NASHVILLE, Tenn. (WKRN) — After months of uncertainty, it looks as though Nashville rents are on the rebound.
New data shows perhaps we’ve reached a turning point in the Nashville rental market, as more supply is being met with even more demand.
“With things opening up, I see a restored confidence in prospective renters, and I think they better and more comfortable to committing to a lease,” said Ashley Smith, property manager at RENU Property Management.
The Greater Nashville Apartment Association (GNAA) just released its Quarter 1 market survey and found that despite the 2020 pandemic, the Greater Nashville rental housing market in Quarter 1 of 2021 predominantly saw growth over Quarter 1 of 2020.
“Since developers often have to forecast a market’s economic trends several years before they make a decision to build, the growth of apartment units in Middle Tennessee shows strong confidence in the region’s economic recovery. The number of new residents moving to middle Tennessee has been historically strong and recent jobs announcements like Apple and Oracle only reinforce that perception. Anyone who has been in the housing market can tell you the market is strong and there are no indications the market will be slowing any time soon,” GNAA wrote in a statement to News 2 Monday.
GNAA’s also found there are currently 19,557 units under construction, an increase of 38.22% over 2020. In addition, 987 apartment units delivered in Quarter 1, this was a 176.47% increase in delivered apartments over the same period in 2020.
“The past year has been challenging for both tenants and landlords as job loss and changes to leasing regulations have impacted the historic relationship between some property owners and renters. As we come out of the pandemic, the market will have to respond to growing demand and our data shows that’s happening in a whole variety of submarkets. The Q1 report shows the development community continues to be optimistic about the market’s recovery,” the written statement continued from GNAA.
New Apartment List data shows rent rebounds across the country, with their national index increasing by 1.9 percent over the past month, the largest monthly increase since they started keeping track of the data in 2017.
Some of highlights in Nashville this month from Apartment list include:
- Rents in Nashville increased 1.9% month-over-month, compared to 1.9% nationally. Month-over-month growth in Nashville ranks #39 among the nation’s 100 largest cities.
- Year-over-year rent growth in Nashville currently stands at -0.7%, compared to 2.7% at this time last year This is the #23 fastest decline among the nation’s 100 largest cities.
- Median rents in Nashville currently stand at $1072 for a 1-bedroom apartment and $1236 for a two-bedroom.
“I do think market rents have bounced back to what they once were,” Smith said. “I know that we are renewing tenants and putting new homes on the market, in my company, RENU, for 3-5 percent above from what we leased them for last year.”
Though occupancy dropped in 2020, the Greater Nashville Apartment Association says within the last year, rents increased five percent due to low inventory with houses and high market demand.
“The inventory is so low I know where building tens of thousands of apartments over 3-4 years, I don’t see that slowing down,” Johnny Lee said, co-owner of the Ashton Real Estate Group. “There’s such a huge need of people moving in and low inventory of homes to buy there only choice is to rent.”
But that rent comes at a price. GNAA data shows the average highest rent is in downtown Nashville at around $1,900. The cheapest average is near Union Hill by Goodlettsville, at just over $1,000.
“I definitely don’t think we’ll see things go any lower, but as people continue to move here as they are, and communities start to lease and reach occupancy that they want to be at, I do think you’ll see increase overtime, I think that will continue,” Smith said.
Experts say the numbers show confidence in the market and a small sign that apartment living, following a pandemic, is re-gaining its appeal.