Here's the Real Estate Trends I Forgot
After I sent yesterday’s email on the Top 5 Trends for Nashville Real Estate in 2016, I got several questions on this topic.
What do you think will happen to Nashville Rental Market [including VRBO/AirBNB] Trends in 2016?
That’s a great question that I did not cover (shame on me).
So, here are my best answers.
According to the site, Rentjungle.com, average rental rates in Nashville have climbed 46% in the last three years. This rate of increase is at record levels and cannot continue indefinitely. While, I still expect rates to increase in 2016, I expect the change to be more moderate. Earlier this year, there were more than 1800 apartment units under construction or in the pipeline. This increase in units will help to slow down the pace of increasing rates. Occupancy rates will continue to hover around 96%.
In 2015, Nashville started requiring permits for short term rentals like VRBO and AirBNB. This new law caps the number of short term rental units in each census tract to 3% of the total number of homes. Most people do not know these permits are required. These permits do not covey with a home sale and you can’t rent for a year if you get caught without one. This (and a few other factors) should slow down the massive number of short term rentals that popped up in 2015. I expect most new units in 2016 will be located in single family homes located near the downtown core.
Let me know if I missed anything else in my Trends Report in the comments below!
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