Nashville Bits and Pieces

[thenorthchannel]

I found this story on The Ringer.  It's a well written take on the battle over Airbnb in Nashville.

https://www.theringer.com/features/2017/11/21/16678002/airbnb-nashville

[nashwatcher]

I'm curious about the situation with affordable housing in Nashville. Do you all think our city's growth will start slowing down if we don't start building more affordable housing? How dramatically? Could we build lots of units at the end of light rail lines where land is less expensive?

[Nash_12South]

I don't see a slowdown due to affordable housing. I think as the new hotels (and 100s of rooms) start coming on-line, a lot of the air b&bs will start to be less appealing and will start becoming apartments again. I have good friends (in East Nashville) who built out over their garage with this in mind - short term rental now, long term later.

I think we will overbuild apartments, as we always seem to, and rents will come down - some. I also think that someone will start building apartments aimed at being affordable as the high end market gets saturated. The city will be forced to do more if they see potential business relocations questioning housing. Some of the older apartment complexes will have trouble competing with the newer and be forced to drop their rents.

Edited December 20, 2017 by Nash_12South

[PaulChinetti]

16 hours ago, thenorthchannel said:

I found this story on The Ringer.  It's a well written take on the battle over Airbnb in Nashville.

https://www.theringer.com/features/2017/11/21/16678002/airbnb-nashville

I skimmed the article because it's always the same, people don't want it in their neighborhood while they run an airbnb themselves. I understand all the points. Report the bad eggs that are loud just like you would report any loud neighbor, fine em whatever.

Why not include some numbers in their article, for the 2,322 residences available in the East Nashville district where you can get short term permits, there are 42 available for owner occupied buildings and another 42 for non-owner occupied buildings. 

Do they expect people just to not make money because they weren't the first 42 through the door. They are filling a gigantic need for affordable places to stay in this city.  It's not gonna solve itself until you can stay in Nashville for less than $400 bucks a night. 

The problem that is never gonna be solved is that fact that there is just no hotel you can rent that you can stay with a large group all together, that's always the draw of getting an airbnb over a hotel.

[smeagolsfree]

Lots of moving parts to the solution. I think that the hotel construction affecting the air BNB's is probably dead on. The owners seem to charge higher and higher prices  for their units, however there will always be a core group, like large families and groups that will continue to rent those units because they are not monitored during their stay. These groups tend to abuse the privileges they have and many would be kicked out of a hotel for some of the crap they do in these homes.

As far as affordable housing, I am not sure the Air BNB's opening back up to long term rentals will solve the problem, because many are in more established neighborhoods that can demand a higher rate.

Some of this will not be solve unless the economy takes a downward spiral and then owners would get what they could for a rental.

The overbuilding of apartments here is going to be temporary at best as they will fill up and more will be built. My hope is the rates will or already have topped out. 

Honestly, after looking at a number of units in the new buildings downtown, I would never rent one because they are way overpriced for the space you get. These buildings are being rented to a group that thinks it is hip to live downtown and these folks are younger for sure. I would be in the category of an older person that would downsize, but to downsize that much would drive me crazy as I need my space. This is me, but if you have money to waste, more power to ya.

I do agree that Metro has to do a lot more in making affordable housing available and more affordable. Workforce housing is one way, but there are many that can't afford that because they are living below the poverty level. Those folks are the ones that are being hurt the most right now. 

Many of the homes in the McKissack Park area, aka City Heights are rentals and the owners are now tearing them down and building what is being built everywhere else in town. This is sad as these folks have no place to go.

I can go all day on this issue, but I wanted to get m two cents in .

