The first-quarter Metrostudy data for the Nashville-Davidson-Murfreesboro-Franklin, Tennessee market shows steady new-home sales throughout the past year, rising prices, and decreasing supply. In 1Q13, 802 new-homes were closed compared to a slight spike to 962 in 1Q14, nearly a 20 percent increase. Although new-home closings fell in the first-quarter from 1,103 in 4Q13, sales in the market have been steadily rising year-over-year since 2008. An average of about 10,000 new and existing homes have been sold market-wide per quarter over the last 3 years.
The median price for both new and existing homes in the Nashville market is steadily climbing. Median price for new homes peaked in the first-quarter at $296,300 up from $267,300 in 1Q13, a 10.8 percent increase. The first-quarter median new-home price is also up from $287,000 in the fourth-quarter. The median price for existing homes, however, dropped slightly between the fourth and first quarter from $154,900 to $152,400, marking continued affordability for the entry-level existing homebuyer in the market. The median cost per square foot for existing homes in the Nashville market is still less than $100 per square foot and was just $92 in the first-quarter, and $124 per square foot for new-homes.
Housing and lot inventory in Nashville is slowly declining exemplifying growing new-home demand in the market. Inventory of Vacant Developed Lots fell from 11,147 to 10,819, a three percent decrease. Months supply of Vacant Developed Lots in has decreased significantly in the past year from 32.0 months in 1Q13 to 22.4 in 1Q14. Housing supply in the Nashville market is quite low and slowly declining with a drop from 7.2 months from 1Q13 to 6.9 months in 1Q14. Should demand in the market continue and homes maintain affordability, Nashville will likely continue to see steady home sales throughout the remainder of 2014.