5th & Main Condo Sales Update

Fifth and Main condos Nashville

5th and MainWell, there really is not a whole lot to report here except for the fact that there have been no new closings since my last report in August. Since Wachovia let the East Nashville 5th & Main project slip into receivership, there has still only been 2 brave souls to take the plunge.

The Tennessee Disability Coalition bought the 1,429 square foot condo #602 for $285,000 recorded with the Davidson County Register of Deeds on August 6th, 2009. This condo is a downtown facing 2 bed, 2.5 bath unit that was originally listed for $328,900. The sold price represents a 13.35% discount and totals $199.44/foot.

Mr. B. Teveit bought the 1,144 square foot condo #604 for $206,000 recorded with the Davidson County Register of Deeds on August 12th, 2009. This condo is a downtown facing 1 bed, 1.5 bath unit that was originally listed for $263,900. The sold price represents a 21.94% discount and totals $180.07/foot.

Both of these purchases could be at or even below what their replacement costs would be in 2009.

The 5th & Main project entered into receivership in February of this year (not foreclosure) and has not emerged since. The possibility that this development may be actually foreclosed upon still exists. Village Real Estate is the listing company.

Nashville Mortgage Rates Move Lower

Mortgage Rates 9-15-09

Freddie Mac reported a dip in borrowing costs for long-term mortgages this week. According to the federally chartered company, the average interest on 30-year loans fell to 5.08 percent from 5.14 percent a week ago; while rates on 15-year loans came down to 4.54 percent from 4.58 percent. Adjustable-rate mortgages declined as well, with the one-year ARM sliding to 4.62 percent from 4.69 percent and the five-year ARM moving down to 4.59 percent from 4.67 percent.

Banks are still leery of investment purchasers and are typically hitting the above rates by a full point. Lenders are really after the crème of the crop primary residence buyers in Nashville who have good credit scores and a decent amount of monies in reserve. The good news is that most banks are loosening their down payment requirements and are starting to look at second home buyers as humans again.

Average Tennessee Closing Costs Going Up

Bankrate.com recently conducted its annual national survey of average origination, title, and closing costs, for a representative $200,000 loan, assuming a 20 percent down payment and good credit.

Nationwide, the average origination and title fees on a $200,000 mortgage this year totaled $2,732, according to Bankrate’s annual survey of closing costs. The fees in the survey don’t include taxes, insurance or prepaid items such as prorated interest or homeowner association dues.

So how did do, and where did our state rank nationally?

Tennessee ranked 12th highest in the nation (a significant jump from our 24th place ranking in 2008) with total average costs of $2,901 … $169 higher than the national average. Of course, $169 in the grand scheme of a $200,000 home purchase is not that significant.

[SOURCE: Bankrate.com]

Icon Nashville Condo Prices Going Up

If you are one of those folks who thought that condo prices would continue fall this year, here is a piece of news that will surprise you: The developers of the Icon in the Gulch, Bristol Development and MarketStreet Enterprises, are raising prices today.

Specifically, the Icon is raising prices on all of the downtown facing 1 bedroom and 2 bedroom condos in the building. Looking at the total closings in the building, more than 60% of the downtown facing tower condos have closed and an unknown number have new contracts that will most likely push the total over 65% closed.

According to Brian Merrill, President of condo sales for the Bristol Group, “sales have been very strong over the past several months.” I should say that statement may one of the larger understatements of the season considering that the Icon closed 13 condos in August alone, tripling their nearest competition.

Naysayers will surely question the longevity of this price increase, but after personally selling 4 downtown facing condos in the Icon within the past month, I have seen firsthand how difficult negotiating has become. The developers are still flexible on the residential mid-rise section of the building as well as in the tower section facing the Terrazzo. But, if you wanted that panoramic view of downtown at the lowest possible price…you just officially missed the boat.

If you would like to see all 171 closings in the Icon, please reply below and Grant Hammond will contact you within 24 hours.

The last 5 closings in the Icon in the Gulch

Unit No. Name Price Floor Plan Sqaure Feet Price/Ft
1716 M. Howell $235,720 Eclipse 710 $332.00
1511 J. Bechke $315,000 Skyline 945 $333.33
1611 D. Zobl $315,000 Skyline 945 $333.33
1415 Y. Redhi $425,000 Panorama 1,298 $327.43
1011 T. Morris $310,000 Skyline 945 $328.04

 

View all condos for sale in the Icon in the Gulch

Tollgate Village in Thompsons Station Rumor

The previous content was removed at the request of James Carbine.

