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VOL. 39 | NO. 11 | Friday, March 13, 2015

Surprising February sales to continue through March

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February sales are up again, this time by 12.6 percent compared to last year’s sales for the same month, according to Greater Nashville Association of Realtors sales figures.

What is surprising to those who monitor such data is that the total number of sales is 2,091 units. As recently as 2011, that number was 1,134, up from 2009 and 2010. Such a number was formerly reserved for months like April, the beginning of the spring market, and April only reached a number as high as 2,091 in 2012.

“February saw its best monthly sales numbers since 2007,” says GNAR President Cindy Stanton. And 2007 was the best year in the history of these numbers being on record.

As the hot streak continues, pending sales were listed at 2,458 at the end of the month, compared 2,221 last year. So sales for March will be higher, as well, and that is wild based on the snow and ice the area experienced last month.

So neither snow, nor ice, nor slippery roads can slow this real estate market.

One thing that can slow any market is the depletion of product, in this case inventory. GNAR numbers reflect that there are some 7,912 single-family homes for sale and 814 condos.

Condo inventory down 20 percent, and single-family is down 10 percent. With sales up 12.6 percent and inventory down about 15 percent, the outlook is not favorable for buyers.

Real estate appraiser and GNAR past president Richard Exton investigated further and found that in Davidson County there are 5,200 single-family homes on the market listed as active. However, 2,165 of those are under contract with some contingency, i.e., inspection, financing, or some other.

Therefore, only 3,035 homes are on the market. With condos, it is more drastic with 497 listed as active and 300 of them under contract, so only 197 condos are actually for sale.

Part of the inventory shortage is based on homeowners being hesitant to put their houses on the market since there is nowhere to go if their house sells. And that means nowhere as the rental inventory is as low as that of homes for sale.

Metropolitan Housing and Development Agency has an enormous number of potential renters that are unable to find housing of any kind.

So Nashville is in a reverse Field of Dreams syndrome – they are here and more are coming, so we had better build it.

Sale of the Week

With discussion of affordable housing being front and center, there are some affordable houses changing hands in town.

For example 325 Cedarview Drive in Dreamland Estates, located off of Exit 59 of I-24, roughly 100 yards from the back door of the Nolensville Road Walmart Supercenter, sold for $90,000 in 155 days after having been listed for $95,000.

This house has 1,224 square feet on the main level and an additional 396 in the basement with three bedrooms and two full baths and is located on.23 acres.

Marjorie Seward of the Realty Association wrote in her Realtor remarks: “Short sales AS IS, requires lender approval. Will not go FHA.”

She wrote in the remarks that are viewed by the public that the house is “A nice-size home in need of work. Good investor property. Price has been set by third party and is firm.”

Saying a house will not go FHA is Realtorspeak for there is something other than design or cosmetic wrong with this home. In other words, plumbing, electrical, HAVC, roof, windows or structural issues may exist.

And when the I-word, investor, is invoked, it often suggests that this home is not ready for prime time, or an end user.

Many Realtors continue to receive calls from buyers begging for short sales, the homes that are being sold for less than the balance of the loans on the properties.

This home was purchased in 2010 for $123,000 and sold for $90,000 last week. So it was purchased when property prices were coming off of all-time lows and when lenders were scrutinizing buyers, yet when Nashville area sales are beating all records it sells for 27 percent less than the buyer paid.

The reason for the radical drop, according to Marjorie Seward, is that mold has invaded the basement, and the central heat and air had ceased functioning.

So the new owner would have to mitigate the mold and install new HVAC immediately.

In the $95,000 price range, few owners have $10,000 or $15,000 remaining for repairs after down payment and closing costs.

For affordable housing to be affordable, it must be functioning and affordable.

Richard Courtney is a real estate broker with Christianson, Patterson, Courtney and Associates and can be reached at richard@richardcourtney.com.

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 0 0 0
MORTGAGES 0 0 0
FORECLOSURE NOTICES 0 0 0
BUILDING PERMITS 0 0 0
BANKRUPTCIES 0 0 0
BUSINESS LICENSES 0 0 0
UTILITY CONNECTIONS 0 0 0
MARRIAGE LICENSES 0 0 0