When you think of Nashville, you might picture its iconic country music scene, bustling nightlife, or that hot chicken you can't stop craving. But there's another buzz in town: the real estate market. From soaring house prices to the intriguing strategy of "buy downs," here's what you need to know.
A Peak at the Numbers
According to Justin Floyd, a well-respected guide to Nashville real estate, the housing prices in the Music City have witnessed a significant 7% rise from the previous year. The median sales price now sits comfortably at $599,900, making some homebuyers' jaws drop and others wonder how to navigate this ever-evolving market.
The Buzz About "Buy Downs"
If the rising interest rates have made you break a sweat, here's something to consider: buy downs. In simple terms, a buy down is when a seller gives the buyer a credit to offset some of their mortgage costs. Instead of reducing the home's price, this strategy lowers the monthly payments for the buyer, proving beneficial in a high-interest environment.
For instance, on a $300,000 home, asking the seller for a $10,000 credit to buy down your interest rate could save you a substantial amount each month. As Justin Floyd illustrated, this strategy could save you $248 a month compared to a mere $78 saving if the home price was reduced by the same amount.
Why are Nashville Rents on the Decline?
In a twist, while house prices are skyrocketing, Nashville's rents are witnessing a dip. This decrease is attributed to the highest level of vacancy in 20 years. Developers have been busy, with 12,000 new apartment units built from July 2022 and an additional 37,000 under construction or in the pipeline. With so many options, renters have leverage, and many apartment complexes are now offering perks like free rent to lure them in.
In Conclusion
The Nashville housing market is a rollercoaster of ups and downs, with house prices on the rise and rents surprisingly dipping. If you're eyeing Nashville for your next move or investment, strategies like buy downs might just be your ticket to a smarter investment. And remember, every market fluctuation is an opportunity in disguise.
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