Nashville Real Estate | Housing Market and Mortgage Updates - Nashville, TN

April Home Sales Data - Nashville, TN

2008-05-09T22:03:00.002-05:00

There were 2,135 home closings reported for the month of April, according to figures provided by the Greater Nashville Association of Realtors®. This represents a decrease of 28.5% from the 2,989 closings reported for Nashville the same period last year.

Year-to-date closings are down compared to last year with 7,898. That is a 28% decrease compared to the 10,979 closings reported through April 2007.

There were 2,342 sales pending at the end of April, compared with 3,339 sales that were pending at the same time last year. The median residential price during April was $180,000 and for a condominium it was $162,000. That compares with median residential and condominium prices at this time last year of $177,900 and $163,900 respectively.

The average number of days on the market for a single-family residence was 80 days. Inventory at the end of April was 24,670. That compares with an inventory of 20,129 at the end of April 2007.

These increasing inventory levels will most certainly lead to higher foreclosure levels in 2008 over those of 2007. We also look for the Nashville rental market to heat up this summer. If you are looking for a Nashville rental home, we suggestion you contact Summit Property Management: Nashville Property Management

Catch Your Breath, Mortgage Rates Change Little

2008-05-05T09:48:00.006-05:00

Long-term mortgage rates saw very little change over the past week, according to Freddie Mac. The company said that interest on 30-year fixed loans came in at 6.06% compared to 6.03% for the previous week. Other rates registered a little downward movement, but not much, with the 15-year fixed mortgage averaging 5.59% compared to 5.62% a week earlier and the five-year hybrid adjustable rate floating up to 5.73% from 5.68% over the same period. The one-year ARM, meanwhile, held steady at 5.29%.

It does not appear that there is much mortgage rate relief in the immediate future. The bond rates are fluctuating, the New York Stock Exchange is unpredictable, and mortgage backed securities are not seeing the funding required to lower Nashville rates.

The Icon in the Gulch in Nashville, TN

2008-05-03T20:55:00.000-05:00

Here are some elusive photos of the new Icon project in the Gulch area of Nashville, TN. The project is coming along great, but the lobby and 6th floor amenities are not complete yet.

This is the courtyard pool on the Terrazzo side of the building. This is not the main pool or main amenities for the Icon.

This is a super cool water feature, it is almost a lazy stream that meanders throughout the courtyard.

Another view of the courtyard and lazy stream. Notice how it appears to empty into the pool.

A typical hallway in the Icon. I like how the ceiling lighting is "outside the box" thinking and not the typical can lighting. If anyone has anymore great photos of the Icon, please send them along and I will post on the blog!

WSJ Reports Slowing Mortgage Delinquencies

2008-05-01T10:22:00.002-05:00

“The subprime mortgage market still is getting worse each month, but there are some indications that the massive problem of borrowers falling behind on their loans may be moderating.

Data provided recently to holders of securities backed by subprime mortgages showed that the number of borrowers who were delinquent on their home loans rose at a slower pace in April than in March. It was the third month in a row in which mortgages went bad at a slower rate.

…While it is hard to predict when the subprime market will hit bottom, some analysts think the recent data indicate that some sort of stabilization is under way.

“The trajectory is beginning to flatten out, and this could be a turning point for prices” of mortgage securities, said Glenn Schultz, a senior analyst at Wachovia. As many poorly underwritten subprime loans made between mid-2005 and mid-2007 go bad early in their lives, Mr. Schultz expects the remaining loans to perform more normally.”

[SOURCE: Wall Street Journal]

This news does point towards a slowing foreclosure rate in the future, but foreclosures usually lag 4-6 months behind mortgage payer delinquency. I believe that this summer will see the most foreclosures in Tennessee in recent history and that stabilization will not return to the immediate Nashville area until the beginning of 2009.

Nashville Area Mortgage Rates Jump Higher

2008-04-28T11:34:00.002-05:00

Freddie Mac reports a jump in the 30-year fixed mortgage rate to 6.03% during the week ended April 24 from 5.88% the prior week, marking the first time in six weeks that mortgage rates rose above 6%. The 15-year fixed mortgage rate climbed during the same period, edging up to 5.62% from 5.40%. The five-year adjustable mortgage rate increased to 5.68% from 5.48%, while the one-year adjustable rate shot up to 5.28% from 5.10%. Freddie Mac chief economist Frank Nothaft attributes the gains to heightened inflationary concerns.

