco could somehow unfold in Nashville too, and from there- little rock, Des Moines, and Witchita until the whole country is basically one big carbon copy off the UK and nobody can afford.How much would it suck to be priced out of TWO places, and to make matters worse- be priced out of your own damned home state?

Yes- I know that sounds stupid. My gut feeling says Nashville will probably be not terribly different in 1-2 years. Heck, it might even be a hair cheaper. Basically,I'm cool with 3-5% appreciation. If we're talking crazy 10-15% per year, well then it doesn't take long before things to get out of control. Thanks for listening to me fret!

[TNNative]

Originally Posted by sliverbox

Good answers. Thanks for the insite. Yes, I realize that there is no way to predict appreciation. I recall David Lerah- the now former NAR chief stating that prices where I live now would go up 9% only to watch as they actually came down 2-3%.

Basically, Franklin and Brentwood have been off my list for awhile. I see homes under 200k their on occasion. We're not really interested in living in a super suburban place anyway. We are perfectly happy in the sticks. I grew up that way anyway. We're also not afraid of work. A home in need of repairs is A-ok with us. Smaller 2 bedroom homes are fine as well. We don't care about schools, pristine white picket fences and other seemingly perfection because for one, we don't have kids.

I'm aware of 'desireable' areas being more expensive. That was the same in Knoxville. It is the same out here too. So for now I am looking outwards and in areas not exactly developed.

I realize that Nashville is smaller, but for some reason I've noticed that the variety, supply, and prices seem to be much better in Raleigh/Durahm. I find that remarkable because Raleigh has been touted as the best place in the world and by reading their forum, you'd think half of NY is moving down tomorrow. What I see in Nashville has me just a tad concerned because what you get for 150k seems to be just ok... nothing terrific while the same amount in Raleigh is seems to get you more. I've never been there though so perhaps there is a reason why. I grew up going to Nashville all the time, so I am partially familiar with it and the surroundings.

I guess what I'm getting at is that I witnessed first hand what happened out here in CA. I can't begin to tell you how much it sucks to realize that even though you make a good salary, you cannot afford anything period. Perhaps that has me sometimes worrying is the same fiasco could somehow unfold in Nashville too, and from there- little rock, Des Moines, and Witchita until the whole country is basically one big carbon copy off the UK and nobody can afford.How much would it suck to be priced out of TWO places, and to make matters worse- be priced out of your own damned home state?

Yes- I know that sounds stupid. My gut feeling says Nashville will probably be not terribly different in 1-2 years. Heck, it might even be a hair cheaper. Basically,I'm cool with 3-5% appreciation. If we're talking crazy 10-15% per year, well then it doesn't take long before things to get out of control. Thanks for listening to me fret!

It's further than 30 minutes but if you're looking for an area that is not highly populated yet, you might want to look at Orlinda, Cross Plains, or Portland. There are probably houses in your price range there.

[CaliCouple]

Hi Silver...My wife and I find ourselves in a similar situation as yourself (CA tp TN), though without your apparent knowledge of real estate! However, we are trying to find a home in a community with a bit of space, yet neighbors not so far. Without having visited, and going on research and opinion, we are focusing on White House, Cottontown, Pleasant View and Goodlettsville. These are all north of town, 15-30 mi/minutes. Check em out and see what you think.

[kpellatiro]

Originally Posted by sliverbox

I'm looking at home priced between 125-200k MAX, with the possible projection of a move in 1.5 years or so.

I like that you are weary of the headlines. The historic appreciation for Nashville is right where you have it: 3-5%, however you are correct to assume this is a birds eye view. The desirable areas have edged out 10% (averaged over the last few years). These are not limited to Brentwood and Franklin though.

Desirable condos and homes in your price range (and within 30 minutes) have seen twice the average you mention. Rare finds have seen much better. Even in pricey Brentwood there are condos at low end of your price range that have seen near 20% appreciation within the last 12 months. No one knows what tomorrow will bring, but historically you can purchase smart and see the benefit. If you are going to pay a Realtor - make sure they protect your investment. This is a large part of what we are paid to do.

The great thing about Nashville is the proximity to various areas and price points. One and two years from now you could be within 30 minutes of Nashville and still find plenty of housing options for your budget. Rural or developed, home or condo, water, view, urban... literally all of it will be available to you. Just *one* example - Northwest of Nashville is still largely undeveloped. Not an hour away, but 20 minutes out of downtown along I40 or I24. Robertson County (North/Northwest). Literally some of the most beautiful land in Middle Tennessee, and still offering homes well within your desired price range. Again, one area of MANY.

Having moved from San Diego, I know something about crazy spikes and hard corrections in housing prices. You do not have to buy all you can afford here in Nashville (or fear being priced out of the market for the foreseeable future if you want a change). You have too many options to be stuck.

It is a blast to realize the quality of community, and the quality of life here in comparison to larger markets. My guess is you’ll love what all is available to you here in Nashville over the next year and a half.

Kindest regards,

Kevin Pellatiro
(615)714-7918
Keller Williams Realty
kevin@condurelisgroup.com

Your Home. Your Investment. My Job.

[sliverbox]

Hi Kevin and others,
thanks for the insite. I think perhaps the best thing for me to do for now is to simply not worry about it until we get closer to making that decision. Nashville isn't the only place we are possibly considering and we aren't even 100% sure if we're even going to move. Who knows? perhaps prices will finally come down in CA enough to make it worth staying.They are coming down a bit, but in order to be acceptable they need to come down over 40%, and I doubt that will happen.

I also have to remind myself continually that I forget what it was like back home until I come and visit my family there. The population density is literally 1/10th that of CA. Every time I visit, it always surprises me that you can be in a major city like Nashville and be in a fairly rural area within 15-20 minutes. That is the stark opposite of what the situation is where I live now where the city goes on for an hour or more and the traffic is unrelenting.In TN, there is simply so much open space to build that I do not see the supply becoming a problem to the point where housing becomes unaffordable. That's a major problem here. That and there are many building and Not In My Backyard political restrictions. ( good ole' liberals)

At this point we are simply saving up as much as we can,living frugally and so on. It was our hope to buy somewhere and not have a mortgage. I guess this might seem a far-fetched idea. But at the very least we'll likely have a small mortgage with very manageable payments that puts less stress on us in regards to our finances and less pressure to maintain rat-race type careers. The luxury to me will be having the ability to live modest lives in a manner we would have never been able to have where we are now. We've been working hard at this now for over 7 years. Hopefully it will pay off.