After the Federal Reserve announced it had raised interest rates by 75 basis points in June, mortgage interest rates jumped to 5.85% for a fixed-rate, 30-year loan, even though mortgage rates are tied to 10-year Treasury Bills, not the Federal Reserve.
Two weeks ago, NextAdvisor ran the headline “Mortgage Rates Had Biggest Drop since 2008” as rates dropped from 5.85% to 5.55% for a 30-year loan. Last week, rates continued their descent and fell to 5.19% for the 30-year fixed products.
Even with the two weeks of decreases, the rates remain a far cry from the 3.875% to 4.25% rates to which buyers had become accustomed.
Last week, the Greater Nashville Realtors announced sales had dropped from 4,649 in June 2021 to 4,257 in 2022.
As real estate sales are somewhat cyclical, comparing year-to-year market data is relevant, more so before 2020 than in the recent past. With all the hubbub concerning interest rates, the recent past might have more relevance.
A look at the last three months reveals sales in the Greater Nashville Area hit 3,818 closings in April, rose to 3,982 in May and hit 4,257 in June. While sales were on rise, inventory began to show significant – and much needed – improvement, as well.
At the end of April, there were 4,314 properties on the market. That jumped to 5,836 in May and to 7,370 by the end of June. The June numbers did reflect a drop in the median price of a single-family home from $498,725 to $495,000.
“Prices remain strong for sellers, while buyers have more time to find the right property and may be able to negotiate for more item like property repairs and closing costs,” says Steve Jolly, president of the Greater Nashville Realtors.
Pending sales, a category that would show the effects of rate increases, were reported at 3,282 for April and 3,381 for May. They fell slightly to 3,245 for June.
Average number of days on the market also remained consistent at 26 for April, 25 for May and 24 for June.
More properties are coming onto the market. Those that are priced well are selling briskly, while those testing the buyers with inflated prices are lingering.
Sale of the Week
Last week, we featured the property at 5836 Hillsboro Road, which sold for $10.633 million, one of two sales for $10 million-plus in the past 12 months. Thanks to last week’s sale of 530 Jackson Boulevard for $11.35 million, it is one of two sales of $10 million-plus in the past two weeks.
The 22,000-square-foot Belle Meade mansion at 530 Jackson Boulevard had been on the market for 471 days at $12.9 million before closing for $1.55 million less.
530 Jackson Blvd
The dynamic listing team of Lisa Fernandez-Wilson and Laura Stroud describe the home as a “Greek Antebellum Revival home of old Carolina brick and adorned with two-story colonnade, custom ironwork and limestone balustrades.”
The house, with its six bedrooms, eight bathrooms and five half bathrooms, was constructed on 5.15 acres in the middle of Belle Meade. The grand foyer features a three-story elliptical staircase, and most of the house had 13-foot ceilings.
The one room that does not have 13-foot ceilings is the gallery, which has 25-foot ceilings over five sets of French doors, three 20-foot arched windows all resting upon grid-patterned marble floors as opposed to the chevron-patterned hardwood floors that cover most of the rest of the house.
Any $11 million house is going to have a pool, tennis courts, a wine cellar, a spa and an elevator. A four-car garage stands at the ready.
Stroud and Fernandez-Wilson also noted the fireplaces in both the living room and the dining room replicate those at the White House.
Additionally, the listing agents provided a “pertinent facts” page that noted the same rooms with White House-inspired fireplaces also feature “J.P. Weaver Company hand-laid Petitsin ceilings inspired by European palaces.”
Steve Fridrich, who seems to be involved with every high-end Belle Meade sale, represented the buyer.
If you’re keeping score, the last two weeks have matched the last 12 months in sales of $10 million or more in Nashville. Let’s see what tomorrow brings.
Richard Courtney is a licensed real estate broker with Fridrich and Clark Realty, LLC and can be reached at [email protected].