The Fed does meet later this week to consider dropping bank discount rates from 2.25% to 2%. While that rate cut is expected to happen by Thursday, we do not think that Nashville residential mortgage rates will be affected very much in the short term. Some lenders like Countrywide may see a little relief the following day, but we expect that rates will continue to climb shortly thereafter.

Foreclosure Opportunity in the Green Hills Area

2008-04-25T15:12:00.002-05:00

These 2 town homes were taken back by the bank a while ago and have been finished by the bank. Each side of this property is a 3 bedroom, 2.5 bathroom, 2 car, 2,709 square foot separate town home that features hardwood floors, granite counters, and even a stacked stone outdoor fireplace. It is a little bit of a mystery to me why these properties did not sell as they are located extremely well and are very attractive floor plans. It is my opinion that they would be phenomenal rentals that would bring $2,350/mo. per side for a total of $4,700/mo of gross income.

Originally these town homes were listed pre-construction for $550,000 each in the summer of 2006. The builder began the properties and by mid 2007 and the price was dropped to $525,000. Since that point, the bank took the property back and finished the remaining work that had to be finished. In our opinion, this property is currently worth a total of $900,000 ($450,000 each side) and should be able to be purchased from the bank for less with a clean offer.

Nashville Mortgage Rates Rise Slightly

2008-04-21T18:34:00.000-05:00

30 year fixed interest mortgage rates currently sit at 5.88%, and some industry analysts say they are unlikely to fall any further for the rest of the year. Interest on 30-year fixed loans is only down a quarter of a point, as the credit markets have cut the link between it and yields on 10-year Treasuries; and while skittish investors have moved to Treasuries to trim the yields, mortgage lenders have not eased lending standards.

Nashville mortgage rates are likely to close 2008 at about 6% as investors in bonds focus on rising inflation and drive interest rates higher. Long-term rates will also increase due to the additional supply of Treasuries as Congress borrows to raise money for the growing federal budget deficit. The rise of inflation is a blow to our 5.5% rate prediction by June of this year, we are still not certain that inflation may ease this summer.

Foreclosure Estate Home in Brentwood, TN - Hampton Reserve

2008-04-18T16:31:00.005-05:00

A local bank has taken back a $1+ million dollar home in the Hampton Reserve neighborhood in Brentwood, TN. Brentwood is one of the most affluent areas in Tennessee and is located in Williamson County (the top ranked county in Tennessee for schools, income, quality of life, etc.). Brentwood is located 11 miles due south of Nashville and is mostly a pillow community that only features commercial development of consequence in the Maryland Farms area.

The home is a 6 bed, 4.5 bath, 4 car garage 6,921 square foot estate property that was originally sold for $1,345,000 in April of 2007. At this point, the bank is ready to move it off the books and may accept a much lower offer. We can speak individually about that number, but I believe that a clean offer with a quick close will range between $875-900k. We will need to submit written offers to the bank.

Hampton Reserve currently has 17 homes on the market ranging in price from $1.125 mil to $2.099 mil. There has only been 1 closing in Hampton Reserve in 2008 to date.

*Pictures are from before it was sold to April 2007 buyer:

Eakin Partners Begin Site Work on Gulch Offices

2008-04-18T15:34:00.002-05:00

I recently drove by the corner of 12th Avenue South and Demonbreun Street in the Gulch and noticed that the old tire repair and replacement building was in the process of being cleared. I had not heard anything about this project since early to mid 2007, but it appears that Eakin is going to be building its twin office tower concept or another office concept. This property was expected to be a 16-20 story tower and would impressively change the landscape and entrance to the Gulch which lacks any office space of consequence.

The Gulch is most notably known for its residential and condo new construction projects. Currently the Icon, the Velocity, and the Terrazzo are all under construction and will deliver almost 1,000 condos between the summer of 2008 and the end of 2009. It is our belief that the Gulch will become the premier downtown residential area of Nashville by 2010 if construction in Sobro is further delayed.

