Rhythm Condos at Music Row Surge in 2012

Rhythm at Music Row Condos

Rhythm at Music Row CondosCall it a sign of the times, but the Rhythm condos at Music Row have prices that are climbing faster than any high-rise condo in Nashville.

A brief timeline: The Rhythm condos began construction at the beginning of 2007 and were completed in 2009. Pre-sales efforts took place during this entire process and condos were sold for an average of $365.17 per square foot. Approximately 75% of the 105 total condos were pre-sold, but when the building opened, only half of the original buyers closed. Clearly, 2009 was a difficult economic time for the country and the Rhythm was not immune. Throughout the balance of 2009 until the end of 2010 the developer continued to sell units. This effort resulted in the sale of 30 additional condos at an average price of $277.20 per square foot. At the beginning of 2011 buyers could smell blood in the water and by the middle of the year the developers were able to reach a settlement with their construction lenders to turn the unsold condos over in a “friendly foreclosure”. Release prices were lowered and all of the remaining condos were very quickly sold at an average of $241.14 per square foot. The last few bank owned condos closed by the second quarter of 2012 and prices have not looked back since.

2012 Q1 Rhythm Condo Sales

Rhythm Condo Prices 2012

2012 Q2 Rhythm Condo Sales

Rhythm Condos Sold Q2

2012 Q3 Rhythm Condo Sales

Rhythm Condos Sold Q3

Current Rhythm Condos for Sale

Rhythm Condos for Sale

(#602 is one of my listings and it was sold in less than a week)

Rhythm Condo Price Analysis

As you can see from the active and pending listings, we have been very successful in raising prices since the 1st quarter. We’ve gone from an average of $249/ft to just over $350/ft in the space of only 9 months (I say we, because my team and I at Metropolitan Brokers have listed and sold many of these condos). This price increase represents a nearly 39% jump in under a year. No other high-rise condo in Nashville has come close. All seven Nashville high-rise condo buildings have realized year over year price increases with the Icon and the Adelicia posting the second and third highest gains. The Icon condos have increased prices 17.24% year over year and the Adelicia condos have increased prices 14.81% year over year.

Selling your High-Rise Condo in Nashville

As many know, not only did I represent more than 22% of the buyers and sellers in Rhythm at Music Row, but I have represented almost 300 other condo buyers and sellers in Nashville. It is from this vast experience that I know pricing is not the only skill required of a listing agent. One must also know how to work with appraisers in order to help support these higher prices once contracted. An agent must have lending resources that can help secure buyers advantageous loans and not lose a potential sale over interest rates or mortgage terms. Your agent must know your building like the back of their hand; they must be able to recite the differences in the floor plans, the views and know what is being developed immediately around your building. Selling is no longer just pricing and putting in the MLS. To properly turn a building around in this economy you need knowledge, skill, reputation, leadership and experience.

With sales of over 300 condos (5 this month) and sales volume exceeding $100 million since 2004, no other broker in Tennessee who did not work directly for the developer can come close to my numbers and expertise. I have always worked for private clients and understand what it is to fully market and engage the marketplace. If you are considering selling your condo within the next year, I would love to interview for your business. If you are not and simply want to know what your condo is worth, I have built a tool to calculate your current market value.

Grant Hammond, Broker, ABR, SFR
Call or Text: 615-945-7123
Condos@GrantHammond.com

City Living Versus Suburban Living

City Living

City LivingAn Op-ed by Kathleen Hubert:

Living in the city compared to the suburbs can be quite a different experience. One of the main differences you would notice when living in the city is the population density. Compared to a suburban area, cities usually have a much higher concentration of people and depending on your preferences, this could be exciting or an annoyance.

Less populated suburban areas have been described as a more calm and serene environment. Large concentrations of people result in a more fast-paced lifestyle, so if you do not wish to be a part of the hustle and bustle then a suburban area is recommended for you. Another rather large difference between the city and a suburban area can be the cleanliness of the area. Cities tend to “have a little more character” on the streets than in a suburb, however the lobbies of hotel and office buildings also tend to be more luxurious.

Depending on the size and age of your family, you can determine whether a city or a suburban area would be the better choice for you. Suburban areas are usually geared towards raising younger children, while city life is better suited for those who wish to have easy access to any area you may visit frequently. Although it may not seem possible, living in the city can also provide you with a better education. Most universities and highly regarded schools are located in areas of high traffic in order to receive more applicants. However, those who live in a suburban area can still attend these schools, it would simply be a longer commute.

