When Madeline Santschi and Wil Moore started house hunting last year, they wanted to buy in Franklin. Initially, the couple said they weren’t ready to compromise, so they rented an apartment together while they looked for a house.
After constantly scouring websites for available homes in their price range, they began to consider areas like Nolensville or the Maury County side of Spring Hill as more realistic options.
“We were at a point where we were ready to buy a house together, but there was nothing on the market for us,” Santschi said. “We wanted to do a new build so we wouldn’t have to bid. We knew we wouldn’t be able to outbid someone because we didn’t have all the money.
Moore added that they also didn’t want to have to pay a high price for a home that would also require a lot of time and money for upgrades and repairs after the sale.
But they couldn’t find anything in their price range in Franklin that matched those parameters, which is a common problem for first-time home buyers in Middle Tennessee.
Despite real estate prices escalating to never-before-seen levels in many prime Central Tennessee locations, there are still more affordable options if you’re willing to expand your location parameters.
Jamison Durham is a management broker at Blackwell Realty and says there’s a real estate industry term called “drive until you qualify” which means some buyers have to expand their geographic search area to include homes they can afford.
“I tell my clients to imagine a triangle with three points,” Durham said. “One point is the price; one is location and the other is home. We can choose two. If you want a big house at a great price, we have to be flexible on location. If you want an amazing location at a great price, we’re looking for a top fixer. If you want a house and a location, we’ll pay a premium for it.
Get off the beaten track
Steve Jolly, broker at Benchmark Realty and president of Greater Nashville Realtors, advises first-time buyers that if finding a home you can afford in East Nashville isn’t happening, consider going a few more miles. north to Madison. If looking for a home in Murfreesboro doesn’t offer the right options, perhaps Shelbyville is worth exploring.
“There aren’t many areas left in Davidson County, but the further you get from downtown, the lower the prices tend to be,” Jolly said. “For a single family home in Davidson County, it’s nearly impossible to find anything under $400,000.”
It is basically the same scenario for surrounding counties such as Williamson, Sumner, Wilson, Rutherford and Maury.
“If you want to be in Rutherford County, Murfreesboro is the most competitive market I’ve been to in the last 18 months,” Durham said. “If you’re looking there, I’d say go to Tullahoma. Look at Shelbyville. You can still get a deal there.
But Moore and Santschi offer proof that it can be done. They are under contract for a new home in the Harvest Point subdivision in Spring Hill with an expected April closing date. They got more house than they had originally hoped for and stayed within their budget of $350,000 to $375,000.
Their advice to their colleagues for first-time buyers? Look at new constructions and expand your search geographically.
“The more you get for your money, the further you go,” Moore said. “The location is going to add 10 minutes to my commute, but it was either an extra 10 minutes ride or keep renting.”
Advice for first-time home buyers
Steve Jolly, broker at Benchmark Realty and president of Greater Nashville Realtors®, offers first-time homebuyers some solid advice as they navigate this unprecedented real estate market. In addition to considering outlying areas for more moderately priced homes, he recommends:
First-time home buyers can prepare for a stronger offer by getting pre-approved from a lender. Jolly says not all pre-approval letters are the same, but a trusted realtor can guide a buyer through the proper steps to a solid pre-approval. “Not all pre-approval letters go through the entire underwriting process at first,” Jolly said. “You want as much as possible to be done up front so that there are no surprises for the buyer or the seller.”
“Your agent should set you up on automatic notification, so you’ll be notified as soon as an ad hits the market,” he said. Then, buyers should be ready to check out a new ad immediately. “You can’t wait until the weekend to go visit a house, because it will be gone by then.”
Write a good offer
Jolly advises when viewing a home, to gather as much information as possible to help strengthen your offer. For example, is the HVAC unit new or on its final stage? “The offer will be very different if the HVAC is new or needs to be replaced. You can only get one chance to get an offer, so you need to make sure it’s a good one. »
Choose a trusted agent
A good agent, says Jolly, will talk to a home’s listing agent to see what the seller is looking for in a good offer. They should find out what pain the salesperson has that needs to be resolved and figure out how to resolve it. “You can gain an advantage over other people in the market by being willing to do things that other potential buyers won’t.”
Have some money aside
If a home is listed at $400,000 and appraised at $400,000, but a buyer offers $425,000, the buyer will have to pay that extra $25,000 out of pocket. “It’s common for homes to sell for above their list price,” Jolly said. “You may need to put money aside to cover a valuation gap if the house is not appraised.”
Consider new construction
Seeking to buy a new build removes the potential bidding war and having to arbitrarily bid the asking price to clinch the sale. “With most builders, you’re on a waiting list, so when it’s your turn, you say yes or you say no,” Jolly said. First-time home buyers Madeline Santschi and Wil Moore knew they couldn’t afford to engage in a bidding war or make a cash offer, so they opted for new construction.
Enter the market
Jolly advises that it’s best to buy a house that may be smaller than you might want or even consider a townhouse – just to get into the real estate market and out of the rental market. He says it pays to participate in the appreciation the Nashville market is currently experiencing and is expected to have in the future. “The market is up almost 24% last year, so if you bought a $400,000 house, you’ve made almost $100,000 in equity. That’s $100,000 that you can use as a down payment on the next house. When you sell, you are much further ahead than the one who rented.
Central Tennessee Price Levels
Davidson County – Median list price of $400,000
If you want to live in: East Nashville
Consider: Old Hickory or Madison
Williamson County – Median list price of $450,000
If you want to live in: Franklin
Consider: Fairview or Columbia
Sumner County – Median list price of $349,900
If you want to live in: Hendersonville
Consider: Gallatin, Castalian Springs or the White House
Wilson County – Median list price of $341,820
If you want to live in: Mt. Juliet
Rutherford County – Median list price of $382,400
If you want to live in: Murfreesboro
Consider: Rockvale or Shelbyville
County of Maury – Median list price of $410,758
If you want to live in: Spring Hill
*Median list price data is from Realtracs MLS. These median list prices are the result of a search for active listings in each county that are 3-bedroom, 2-bathroom, approximately 1,500 square foot homes – a good representation of an entry-level home.