New Proposed Hotel for Downtown Nashville

2008-04-17T21:35:00.002-05:00

From the Nashville City Paper Today:

"Denver-based Sage Hospitality today unveiled the new design for the proposed hotel along Lower Broadway after having filed with the Metro Planning Commission an amendment to the zoning approved for the project last year.

Sage started the process with Metro Council a month ago but had no images of the redesign until today.

Now dubbed Broadway Hotel, the project is shorter than originally approved and doesn’t contain condominiums. The proposed number of rooms increases from 375 to 457.

Earl Swensson Associates and Hawkins Partners handled the redesign and made it more friendly to the historic facades along Broadway.

The planning commission takes up the amendment on April 24. Council has the amendment on the public hearing meeting for May 6 and could be approved at the next meeting in May.

The hotel flag may or may not be Westin. But the developer says the hotel would be four-star quality. Despite the tight credit markets, Sage is confident the money can be obtained to build the project.

A major positive is Nashville’s hotel market in general continues to get stronger occupancy and higher rates, particularly downtown.

Sage along with The Barber Group of Arkansas battled hard to get the special-plan zoning. Historic preservationists opposed the project because of its size and possible negative impact on Lower Broad’s historic character. Metro Planning Director Rick Bernhardt thought it too large for the street as well."

This project is not connected to the new Nashville convention center, but is certainly connected to the expected demand. In my opinion, Nashville lacks a good selection of 4 star hotel options and could absorb another 2-3 luxury brand hotels.

Leipers Fork Estate Home Foreclosures

2008-04-16T08:38:00.001-05:00

Recently a local bank has had to take back two $1+ million estate homes in the Leipers Fork area of Franklin, TN 37064. For those of you not familiar with Leipers Fork, it is best described as a sleepy estate home town with rolling grassy hills, lazy streams, and the town Sherriff with a bubble gum machine on the roof of his car. It is a wealthy area full of country music stars and their equestrian facilities, but it’s real appeal is that Leiper’s Fork is really just a part of Franklin and no more than 25 miles from downtown Nashville.

The two bank owned homes are each brand new construction, they both sit on at least 5 acres, and have at least 6,500 square feet. The smaller house is priced at $1.25 million and the larger is $1.35 million. The bank is not in too big of a hurry to dump these homes at the moment, but that will probably change as summer arrives. It is my guess that these homes will eventually be bought at a significant discount at that time.

Why the secrecy? Why don’t you just give the address and post the pictures of the homes? A lot of people read this blog and the bank has asked me to discretely find a buyer for these two homes, out of respect for their wishes, I simply cannot. If you always wanted to own a country estate and would like for me to send you all of the homes’ information, just shoot me an email or call 615-945-7123 and ask for Grant Hammond.

Nashville Mortgage Rates Hold Steady

2008-04-15T08:26:00.007-05:00

The average interest on the benchmark mortgage rate held below the 6% threshold for the fourth consecutive week as 30-year loans remained at 5.88% this week, according to Freddie Mac.

"Once again, mortgage rates held relatively steady this week amid release of subdued economic data," said Freddie Mac chief economist Frank Nothaft, who cited a government report on the number of jobs eliminated by businesses last month. There was a slight downward movement involving the other mortgage rates as 15-year, fixed loans held steady at 5.42%, five-year adjustable rate mortgages fell 0.03% to 5.56%, and one-year ARMs declined 0.01% to 5.18%.

The April Fed meeting is rapidly approaching and again, we expect a quarter point drop in the discount rate which will lead to lower mortgage rates in May. More good news is that the Nashville housing market has growth each of the first four months of 2008. Pending home sales are up and "stale" inventory has decreased. Nashville is no where near its record 2007 numbers, but the market has certainly stabilized.

