With supply rising, why aren’t prices dropping?
“Inventory rises to its highest level Since November 2020” reads the headline atop this month’s the latest news from the Greater Nashville Realtors.
The rise in inventory brings joy and hope to the hearts of homebuyers who have been shunned by the market for the past two-plus years. Yet, the glass remains half full: The organization also reports sales of 3,982 homes in May, meaning there is a 1.5-month inventory on hand.
While many suggest the market has cooled, Greater Nashville Realtor president Steve Jolly was quick to extol the rise in inventory – from 4,308 to 5,836 – by stating “Residential single-family home inventory grew by 47% over the last month as the combination of higher prices and skyrocketing interest rates limit what buyers can afford.”
The median sales price, meanwhile, hit an all-time high of $498,785.
So, the market is slowing, but sales price hit an all-time high? That is not a slowdown. It is not a cooling. It is realty insanity, defying logic.
Unit numbers drop by 2%, inventory increases by 47%. So, the result should be a price decline. But no.
Prices seem closer to tapping the brakes, yet the multiple-offer scenarios proliferate the market. Here is why:
Realtor president Jolly is right. Rates have changed the ability of certain buyers to purchase the homes they want at a certain price. Now, the price is lower. The buyers are going to buy.
Now the $500,000 price range is filled with buyers formerly known as $600,000 buyers. However, the buyers are there, and they are buying. They are buying different houses. Buyers have retooled. Sellers are learning. Aren’t we all?
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Sale of the Week
The ridge-top modern estate located at 1801 Laurel Ridge Drive sold recently for $7.7 million, way down from its list price of $7.8 million, a price point in which coming down $100,000 was not a point of contention, one would hope.
Listed by Stephanie Soper and French King Fine Properties, this gem was certainly a fine property, an understatement and obvious point. Rarely do people pay $7.7 million for properties that would not fall into the “fine” category.
Soper has represented this seller several times during the past 15-20 years, all with similar results, although this $7.7 million number ranks as one of the top sales for properties with fewer than 10 acres.
With its panoramic view, it could be argued the property encompasses hundreds of miles of acreage, as there is nothing obstructing the sightline from the rear door for miles, making the 1.74-acre lot the home inhabits meaningless.
In addition to being located on one of the city’s best lots, the quality of the construction is unsurpassed with its cedar-shake roof, rough-sawn timber and Crab Orchard stone fa?ade.
Inside the 7,542-square-foot house, there are rooms with ship lap wall and rough-hewn pine ceilings among the five bedrooms and five bathrooms, along with peacock pave flooring featured in some of the rooms.
As has become popular, there is a folding glass door onto the porch with its sweeping view of the city below.
The street was once home to international rock star Steve Winwood (Traffic, Spencer David Group) and his wife, Eugenia.
Included is a garage capable of housing 12 vintage cars.
Even with a price tag of almost $8 million – a hefty $1,034 per square foot – it took only a matter of hours for Soper and King to procure the buyers for this Nashville treasure.
Richard Courtney is a licensed real estate broker with Fridrich and Clark Realty,LLC and can be reached at [email protected].