Aug 14, 2023 - Real Estate

Condos a resilient spot in Nashville's slower housing market

Year-over-year change in median sales price of homes in Nashville
Data: Zillow; Chart: Alice Feng/Axios

Condos remain a hot spot in Nashville's cooling housing market, with prices increasing and sales remaining resilient while other sectors see dips.

Why it matters: Condos' growing appeal comes as younger buyers look for more affordable homes and empty-nesters want to downsize to a maintenance-free lifestyle, Axios' Sami Sparber reports.

Between the lines: Rising interest rates are limiting people's buying power even though single-family home prices are falling slightly.

The big picture: More buyers have turned to condos and townhouses as a result of housing costs, Realtor.com analyst Hannah Jones tells Axios.

By the numbers: Across the U.S. and in Nashville, condo prices are rising faster than single-family home prices, per the latest Zillow data.

  • In May, the typical metro-area condo sold for $372,150, up 5.5% compared to last year. On the other hand, the cost of a typical single-family home fell nearly 9% since last year, down to $422,516.

State of play: Overall sales in the Nashville area last month were down 13% year-over-year, driven by declines in single-family homes, according to Greater Nashville Realtors. Sales were down 28% compared to July 2019.

  • But condo closings were about even with last year and higher than 2019.

What he's saying: "Interest rates are playing such a big part in what we're seeing in the market right now across the board," Greater Nashville Realtors president-elect Kevin Wilson tells Axios.

  • Wilson notes that condos remain a relatively affordable price point compared to single-family houses.

"Buyers are still seeing the value of homeownership," Wilson says. For single buyers and young professionals, "the pathway to homeownership right now is condos."

  • "I think we're going to continue to see that until we see relief on interest rates."
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