Property Management for The Encore Condos

2008-04-13T18:06:00.003-05:00

I just wanted to remind everyone that I have negotiated a bulk management discount with Summit Property Management to manage our group’s condos at the Encore. Summit will be charging us 8% of gross monthly rent and a $35 account management fee. Please call or email Adriana Coronado with Summit Property Management to confirm your interest in leasing: 615-732-9224 Adriana@SummitNashville.com

Summit offers you many services that other property managers do not:
- Online rent pay
- Online maintenance requests
- Corporate rental management
- Auto draft
- Auto bank deposit
- Annual tax preparation for rental property

Summit Property Management also has a $30,000 website coming online at the end of April that will be the gold standard for all property management websites in the United States…I should know…I helped build it! Simply put, it will drive hundreds of tenants to your property creating more renters than rental property. Be sure to check it out whenever you can: Summit Nashville

Financing the Encore Condos for Self-Employed Buyers

2008-04-12T18:33:00.004-05:00

For self-employed borrowers, SunTrust has an option that will help meet the need to obtain financing without having to go full documentation in The Encore. I would like to introduce the No Income Verification option. Below are some of the benefits and features of this product:

- Eliminates verification of income
- Shorter processing time

This product is targeted to SELF-EMPLOYED BORROWERS ONLY. The definition of a self-employed borrower is someone who receives 50% of his or her income from commission. Certain restrictions apply to this product. For a primary residence or second home, a minimum of a 720 credit score is required with a 10% down payment. For investment properties, a minimum of 20% down is required with the same 720 credit score requirement.

The immediate downside is that the risk is much higher for the Bank versus a full-documentation loan. The rate goes up with the risk; therefore the rate will be higher. The upside is that we have negotiated a 3% closing cost credit for our clients who close at the new earlier closing date. Buyers can use that 3% for closing costs, origination fees, discount points, etc… My suggestion is for self employed buyers to buy the rate down a couple of points with the money that the developer is giving them to end up with a conventional interest rate. EITHER WAY IT GOES, YOU WIN…

This is a huge opportunity to act quickly on this offer that the developer is offering. If you have any questions or concerns, please don’t hesitate to give me a call.

Travis Smith, USMC
Mortgage Loan Consultant

SunTrust Mortgage
615.309.4899 office
615.498.3970 cell

Apply online and save time at:
www.suntrustmortgage.com/tosmith

Philosophically, Where is the Nashville Market?

2008-04-11T21:13:00.000-05:00

There is no doubt that the Nashville real estate market has slowed, but it is not for the same reasons as many other major American markets. Nashville is one of the few markets still experiencing growth in the big three housing affordability factors: Job growth, wage growth, and population growth. So what is holding the Nashville market back? There is literal a standoff between home buyers and home sellers. And what has caused this standoff? It is lethal combination of the economy, tightening lending criteria, and the national media’s unrelenting over reporting and sensationalizing of bad real estate news. It is not a result of buyers vacating the market, buyers’ inability to afford the market, or buyers’ inability to obtain financing.

According to the Downtown Partnership, Nashville residents still need over 7,000 homes, townhomes, and condos in downtown to meet the current demand and that number is calculated after the Encore, Icon, and Rhythm deliver their 850 units in 2008. Reading and writing these statistics makes me feel very strange…especially since there is such a tangible standoff between buyers and sellers until I begin to rationalize from a buyer’s prospective. Buyers have been convinced by national publications that now is the time to low ball poor sellers in order to get the deal of a lifetime, but what many vultures fail to take into account is that in most cases they are sellers too. And as a seller, they are not willing to accept the same low ball offers that they themselves are making or are hoping to make.

The truth is that some sellers are willing to accept low ball offers, but those are the same sellers that are in true financial trouble and would have been regardless of the economy, lending guidelines, or media. These are the same 4% of Americans who are foreclosed on every year and the same people who live beyond their means no matter their income or circumstance. What about the rest of the sellers? They are just like you and I. They are not in financial trouble, they don’t have to sell, and they are probably not going to accept a low ball offer, but they are willing to take less for their homes than they were just one year ago. So what is the answer? The answer is that our market will return to normal much faster than the rest of the country whose markets are negative growth. When will that happen? As soon as people realize and accept that buying and selling at a discount in Nashville is better than continuing this standoff. Nashville is not Las Vegas or Phoenix. Our market never increased more than 15% in a year. Buyers never offered $50,000 more than asking price just to winning a bidding war. Nashville is a stable, growth oriented market whose fundamentals are strong, whose mortgage rates are low, and whose future is bright.

