Brentwood Homes Short Sale and Grant Hammond

Governors Club ForeclosureThis article entitled “High-end homes take a hit” appeared in the Williamson AM on September the 11th, 2009. The author is Nancy Mueller:

BRENTWOOD – Short sales and foreclosure sales are now being seen in some of Williamson County’s most expensive neighborhoods.

During the first week of September, there were four short sales available in the Governor’s Club, plus one foreclosure. Down Concord Road at Hampton Reserve, there was one foreclosure and one short sale.

These distressed situations translate into some excellent buying opportunities.

“If you are an executive who is moving to Nashville and you want a $1.5 million house, you only have to spend a million point two,” said Grant Hammond, a Cool Springs-based agent who is launching a Web site called that will list short sales and foreclosure sales in the Nashville area.

But even Hammond may be under-selling some of the deals to be had in the upscale neighborhoods.

A five-bedroom, custom-built home that backs up to the second hole at the Governors Club golf course is a “short sale steal” according to agent Vanessa Stalets. The owners’ asking price is $1.25 million. Stalets says the owners paid $2 million for the house, which was built in 2005 and is at 217 Governors Club Way.

Another Governors Club short sale is a 6,000-square-foot home at 4 Spyglass Hill that was listed for $1,398,000 in May. The price dropped to $1,249,000 and then to $1,099,000. On Sept. 2, it dropped again to $1,050,000.

The house has four bedrooms, four bathrooms and two powder rooms and, according to Hammond, “another rare feature” – gap equity.

“This is going to be a heck of a deal for the just-under million dollar buyer,” he said.

Some fear stigma of cuts

The short sales and foreclosure sales in Hampton Reserve and Governors Club are among 111 that Hammond found while researching information for his new Web site. There is no central clearinghouse or system for finding such sales, and sometimes listing agents do not promote the nature of the price cuts.

“There is some debate that the words ‘short sale’ or ‘foreclosure’ stigmatize the property,” Hammond said. “A buyer may assume that there is something wrong with the property itself, beyond the financing.”

That is not necessarily the case, although it is possible that such properties might not have been maintained normally and buyers should be prepared for the fact that if the seller is a bank, it may be pointless to negotiate for upgrades or home improvements within the offer to buy.

Additional deals in Governors Club and Hampton Reserve include:

• 2 InnisBrook Lane, a short sale, has 4,735 square feet, four bedrooms, 3½ baths, a pool and hot tub. Built in 2002, its asking price is $889,000.

• 9554 Sanctuary Place, a foreclosure, has 6,988 square feet and was built in 2006. With five bedrooms, 5½ baths, a four-car garage and an elevator, it is listed for $999,999. It sold in 2007 for $1.345 million.

• 9576 Hampton Reserve, a short sale, is listed for $1,295,000. It’s a lot of money, but this house sold in September 2005 for $1,525,000. It has 7,782 square feet, five bedrooms, five bathrooms, two powder rooms, a theater room, a stocked wine cellar, a five-car garage and an elevator.

With a little effort, high-end buyers can sniff out additional deals these days, such as the mansion at 1216 Waterstone Boulevard in Laurelbrooke.

With more than 11,000 square feet, an elevator, pool and six fireplaces, it is listed for $2,399,000. According to the agent, the sellers invested $2.8 million in this house, which was built in 2006.

• 10 Sawgrass Lane, a short sale, is a 4,642-square-foot home built in 2006 listed for $749,000, down from $930,000. It has five bedrooms, 4½ baths.

• 91 Governors Way, a foreclosure, has 6,242 square feet with five bedrooms, five baths and three half-baths. It has a full basement. Built in 2007, its price is $749,900.

5th & Main Condos in Nashville Update

Quick condo sales update for the 5th & Main condo project in Nashville.

As of September 4th, 2009 there have still only been 7 total sales in the building despite all of the hoopla. 5 of those condo buyers closed prior to the project slipping into receivership in February of 2009. The last 2 buyers, all cash buyers by the way, closed on August 6th and 12th.

The Tennessee Disability Coalition was the first buyer who paid $285,000 for a 1,429 square foot 2 bedroom condo on the 6th floor (though I am not sure the non-profits who donate to this organization would approve of this particular use of funds). The second buyer was B. Teveit who paid $206,000 for a 1,144 square foot 1 bedroom condo on the 6th floor.

An August 7th Tennessean article quoted the seller’s real estate agent Mark Deutschmann from Village Real Estate as saying that “five sales are pending for buyers paying with cash”, but clearly only 2 have closed as of September 4th. Is it possible that the remaining 3 buyers got cold feet? with the impending FHA changes, I hope so for their sake.

I am sure some of you will take the above information with a grain of salt, but in checking with the Davidson County Register of Deeds, there are also several pending mechanics liens against the property totaling over three quarter of a million dollars. In addition, a source very close to the project told me that “the developers still owe vendors millions”. Now that will wake you up in the morning!

Official recommendation: Wait and see what happens by the end of the year prior to buying at the 5th & Main in Nashville, TN.

Why: Wachovia can and might foreclose on the entire 3 phrase development if a cash buyer waltzes by with $18-20 million. If that happens, deals and steals shall ensue.

Davidson and Williamson County $500k to $1 mil Inventory Analysis

To summarize the $500,000 – $1,000,000 housing inventory in Davidson County Vs. Williamson County:

Davidson County Real Estate Inventory

In Davidson County, there are currently 374 homes listed for sale on the market.

Over the past 3 months 76 homes have closed in this price range. That means at the current absorption rate, there is 14.76 months of inventory on the market. Not too bad for an economic recessionary period.

However, if I look at all homes sold in 2009 in this price range, there are 151 homes which gives me a monthly closed average of only 18.875/mo. At this absorption rate, there are 19.81 months worth of inventory on the market. Again, this is not that still all things considered.

Williamson County Real Estate Inventory

In Williamson County, there are currently 704 homes listed for sale on the market.

In the past 3 months 167 homes have closed in this price range. That means at the current absorption rate, there is 12.64 months of inventory on the market. I think this is very strong.

However, if I look at all homes sold in 2009 in this range, there are 338 homes which gives me a monthly average of 42.25/mo sold. At this absorption rate, there are 16.66 months worth of inventory on the market. A year and a half of inventory in the price range in these economic times also seems very reasonable to me.

Given the numbers above, it is clear that the Williamson County market is outpacing the Davidson County single family home market in the $500,000 to $1,000,000 price range. There are also a few other factors that must be considered: 1) January 2009 was the worst month for closings since 1994 with less than 1,000 total closings in our MLS area, 2) these numbers have not been adjusted for seasonality, and 3) remarkably, total closings are up 130.9% since January based on end of July 2009 numbers.

All in all, I would say that the Davidson County and especially the Williamson County markets are doing very well. Anytime you see less than 2 years of inventory in a specific price range during a real estate down time, it is a clear indication that the market is not overbuilt. Accordingly, I would expect this market to be one of the first to experience appreciation during the next cycle.

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