While cities may be compact and uncomfortable at times, they provide an enormous amount of convenience. Cities will cluster important places close together, making it less of a hassle to go out and run daily errands. They have higher concentrations of libraries, parks, restaurants, transportation, retail, museums and other culturally significant destinations.

One drawback – it can be next to impossible to save money in the city. As a result of the basic density of the city, land prices and construction costs are typically quite high leading to elevated prices for apartments and high-rise condos. Compared to a highly populated city area, suburban area living expenses have been proven to be much less expensive.

Kathleen Hubert is a blogger who writes for a variety of different sites. You may read more of her work at Modular Homes.

Exciting Changes for Grant’s Nashville Real Estate Blog

Nashville Real Estate Blog

Nashville Real Estate BlogMany loyal readers have emailed or called to ask why I have not published a new real estate article in the past 3 months. The answer is simple: I am upgrading. As many of you know, I have self-built and maintained my Nashville real estate blog since 2005, but I felt it was time to call on the professionals to take my website to the next level.

You will see many new upgrades rolled out over the next several weeks such as a refined look, new search ability, new categorization for easier reading, new social sharing and you will notice the site loading seven times faster than before. This is all thanks to a collaborative effort between Creative Shift Design and Ah So Designs. There will also be several upgrades you don’t notice like cleaner code, new Genesis framework, enhanced SEO and a click through flow. These upgrades are thanks to a partnership between John Householder at Ah So Designs and Ross Jones at 2 The Top SEO (I don’t mind telling you who my SEO is…I have Nashville exclusivity in the real estate category, sorry guys).

When I began this project, like many real estate agents, my goals were simple. I wanted users to have a better experience and I wanted the site to rank better on the major search engines. What I realized is the process to accomplish these goals were more complicated than I had anticipated. Half way through the project, Google executed the Penguin update which shook up the real estate search results quite significantly and caused us to rethink certain aspects of the site. Additionally, I struggled with locating the perfect IDX product to display MLS listings. Ultimately, had John and Ross not been involved, I most likely would have failed to accomplish my second goal.

Serious Money, Serious Real Estate Results

Performing a custom redesign of your real estate website is serious business and not for the faint of heart. Many have asked and I have been very honest, before this project has concluded, I will spend in the neighborhood of $15,000 on designer time, coder time and SEO time. You can literally purchase a brand new Honda Fit or Scion for what it costs to blow out your real estate website. But, this does not bother me one bit as this is an investment in my clients and my readers. It is money well spent and will provide a return.

Ranking Progress and Conservative Prediction

There are in the neighborhood of 45 real estate agents and companies in Nashville who are actively competing for ranking for the major keyword searches in Nashville. On my own, I was never able to rank higher than #4 for the most competitive keyword phrase in the entire state, “Nashville real estate”. I was quite proud of this effort, but I was never going to rank any higher. After our initial relaunch, the site dropped to #12, but that is simply the case every time you redesign and relaunch. Within a week, the site is now back to #9 and climbing for many secondary and tertiary search phrases as well. Conservatively speaking, the site should be back up to #4 by the end of 2012 and continuing to make progress in 2013. Personally, this is the most exciting aspect for me…breaking the glass ceiling just in time for the spring real estate season.

Sharing my Experience and Giving Advice

It is always a goal to help fellow Realtors enhance their business and I am always open to sharing. I intend on periodically updating readers on our progress and I will do my best to answer all of your questions. I do speak at RE BarCamp as well as at several other real estate related conferences and meet-ups, these will be the best places to speak with me in person for a more in-depth conversation. That being said, feel free to leave a comment below with any questions, advice or opulent adulation ♥ It’s good to be back!

Deadline to Challenge Davidson County Property Taxes

Davidson County Property Taxes

The deadline to challenge your Davidson County property assessment is Friday April 20th at 4:30pm. If you do not challenge your property assessment by this deadline, you WILL NOT be able to seek a reduction until next year!

Step #1: Check your new 2011 property tax assessment (click on image below)

Search the Nashville Tax Record

Step #2: Locate your property and click on the record

Step #3: Review your tax record. Most importantly, look down to the “Current Property Appraisal” section and find the “Total Value”. This is the amount on which your 2012 property taxes will be calculated.