Fixed Mortgage Rates Rise Slightly

2008-04-07T19:54:00.000-05:00

National average mortgage borrowing costs were up slightly for the week, reports Freddie Mac. According to the company's figures, interest on 30-year fixed loans bumped up to 5.88% from 5.85% a week ago; while 15-year fixed loans rose to 5.42% from 5.34%. However, adjustable-rate products moved in the opposite direction with the one-year ARM dipping to 5.19% from 5.24% and the five-year ARM sliding to 5.59% from 5.67%.

The Fed is meeting at the end of the month to discuss the discount rate and it is widely believed that they will lower that rate a quarter point to 2.00%. This drop should proliferate through the institutional systems by the end of May leading to much lower rates this Summer. If you are a seasoned real estate investor, you should begin making your moves now before the rest of the country wakes up.

Encore Closing and Leasing FAQs

2008-04-04T16:32:00.000-05:00

I spoke with Ashley Dugger at the sales center today to ask her a few questions regarding Encore closings, leasing, etc and here are the answers:

Q: Will the developer allow us to move our closing date back to our original contracted closing date?
A: If the buyer is having trouble obtaining financing they need to fax or mail a signed letter explaining the trouble they are experiencing and the developer will work with each buyer on a case by case basis.

Q: Will the developer allow a buyer who cannot qualify for financing out of the contract?
A: No, there is no case in which financing lets you out of your contract. You will need to make application with a developer approved lender (SunTrust) and if you do not qualify they will send that information to the developer. If you do not qualify you will need to look for co-signers or replacement buyers (I am looking for replacement buyers as we speak).

Q: If I exhaust all of my available financing options is there a case where I get to walk away from my deposit and condo?
A: No, we have a responsibility to our investors and creditors to close all of the condos that have been contracted in order to pay back our construction costs.

Q: Can we obtain leasing status when we close?
A: No, you must obtain leasing status prior to going to the closing table (different from Viridian). Those who do close without leasing status will have to wait 6 months before applying for leasing status.

Q: Are there any exceptions to this leasing status rule?
A: A buyer can apply for a hardship exception that would allow for instant leasing status in few cases.

Q: How do I obtain leasing status?
A: You contact Stephanie or Ashley at Encore and arrange to deposit an additional 5% to obtain leasing status. As of today there are only 32 permits left out of 70.

Contact Information

Ashley Dugger can be reached at the sales center M-Sat 615-324-3838 or via email: ADugger@novaregroup.com

SunTrust can be reached via Travis Smith anytime 615-498-3970 or via email: Travis.O.Smith@SunTrust.com

Click here to see more pictures of the finished Encore Condos

Nashville Mortgage Rates Lower, Home Sales Up

2008-04-01T09:19:00.002-05:00

Freddie Mac's Primary Mortgage Market Survey showed the 30-year fixed-rate mortgage (FRM) averaging 5.85% with an average 0.4 point for the week ending March 27, 2008, down from the prior week when it averaged 5.87%. Last year at this time, the 30-year FRM averaged 6.16%.

The 15-year FRM averaged 5.34% in the latest report, with an average 0.4 point, up from the previous week when it averaged 5.27%. A year ago at this time, the 15-year FRM averaged 5.86%.

"Long-term mortgage rates were relatively unchanged in the past week as the latest economic indicators came in much as expected," said Frank Nothaft, Freddie Mac vice president and chief economist. "On the housing front, house prices keep declining across the nation. Lower prices improve affordability and the National Association of Realtors reported that its home affordability index was at the highest level in nearly five years, contributing to a pickup in existing home sales in February."

Nashville Makes News as Affordable Market

2008-03-30T14:14:00.000-05:00

A newly-released study by Bizjournals.com ranked the 50 largest metropolitan areas in the U.S. as to housing affordability and Nashville ranked 16th! The study looked at median household income per month and the median total housing payment per month (for each of the 50 markets) to compute total housing payment as a percentage of household income. This showed 24% of income spent on housing in Nashville, TN.

Mortgage Rates Drop Below 6%, Again

2008-03-24T21:32:00.001-05:00

According to Freddie Mac's data, national average mortgage rates dropped back below 6% after spending more than a month above that threshold. Thanks to the Federal Reserve's aggressive moves to insulate the U.S. economy by slashing borrowing costs, 30-year fixed home loans averaged 5.87% for the week ending 3/20/08. That compares to 6.13% a week earlier and represents the first time since mid-February that the benchmark interest rate has been less than 6%.

