With home prices rising and Realtors reporting something they haven’t seen in years – multiple offers on some of the houses they are selling – Nashville’s housing market showed signs of strength in the first quarter of the year.
The days of the buyer’s market – when it seemed home shoppers could almost name their price – seem to be coming to an end.
“I have been involved in three transactions with multiple offers. That hasn’t happened since ’06 or ’07,” says Frances Garner of Parks Properties.
With buyers competing for properties, sellers are more likely to get their full asking price or at least close to it, she says.
Nashville’s first quarter results confirm her experience. The average price was $184,079, almost $3,000 more than the average price of $181,097 in the first quarter of 2010. Closing prices showed strength even though the number of sales declined by 113 homes to 1,743, according to a market analysis by Chandler Reports.
In Williamson County, the number of sales and the average price were both up. There were 621 sales in the first quarter of this year, 54 more than the first quarter of 2010. The average price of $364,296 was $17,549 higher than last year, Chandler Reports figures show.
Values were weaker in Wilson County, where the average home price declined by $9,290 to $188,340 in the first quarter of 2011. The average price was $197,630 in the first quarter of 2010. The number of sales increased by 60, to 367, in this year’s first quarter, according to Chandler Reports.
Low interest rates are helping attract buyers, says Shawn Meehan, home loan manager with Birchfield Home Mortgage in Nashville. Qualified buyers can get a rate of around 4.875 percent on a 30-year, fixed-rate mortgage. Rates have risen from their all-time low of around 4.25 percent but are still comparatively low.
“That’s a driver for some of the market,” he says.
Last year’s sales numbers were inflated by the $8,000 federal tax credit for first-time buyers and a $6,500 credit for repeat buyers. Those credits expired around the middle of last year, Meehan says.
The market will fully regain its strength only when the unemployment rate comes down and potential buyers feel more secure about their jobs, he says. Tennessee’s unemployment rate was 9.6 percent in February. The Nashville region’s rate was 8.8 percent, according to the latest statistics compiled by the Tennessee Department of Labor.
Angela O’Neil, affiliate broker with the Wilson Group, says the market is particularly strong in West Nashville and the Vanderbilt area. Like Garner, she has had situations where buyers were competing to buy houses.
“I had a closing this month that would have had multiple offers if it had made it to market,” says O’Neil, adding the house sold before she had time to list it.