Step #4: Click on “Previous Appraisal” in the submenu in the top navigation bar

Davidson County TN Tax Record

Step #5: Compare your current appraisal with the previous period

Previous Appraisal Record

Step #6: Determine if you should challenge your tax value assessment. If there is a large difference in your 2011 assessment over your 2009 assessment or if you know the 2011 assessed value to be higher than recent sales in your neighborhood, challenge your assessed value with the Davidson County Tax Assessor’s office immediately. To challenge your assessment, follow the steps outlined in the article I wrote last November.

Who Should Challenge Their Tax Assessment?

While there is no blanket answer, everyone should check their 2011 property assessment to see if a case can be made for a challenge. I have identified pockets of owners who should challenge their tax assessment immediately: owners of luxury homes in Green Hills and Forest Hills over 4,000 square feet should consider challenging. I spot checked several homes that I own in those areas and 3 of them were over assessed. I also found a few over assessments in Hillwood.

Update 4/18/12

This afternoon I received a call from a principle with ACG Equities, the owner/seller of the 5th & Main condos in East Nashville. He explained that ACG took the initiative to challenge all 129 tax assessments as soon as they became aware of the 2011 assessments. I applaud ACG’s actions and can only hope that Pollack Partners follows suit for the Velocity. No word from anyone with Pollack yet.

Please pass this article along to your friends, family, neighbors and clients.

The Encore Condos in Downtown Nashville Sold Out

Encore Condos Retail Space

Encore condos in Nashville
Less than 2 months after the trendy Music Row Rhythm condos sold out, the Encore becomes the latest high-rise condo development to join the growing list of sold out developments. The 333 unit development, built in partnership between the Novare Group of Atlanta and Tony Giarratana of Nashville, broke ground in mid 2006 and was completed in the second quarter of 2008. In that first year of operation, 214 condos closed (64.26%) at an average price of $301.55 per square foot. As the economy grew weaker, so did the sales volume and pricing in the Encore reaching an all time low of 26 condos sold in 2010 (22 developer owned, 4 private resales). In 2011, the Encore turned the volume corner, but the developer allowed prices to slip to their lowest point by selling 36 condos (26 developer owned and 10 private resales) at an average price of $252.72 per square foot. Contributing to the 2011 price weakness is the fact that half of the resales were distressed sales.

Finite Supply Will Lead to Higher Condo Prices

Now that the developers have zero condos left to sell, true market forces will return to the Encore. Currently, there are 15 resale opportunities listed on the MLS which represents only 4.5% of the entire building. Of those 15 condos, 4 are MDHA income restricted condos leaving 11 market value resales. Of those 11 resales, 3 are currently under contract with another 2 working offers. Moreover, with an average asking price of $293.06, prices have already begun to increase rather significantly. Granted, the final sales price will not be as high as the average listing price, but it is clear that a finite supply of condos in the Encore will result in prices that will soon approach and surpass 2008 highs.

Encore Condos for Sale

Encore Gains Multiple Retail Tenants

It has been several months since celebrated chef Deb Paquette announced her latest venture called Echo (now named Etch) in the Encore, but there are also two more restaurant/coffee tenants readying to make similar announcements. While I am not at liberty to name these tenants directly I can describe one as a high end sushi restaurant that features a rather large and trendy bar. This restaurant will be located next to Etch and be similar in size. The other tenant can be described as a successful local coffee and deli provider who is opening another location. There is no doubt that the impending completion of the billion dollar convention center and hotel complex will contribute to increased retail space leasing activity which in turn leads to an enhanced living experience in the Encore.

Advice and Recommendations

As a condo owner in the Encore and a broker who has represented more than 40 clients in the building, I am in the unique position of being the all time leading outside sales leader as well as an Encore insider. I have crunched the numbers and can steadfastly predict an increase in Encore condo prices over the next 2 years. Buyers who have been on the fence about a purchase in the Encore should have a sense of urgency. Sellers who are considering selling their condo, especially those on higher floors, need to understand the defined finite supply of condos and consider raising their asking prices to match the market. There are no new condo buildings under construction in Nashville and only the Laurel in the Gulch is planned to break ground at some point later this year.

Should you or someone you know be considering making a purchase or selling their condo in the Encore, please contact me. Having sold over 250 condos since 2006, I am the most successful condo broker in Nashville. Put my 10 years of experience to work for you and let me guide you to the most successful and profitable transaction possible.