"Slowing consumer spending and weak employment conditions are among the concerns behind the Fed's decision to lower the target federal funds rate," said Freddie Mac chief economist Frank Nothaft. However, the Nashville housing market should get a boost from this drop.

The Best Places To Buy Foreclosed Property

2008-03-24T14:41:00.001-05:00

Last week, Forbes.com published a news story identifying the 10 "Best Places To Buy Foreclosed Homes." The nation's 100 largest metro areas were studied in the process of selecting the Top 10. Basing their analysis on recent data from RealtyTrac, the report identifies markets where properties in foreclosure may, in fact, be a good investment because the markets in those areas are stabilizing and "foreclosures aren't symptomatic of local economic ruin."

In other words, making the list is great news for those who live and work in these markets and two Tennessee cities made the Top 10 List:

1. Charlotte, NC
2. Raleigh, NC
3. Nashville, TN
4. Oklahoma City, OK
5. San Antonio, TX
6. Albuquerque, NM
7. Knoxville, TN
8. Seattle, WA
9. Indianapolis, IN
10. Washington-Arlington-Alexandria

Investing in Nashville homes and maybe even condos is a savvy investment in a nationally depressed real estate market. With the stock markets in a free for all, why not purchase a stable investment in a growing and dynamic city?

The Icon In The Gulch - Nashville, TN

2008-03-16T10:53:00.002-05:00

There is a new massive 400+ unit condo building rising from the ground in the area of Nashville know as "The Gulch" that might become the symbol of national real estate investment greed. The Icon was pre-sold almost 2 years ago in a cloud of heavy speculation and an atmosphere of such frenzy that I felt like a New York Stock Exchange floor trader that day. Literally hundreds of investors and Realtors crammed themselves into the relatively small sales center on 11th Avenue South in Nashville and jockeyed for the best condos. At one point the Icon representatives would simply yell out a condo's unit number and the first person to yell back or physically grab the contract from the representative was the lucky buyer. Condo prices were shooting up every 30 minutes and the fever pitch lasted until the last condo was sold in the tower portion of the building.

Fast forward 2 years and now we are facing a national recession (maybe), oil prices over $110/barrel which will surely lead to $4.00/gallon at the pump, and domestic real estate investors have fled every market in the United Stated. So here is the question: When the Icon begins to close condos in the next 3 months, will the buyers buy or will they flee? The answer to that question is more complicated than usual for the following reasons:

•1) The condo deposits were unusually low; only $5,000 for a 1 bedroom and only $7,500 for a 2 bedroom
•2) The concentration of out-of-state investors was unusually high - some estimate about 25%
•3) The developer has already sent out letters that slyly mention "specific performance"
•4) This is the largest condo project in Nashville's young history and it delivers at the worst possible time

Many of you who are reading this are astounded by the super low condo deposits, many condo investors in the United States are used to a minimum of 10% deposits. In this case, the $5,000 deposit was equivalent to around 2%...yes 2%! So if you were a half-way savvy investor who did not see the economic downtown coming, you would have jumped this thing like a mugger on a moonless night...and that is what happened. Before many of you jump to the conclusion that this is a paper thin development with no redeeming factors, let me say this: The Icon is a very, very cool 22-story building located in a very cool area of Nashville called The Gulch. Many of the condos have panoramic views of the city, the finishes are very modern, and the amenities will be counted among the best in the city when built. The building itself is not the problem, it's the timing.

The reason I mentioned specific performance in the "unusual" category above is that Nashville has never heard of a developer threaten to sue their buyers until now. By sending out a welcome letter that included those simple words, they put all of their buyers on notice that Tennessee is a specific performance state and that they have the law as a tool to force you to close. Will they have to use it? Well, that is the real questions isn't it?

Some solutions: The developer is going to offer a 1 year free property management and leasing service to all of those who do complete their purchase. This program will be limited to some undefined number of participants, but it definitive helps. The only other real solutions are out of the developer' hands. Mortgage interest rates need to come down and consumer confidence needs to stabilize.

