Buying a home in Nashville Tennessee

It would seem that with all the negative reports in the media that real estate sales are set to hit record lows, builders and developers will be going out of business and 9 out of 10 homeowners will be facing foreclosure in the next 6 months!

I have to say that in Nashville we really haven't seen any decline in the demand for information about the real estate and homes for sale. Inquiries are actually up around 30% from this time last year for our team, The Ashton Real Estate Group.

What is noticeable though is the attitude and state of mind of the buyer. The media helps to build up peoples expectations and preconceived ideas so all the talk of the mortgage sub prime crisis, the possibility of a $8 gallon of gas, the possible government bail out of Fannie Mae and Freddie Mac, has the buyer looking, looking some more and then looking some more still.

All the delays and lack of confidence actually feeds in to the downward spiral of real estate values if it is left unchecked. For example, if a buyer that is currently renting is looking to buy in the 300-350,000 price range they will find they have lots of inventory to choose from. The down side of this is that the buyer knows that have the time to keep looking even when they have found a home they love. People cannot resist the temptation to just look a little longer just in case that dream home is just around the corner. For the seller though this sends out mixed signals. The buyers have provided all the buying signs, the great feedback, they love the home, the neighborhood etc but they still aren't buying. The home must be priced right otherwise the buyers would be giving back all sorts of negative feedback regarding thier expectations.

So, as the home is priced right, the marketing has done its job and they buyer is ready and able to buy so what’s the seller to think when that perfect buyer just doesn't make an offer? The realtor will have one answer for the seller...it's the price. If we can drop the price the home will become the most attractively priced in their price range and they will see the value and make an offer.

The downside to this is that the sellers will make the price reduction in hopes of attracting back the interested buyers but in doing so they send a signal out to the market that their home isn't selling and so they have had to reduce the list price to attract any buyers. Now the buyers that were interested in the home come back to the home but as this seller reduced their price so did all the other homes in the neighborhood in attempt to stay current and competitive in their pricing.

The buyers now will still make a low ball offer as they see that the sellers are serious enough to drop the price...therefore they must be motivated. When the home does sell the sales price sets a new comparative sales price and in doing so pushes the competitive list prices down even further.

So is the market driving down the sales price, the media or the realtor?

I think that it's a measure of all sorts of factors but desire to sell when the mindset is ready to move is a great motivating factor and some people will just be happy to sell and move on so that the everyday hassle of selling a home is behind them.

In the next few months I think we'll see more and more list price reductions and the buyers become more and more confident about making low ball offers and seeing other deals go through that really set the bar in terms of negotiating the sales price down.

Nashville Area Home Stats: Click HERE

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