Did you see the viral post about the Nashville short term rental market? If you didn’t catch it, there was an article posted that stated that the Nashville STR market was down over 40%. Unfortunately, in this 24-hour news cycle age, the negative headlines trend better and get more views. So, while there were numerous articles debunking the false claims this person made, those articles didn’t get the same visibility boost by the algorithms. With the current real estate market trends, you may still be asking if short term rentals are still a good investment or has Nashville capped out? The fact is, the Nashville market is still performing ahead of other similar markets–and that goes double for investment properties.
In fact, ULI’s annual Emerging Trends in Real Estate Report came out recently, and it showed that Nashville was named Top Market To Watch for the 3rd year in a row. That is amazing news for anyone investing in Nashville.
Source: ULI Emerging Trends in Real Estate United States and Canada 2024
When speaking to property managers and short term rental owners in Nashville, the overall consensus is that bookings are up for 2024. Last year we saw a lot of international travel that wasn’t happening the previous few years due to covid. These are not trips that people take every year, so domestic travel is expected to be higher in 2024–and that is what we are already seeing with bookings here in Nashville. When traveling in the U.S., people are still choosing to come to Nashville. The city has done a great job of creating a real tourist attraction in downtown and people want to come experience the special sauce that is Music City.
Interest rates might be slowing the market down, but the outlook in Nashville is still very strong. The two strongest indicators of that strength are: Amazon and Oracle. With those two powerhouses investing highly in making Nashville their second home, there is really no argument to make against Nashville’s trajectory for the next 10 years. Industry is here and more is on its way.
So why does it seem like no one is buying right now? Whenever there is a shift in the market, it’s going to knock out the green investor. Experienced investors that I work with are quietly buying properties and looking for deals. Everyone knows that, logically, you are supposed to buy when the market is down, but in practice, so few have the stomach to follow the logic. When the market is going crazy and everyone else is buying, that is when the experienced investor knows it’s time to SELL. That market is past us now, and right now is the time to BUY–if you can afford it. I would never recommend someone make a purchase if it is outside of a client’s means.
Are there times in this market to sell? Absolutely. If your target buyer is an investor, now is a great time to sell that fixer-upper or property that has gained you the equity you need to turn that into some more investment property purchases. Talk to an experienced Realtor if you are wondering about your own property.
If you’re ready to jump into investing, now is a great time to make that move. Here are the first 4 questions I ask my investors who ask me to find them investment property:
1. What is the return you’re looking for?
2. What is your budget?
3. What is your timeline?
4. How are you financing?
2. What is your budget?
3. What is your timeline?
4. How are you financing?
There are some amazing short term rental properties on the market in Nashville today that have the potential to bring substantial returns to the person who grabs them up. Last year, these properties were hardly on the market for 24 hours before they were under contract. Now, you see incentives being offered by sellers that are going to make your financial return projections look even better than they would have if you purchased last year. Purchasing when no one else is, is the right time to purchase. Look at the buyers who purchased in 2008/2009–now it’s your turn to purchase in a down market and look like a genius in a few years.
Look around and see what the experienced investors are doing–they are buying. If you’ve been waiting to get into the short term rental market in Nashville because it’s been so competitive, now is the time to get in and ramp up for the increased tourism traffic that is being projected for 2024.