Let me add one gripe to this story. Wells Fargo is the only lender who has condo approval for this project and hence is the preferred lender on this building. Wells Fargo is a good lender, but the guys in charge here have a long history of passing the buck, meaning they will offer you closing discounts and incentives, but then raise the rate on you so they can make that money back. There are not giving you market rates. So if you look at the loan over a period of time, you didn't save anything. I would like to see a second or even a third lender obtain project approval in order to create an atmosphere of true lending competition and not monopoly. In order for that to happen a couple of lenders have to step up and absorb the cost of obtaining project approval and the developer has to step up and remove their head from the sand...one lender is not the best solution in a down market! Think of it from the buyer's perspective: The buyer is going to be closing on an investment they really don't want right now because of the economy and now they are force feed a loan that is not quote at market rates...come on, even I want to slap someone. I would feel much better talking with 2 or 3 lenders to see who really wanted to give me the best deal and that would make me feel a little better about having to buy an investment that I really don't want.

In conclusion, I think that The Icon in the Gulch is a really great condo building that is located in a really great area. What I don't like is the line that is being drawn in the sand. I certainly understand that the economy has a lot to do with what is happening, but I feel that there are better solutions and ways to get to those solutions than what I currently see being done. 2-3 years from now we will all look back on this and laugh, but right now it feels a little like us versus them.

30-Year Mortgage Rates On The Decline

2008-03-12T13:49:00.001-05:00

Freddie Mac says the 30-year fixed mortgage rate fell to 6.03% during the week ended March 6 from 6.24% the prior week. Interest on 15-year, fixed-rate mortgages also declined, falling to 5.47% from 5.72% over the same period. The five-year adjustable mortgage rate dipped to 5.34% from 5.43%, while the one-year ARM dropped to 4.94% from 5.11%. Freddie Mac chief economist Frank Nothaft attributed the decrease in mortgage rates to reports of weakness in the job market, manufacturing sector, and consumer confidence.

HUD Releases New FHA, Conforming Loan Limits - Home Sales Stable

2008-03-10T16:36:00.002-05:00

Last week, HUD published new FHA and conforming loan limits, based on median home prices as mandated by the Economic Stimulus Act signed by President Bush in February. The new loan limits for FHA, Fannie Mae, and Freddie Mac are now calculated at 125% of the HUD published median prices, with a floor of $271,050 and $417,000, respectively, not to exceed $729,750.

The Nashville MSA (Davidson, Williamson and five surrounding counties) now has a loan limit for single-family homes of $432,500 for FHA, Fannie Mae, and Freddie Mac. Most other areas in Tennessee have a FHA loan limit of $271,050 for single family homes.

The National Association of Realtors expects the impact on the housing market to be significant because of the infusion of capital into the mortgage market, which should result in lower interest rates across the board.

The volume of existing-home sales is also expected to remain stable through late spring, with a gradual recovery during the second half of the year as the mortgage situation improves in high-cost areas, according to the latest forecast by NAR.

Lawrence Yun, NAR chief economist, says many buyers have been waiting for these higher mortgage loan limits. "The higher loan limits for both FHA and conventional loans will increase consumer choice and provide greater access to lower interest rate mortgages in high-cost regions," he says. "Therefore, a notable rise in home sales can be anticipated in the second half of the year."

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in January, held at a stable level of 85.9, unchanged from December, but was 19.6% below the January 2007 reading of 106.8.

"This additional sign of a stabilizing market is encouraging, and our members are telling us there's been a pickup in shopping activity," Yun says. "Our hope is that the increased traffic of buyers looking at homes will translate into more contract offers."

Nashville February Home Prices and Sales Data

2008-03-08T13:58:00.003-06:00

There were 1,892 residential closings in February 2008 as opposed to 2,575 in February 2007. Of those 1,892 closings, 1,488 were single family homes, 256 were condos, 121 were land, and 27 were multifamily.

As of the end of February, there were a total of 22,473 properties on the market as opposed to 17,824 in 2007. Of those 22,473 properties, 14,344 were single family homes, 5,375 were land, 2,374 were condos, and 380 were multifamily.

Inventory has increased fairly significantly due to the sub prime financial mess and there are many meaningful choices for buyers. More importantly, there are very few foreclosures, pointing towards a healthy market that has backed off of 2007 highs, the second best year in Nashville real estate history.