Grant Hammond, Broker, ABR, SFR, ePRO
Call or Text: 615-945-7123
Encore@GrantHammond.com
View Available Condos

encore condo building nashville

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Future Home Demand in Nashville Jumps, Significantly

Realizing that predicting the real estate market is a dangerous enterprise at best, I feel confident in the simple science behind my prediction that future Nashville home demand will jump significantly in 2012. Before I explain why, let me first explain how I build the total demand curve. I define total demand as the number of homes purchased in a particular month plus the number of pending home sales reported in that same month (some have included the number of residential building permits issued as well, but for the purposes of modeling an actual demand, not a confidence factor, I prefer to keep my curve based purely on the demand side). In my opinion, actual sales and pending sales added together give a real time look into the future health of the market, but rooted in reality. Think of the actual sales figure as the anchor that helps stabilize the sometimes unwieldy predictive value of the pending homes figure. Further, understanding that seasonality plays a role in the Nashville market, I have broken the “demand season” into several separate segments.

Nashville Real Estate Market Demand

As you may have noticed, I have purposefully left out mortgage rates as I believe rates and affordability, to a great extent, will have no bearing upon new purchases for the balance of 2012. For the micro economists out there, yes I realize that it is impossible to hold all other factors constant to specifically measure pure demand in a market as complex as real estate, but bear with me as I strip down purchase demand into its purest state.

For the past 9 years, the average total demand has increased 10.94% between the months on March and June with June being the peak of seasonal total demand. If that same trend were to hold true, the total demand in June 2012 would rise to roughly 4,500 homes. This is a level last achieved in April 2010. If you recall, this was also the period in which the Government back first-time homebuyer credit expired creating an artificial demand. Having already achieved a total demand greater than any month in 2011, it is my conclusion that the Nashville real estate market demand has not only recovered, but may see significant price increases within the next 18 months.

Looking at the More Recent Demand Trend

When we strip out the 2 years of governmental meddling as well as 2003 and 2004 and only consider the 5 most recent years of pure market forces, the average total demand has increased 13.78% between the months of March and June. This more realistic view would predict a demand of almost 4,600 homes, a level not seen since the seasonal highs in 2008. More importantly, this level of demand is similar to what was achieved in the first quarters of both 2004 and 2005. While it is too soon to predict the next boom, I do feel that Nashville is firmly entrenched in a steady recovery that will lead to price increases.

Adding to the strength of the recovery is the fact that the Millennial generation (born between 1980 and 2005) has been graduating from college and graduate school for several years. This is significant as the Millennial generation, sometimes called Echo Boomers are the largest generation of Americans, ever. Millennials are 1.3 times larger than the Baby Boomers and over 3 times larger than Generation X, my generation. Millennials have many of the same values as their parents with home ownership being a focus and main definition of their self worth. It stands to reason that as this generation comes of age, so shall the real estate recovery.

Nashville Market Gains Confidence

In speaking with several colleagues at REBAR last week, almost all report the number of multiple-offer situations and “bidding wars” having increased significantly in recent months. Moreover, 8 out of 10 polled Realtors reported an increased confidence among their buyers and 7 out of 10 reported an increased confidence among their sellers.

Further, having the confidence that mortgage rates will remain relatively low through late 2014 due to the Central Bank’s decision to hold short-term interest rates near zero for the next 28 months, has set the stage for a 28 month purchase window. Buyers are certainly not in a rush, but most now operate with the understanding that purchasing a home within the next two years represents their best chance at optimizing the affordability factor. However, as many begin to see increased pricing in the more desirable areas of Nashville, many will pull the trigger in 2012 to further optimize that transaction. Areas like 12th South, Green Hills, Vanderbilt and the Gulch have already seen significant price gains in the past year.

Work with Grant Hammond

I have a true passion for real estate. Each transaction becomes personal and every deal is negotiated as if it were my own. I would never advise one of my clients sign a purchase or a sale I did not believe in. Many of my clients describe my real estate practice as professional, thorough, and detailed oriented and some have even called me anal and slightly obsessive. I feel all are compliments. But, the one trait I possess that very few agents have is the ability to walk away from a deal. In that I mean, I am financially in a position that allows me to advise my clients to walk away from a deal that is not perfect and continue looking for the best property or wait for a better offer. It has always been and always will be my goal to put my clients in the best position to succeed.

Grant Hammond, Owner/Broker, ABR, SFR, ePRO
Call or Text: 615-945-7123
Grant@GrantHammond.com

Real Estate Success

Navigate back to my Nashville real estate home page to see additional articles I have authored.

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