Demand for Nashville condominiums is strong, especially in the downtown core. But what should potential buyers know about getting into the market?
The top questions revolve around price and location, Parks | Compass broker Sydney McCann said. In the downtown Nashville area, median home prices over the past 12 months are around $660,000, according to data from the Greater Nashville Realtors.
But different submarkets within that area provide different neighborhood feel, and location can make a big difference when it comes to closing a deal.
In addition, homeowners’ association fees come along with condo ownership, and they can rack up.
So, do condos make a good investment?
Here’s what Nashville Realtors had to say about getting into the downtown condo market.
A good investment? The truth about condo appreciation
According to Jack Gaughan of the Greater Nashville Realtors, condos typically don’t appreciate in value as quickly as single-family homes, and their value depends on several factors that are sometimes out of an individual owner’s control.
For example, amenities may need upgrading in older condominium buildings, but it takes a large investment and the entire HOA to agree to make those changes, which ultimately impact the value of each unit.
Overall, condo ownership is a lifestyle choice — not always a strategic investment, Gaughan said.
“In general, the demand for a condo is always going to be lower because there are fewer people who want that lifestyle,” he said. “Going into a condo thinking it’s going to be a prime investment probably isn’t the right mindset.”
But because condos typically have a more accessible entry-level price than single-family homes, it can be a way for buyers to get into the real-estate market instead of sitting on the sidelines.
For first-timers: Consider your options
McCann always encourages her clients to consider all the options in the market before coming to a final decision. In downtown Nashville, that means buyers must consider at least a dozen high-rise condo buildings, including newcomer Pullman Gulch Union.
Other examples of condo towers include the Viridian, 505 Church, Twelve Twelve, Icon and Broadwest, among others. Each of these offers a slightly different neighborhood, amenities and price points.
“Typically, one will resonate with a buyer over the other,” McCann said. “We always encourage buyers to take a look at the condo resale market and compare what they can get there versus what they can get in a new building.”
In new buildings, amenity packages are top-of-the-line and include trendy features like pickleball courts and remote-work areas. And in older buildings, the design of common areas may be outdated.
HOA fees, building management, neighbors
Owning a condominium comes with paying HOA fees, and those are constantly climbing in Nashville. The fees are determined by the HOA board and usually correlate with unit square footage.
For owners, that’s an additional expense that requires consideration.
Additionally, Gaughan said, living in a condo building means living with other homeowners on all sides. Potential buyers should pay attention to how the building is managed and whether there are maintenance issues to consider.
“Generally, people underestimate what it’s like to live with homeowners all around you,” he said. “Everyone has different ideas about how the building should be run.”
Love your view? Find out if it will stay that way
Nashville’s skyline is changing constantly. If a condo unit is appealing because of the view, potential buyers should make sure that won’t be taken away.
The upside of buying in a more established neighborhood is there are fewer empty lots poised for redevelopment.
“What is happening around you?” Gaughan asks his clients. “Construction? New buildings coming to obstruct your view? That little parking lot next door doesn’t have to be a parking lot.”
Reporter Molly Davis covers growth and development in Nashville. Reach her at [email protected].
This article originally appeared on Nashville Tennessean: Nashville’s condo market: Investment, appreciation, HOA, hidden fees
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