The only factual part of the story I feel comfortable posting at this point is the sales summary from the local MLS (I apologize to those sources who brought the original story to light, but I am not going to risk a frivolous lawsuit):

As of September 12, 2009: There are 21 homes listed for sale on the MLS, one of which shows an offer made. There are also 2 homes pending. Through the first 8.5 months of the year, only 4 homes have closed for an average $477,062 or $114/ft. One of these homes was a , one was sold for $140,000 less than original listing price and the other 2 were pre-sales. These prices represent rather large discounts from the year before when the 18 closed sales averaged $140/ft.

The story appears different in their condo/townhome product. Currently, there are only 4 listed for sale, 7 pending and 3 that have closed in 2009. Three of the active listings are representative ‘to be built’ listings.

Update 9/25/2009 – Thompson’s Station Officials sue Tollgate Farms

According to the Tennessean: “On Tuesday, Thompson’s Station officials filed a in Williamson County Chancery Court against Tollgate Farms, which is being developed by James Carbine. The complaint states that the development is required to dedicate land to the town for use as a wastewater treatment area. The town demanded that Tollgate convey the land on Aug. 24, but that hasn’t happened, according to the suit. The lawsuit also states that several roads in the subdivision are in need of repair.” – (thanks to Edgar for submitting the story)

* A reminder to those who wish to publish rebuttals. All of those will be published except for those who do not identify themselves. If you are willing to say it, you must stand behind it as I do.

August 2009 Nashville Real Estate Market Analysis

2009 Percent Change AugustThe Middle Tennessee MLS (Realtracs) just released August 2009 stats. The following graph and analysis are based upon the residential single family homes and condos market only. As you may recall in July, closings and prices increased while total inventory was on the fall. Did August continue to buck the national trend or is it time for our typical seasonal fall?

Total Inventory (Okay, Getting Better)
Inventory levels continued to decrease in August, down 1.22 percent from July, but still up 8.86 percent since January. There were a total of 17,318 active homes and condos in Nashville last month, compared to August 2008 when there were 18,211 on the market, an encouraging year over year drop of 5.16 percent.

Pending Sales (Excellent, Improving)
Pending sales in Nashville are up rather significantly in 2009. Since January, pending sales have soared 70.12 percent higher. Also, for the first time this year, total pending sales are higher than their levels a year ago. August 2009 levels are 1.45 percent higher than August 2008 when 2,149 total properties were pending. This is very, very surprising news and represents a 12 percent month over month turnaround in addition to being a new 2009 benchmark high.

Closed Sales (Good, But Falling)
For the first time in 2009, total closings did not experience a month over month gain. Since January closings have risen 113.7 percent, but this number does represent a 13 drop from July. Compared to the same period in 2008, year over year closings have only decreased 9.97 percent when 2,172 properties closed. In addition, we have narrowed the gap over 2008 by another 2.1 percent during the past month. The fall in closings can be directly attributed to our natural seasonal drop, it is the 2.1 percent narrowing of the year over year gap that is encouraging.

Median Prices (Worse)
August saw the largest, and first since March, month over month price drop of 2009, dropping a full 8.25 percent to $158,376. Part of this drop can be directly attributed to first time home buyers and the other to the increasing numbers of short sales and foreclosures. The median price is down 9.75 percent compared August 2008 when the median price was $175,504.

Months of Inventory (Steady)
Based on Augusts’ closed sales, it would take 8.77 months to clear it out our excess inventory. Based on pending sales (contracts accepted but not closed yet) it would only take 7.946 months. Our absorption rate is significantly better over the past 3 months when we had 10.2 months of inventory based upon the same calculations – an 18% burn off decrease.

As I begin to take seasonality into account, I am seeing that the second half of 2009 is shaping up to be stronger than the second half of 2008. Yes total closings fell, yes the median price took at hit, but the graph clearly indicates that our overall market health is improving. We do expect the median price to continue to bottom feed for the remainder of the year as less million dollar properties are trading hands.

Prediction
Quite a few banks and lenders will be taking back properties this Fall. Look for median prices to decrease and closings/pending to increase, especially in the year over year analysis.

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