Having spent most of my business career in real estate, I see the recent insights provided by the National Association of Realtors regarding the 2024 housing market forecast as carrying significant weight. In a Dec. 13 news brief, NAR’s chief economist Lawrence Yun paints a promising picture for our city. As recently reported by the Scene, NAR places Nashville seventh among the top markets with the most pent-up housing demand. This positions us alongside cities such as Austin, Texas; Dallas-Fort Worth; and Washington, D.C., enhancing Nashville’s appeal and creating an environment conducive to current and potential homebuyers.
Yun states, “Metro markets in Southern states will likely outperform others due to faster job increases, while markets in the Midwest will experience gains from being in the most affordable region.” And according to development firm CA South, “In Middle Tennessee alone, the tech industry is now valued at more than $8 billion and is a big reason why Nashville is growing so fast.” According to U.S. Census Bureau data, roughly 98 people moved to Nashville per day in 2022 alone. So Yun may very well be on target with his predictions when it comes to the growth in the housing market — at least here in Middle Tennessee.
As reported by The Tennessean: “Nashville commands the top spot as the nation’s all-around best market to invest in for the third consecutive year, according to a leading real estate industry report released in November by Urban Land Institute and [PricewaterhouseCoopers]. The report, ‘Emerging Trends in Real Estate 2024,’ highlights the diversity and strength of the Nashville region’s business environment. Nashville is the first city to be named a top market for three years in a row in the report’s 45-year history … The ranking reflects stability across Middle Tennessee’s industry sectors, and in downtown Nashville’s continued ability to lure massive crowds. Suburban growth is also a strong point continuing to fuel high population and job growth.”
Add this to the fact that Yun’s forecast predicts around 4.71 million existing homes will be sold nationally in 2024, and it shows that our city, despite the pandemic years, is still being fortified. Given the steady national median home prices, which are expected to experience only a 0.9 percent increase, some could find compelling reasons to explore real estate opportunities in Nashville or to simply contemplate purchasing a home here if they are considering a relocation.
For current homeowners in the Nashville community who really aren’t investors per se, these predictions still provide good news: The anticipated stability in median home prices signifies a favorable environment. It offers assurance that real estate investments — like our homes — are poised to hold their value, if not experience incremental growth. Some who are considering selling may also feel more confident about their decision, as the market appears conducive to attracting potential buyers.
If we want to add a cherry to the top of this sundae, we can do so by looking at the broader economic context: Yun forecasts U.S. gross domestic product growth of 1.5 percent, steering clear of a recession. Obviously avoiding a recession is what we all want! Further, if you’ve been watching the Dow (DJIA), you’ll note that Jan. 19 saw a 52-week high. Stock market performance can affect real estate. As Ibuyer.com notes, “The stock market and real estate are more closely intertwined than most people realize. … You will want to have a close eye on the stock market if you plan on buying or selling any property.” An increased value of stock assets provides investors more funds to seek out other assets such as real estate.
To that end, Yun foresees “1.48 million housing starts in 2024, including 1.04 million single-family and 440,000 multifamily.” That means we’ll potentially see continued construction activity and an overall expansion in the real estate industry. “In addition,” says Yun, “housing inventory is expected to rise by around 30 percent as more sellers begin to list after delaying selling over the past two years. The selected top 10 U.S. markets will experience faster recovery in home sales.”
NAR’s predictions for 2024 indicate a favorable environment for real estate investors in Nashville and Middle Tennessee. The expected surge in home sales, stability in home prices and positive economic indicators are all good for our city and its growth. That goes for those who live here as well as those who want to live here. As predictions go, I hope Yun is on target. At worst, due to the numerous positives detailed, it’s likely we’ll see some definitive impact in the real estate industry. For sure, we’ll continue to enjoy Nashville’s growth and allure as others realize what we as residents have always known: There’s no place better to make a home than Nashville.
Bill Freeman
Bill Freeman is the owner of FW Publishing, the publishing company that produces the Nashville Scene, Nfocus, the Nashville Post, and The News.
