VOL. 37 | NO. 37 | Friday, September 13, 2013
How do soaring sales result in lower prices?
With 3,084 closings in August, home sales increased 18.3 percent compared to August 2012, Greater Nashville Association of Realtors numbers show, and are up 22.8 percent year-to-date.
Pending sales are at 2,888 properties, up from 2,572 pending sales a year ago, ensuring September will be another banner month. Pending sales at the end of October will be the number to watch as interest rates have inched upward.
Still, these numbers represent a staggering increase, as there were 2,029 sales in August of 2011 up from 1,594 in August of 2010. To recap, August 2013 is up almost 100 percent compared to August 2010, and the pending sales point to even more growth going forward.
While there are 478 additional sales in 2013 over 2012, inventory for the same period is down 1,973 units in 2013 versus 2012, indicating that there are more properties being sold than entering the market. As a result, prices are continuing to rise with the median price of a single family home increasing from $175,000 in 2012 to $194,000 in 2013.
Now a tidbit for the prandial pundits among you: Even with all of these increases in unit sales, the depletion of inventory, the rise in pending sales, and the fact that year-to-year comparisons show increases in the median prices, the median price has dropped in each of the last two months over the previous month.
Throw that statistic at your breakfast club or power lunch.
In June, a mere two months ago, the median price for a single-family home hit $205,000, its highest in years. In July, the median price was $204,000, nothing to get hung about, but down.
And in August, that number slipped to $194,000. The same is true with condos where the median price fell from $159,500 in June to $154,500 in July to $147,638 in August.
Higher interest rates lead to lower prices.
The Sale of the Week
This week, I’ll take you out to the ballpark. Germantown is taking the city back to the future as the proposed site of a Nashville Sounds stadium roughly where the old Sulphur Dell baseball stadium stood years ago.
Some may wonder about the name Sulphur Dell, as it memorializes a chemical element with the symbol of S and the atomic number 16 and smells like rotten eggs.
Yet, in the Germantown area, according to the late Mary Catherine Strobel, there were springs producing sulphur-laced water with medicinal qualities.
Perhaps Mayor Dean should fill the Council water coolers with the pungent potion before they vote.
The real estate market has been cured there for some time and attained 12South-type status as a sound investment even before the announcement of the baseball plans.
Nancy Hardaway, Andre Lequire and Scott Chambers were the Abner Doubledays of the area and have been hitting real estate home runs for years along with the Green Team version of the DiMaggios, the Lawrence brothers.
While Joltin’ Joe has left and gone away, Skip Lawrence has assumed the role of leader in green building for a decade and has constructed numerous green homes on infill lots in Germantown. While the Lawrences are infillers, the DiMaggios – Joe, Dom, and Vince – were outfielders.
While the brothers Lawrence did not build 1806B 7th Avenue North, the home listed by Jessica Demas of Village Real Estate Services is as green as a gourd.
It features a tankless water heater, energy star windows and spray-foam insulation, all standard fare for Germantown these days.
The design of the home is open and airy with vaulted ceilings high enough for the enforcement of an infield fly rule.
Taking a page from the Wrigley Field playbook, this home offers a rooftop deck that will soon allow fans to behold the balls flying out of the yard when the Ruthian clouts sail into orbit.
There are three bedrooms and three and a-half baths in this new construction with a membrane roof, one-car garage and, according to Demas, a “massive master suite with a balcony.”
Jay Nelson of RE/MAX Elite pitched in the buyer, who paid $325,000 for this piece of history that includes 1874 square feet.
The home includes rustic hardwoods and custom cabinets. There two structures were built where there was once one, and the developer paid $81,000 for the property, or $40,500 per lot.
Speaking of baseball, GNAR is hosting its first soon-to-be-annual Home Run, a run/walk staring at Greer Stadium this Saturday. The run benefits Habitat for Humanity and will be a four mile course around downtown. Come on out. It should be fun.
Richard Courtney is a partner at Christianson, Patterson, Courtney, and Associates and can be reached at Richard@richardcourtney.com.