[Hey_Hey]

I don't think we'll see AirBNB collapse in Nashville. We may see prices trend down some as hotel prices trend down as well, but that I think we'll see stable numbers to slight AirBNB growth going forward.  AirBNB is, simply, a unique and better product than what traditional hotels can offer for many groups of people. While AirBNBs seem to be overrunning Nashville, in truth it is only a few neighborhoods in the core. The total AirBNB numbers are still relatively small compared to the total hotel market. There are somewhere around 3000-4000 AirBNB units in Nashville right now compared to ~42,000 hotel rooms in the MSA.  The hotel number will grow to 46-48,000 in the next 2-3 years, so we will likely see some softening of hotel and AirBNB prices, but I predict few AirBNBs will become long term rentals.  There are all sorts of 2BR AirBNB properties in the core bringing in $4000 per month in revenue. That compares to that same property being rented long-term for $2000/month.  The crazy thing is that when split two or three ways, it is still cheaper to rent an AirBNB in Nashville's core than it is to stay in a hotel in the core. The are also externalities (the city) that are limiting AirBNB supply as well which will keep prices higher than they would be in a less regulated market.  

In terms of housing and hotel costs, it's important to remember what comes first.  Unless a region is intentionally constraining supply (and with all the sprawl in Nashville we know that's not the case), housing costs are driven by demand. I'm reminded of the Yogi Berra quote in regards to a popular restaurant, "Nobody goes there anymore; it's too crowded," which is obviously contradictory. Similarly, the thought, "Nobody is moving to Nashville anymore; it's too expensive," is contradictory because the fact that it is expensive proves that demand (population growth) is strong.  If we see housing prices drop or stop growing for more than a quarter or two, that's the when we know that population growth has also stagnated. 

Nashville is getting more expensive, but so are all of our peer cities. In the last 10-15 years Nashville has essentially jumped into a new tier of city. In 2000 we were in the Louisville-Memphis-Birmingham-Jacksonville tier of cities.  In 2017 we find ourselves in the Charlotte-Austin-Denver-Portland-Indianapolis. While we are expensive compared to our old tier, compared to our new peer cities, Nashville is still relatively affordable.  

[markhollin]

The Metro Council on Tuesday approved Mayor Megan Barry's proposal to give Philips, a Netherlands-based health technology giant, $2.9 million in city incentives as part of the company's recent move to downtown Nashville that's expected to bring 815 jobs.  

http://www.tennessean.com/story/news/2017/12/19/nashville-council-approves-incentives-philips-advances-new-transparency-rules/966412001/

[ZestyEd]

With the MLS announcing Nashville as an expansion team today.  This is a great video about the creation of the Nashville Sports Counsel and their impact to the city of Nashville. 

  

[MLBrumby]

"Peak Millennial" 

http://time.com/5054046/millennials-cities/

Time magazine has an article about how Millennials increasingly are moving out of large cities. I only have anecdotal cases of people I know who are choosing smaller cities (or more likely suburbs of the identified large cities) because they are affordable. So many large cities now are simply too expensive for people to live. 

Hat tip to Zero Hedge. http://www.zerohedge.com/news/2017-12-17/exodus-starts-millennials-ditch-city-life

I wonder if retiring wealthy Baby Boomers will fill the alleged void of Millennials. Would they even choose to live in the same places? 

[MLBrumby]

On Nashville population: I found this site which aligns with the population estimates I've seen for 2016 (the latest). So I'm not challenging the info in this table, as I've seen it elsewhere. Granted, they're just estimates, but I'm curious as to why the perceived slowdown in y-o-y growth from estimated 10k per year up to '15, then the 6k in the next year, which from outward appearances was one of even greater growth than the previous 5 years. Anyone here have insight to this, either in support of, or disagreement with these estimates?  With the pattern from '10 to '15, wouldn't one reasonably expect another year of at least 10k, given the number of housing units permitted and job growth during the year '15-to-'16? 

http://worldpopulationreview.com/us-cities/nashville-population/

Year	Population	Growth	Growth Rate
2016	660,388	6,310	0.96%
2015	654,078	9,707	1.51%
2014	644,371	9,532	1.50%
2013	634,839	9,634	1.54%
2012	625,205	13,101	2.14%
2011	612,104	10,882	1.81%
2010	601,222	55,698	10.21%
2000	545,524	57,150	11.70%
1990	488,374	32,723	7.18%

According to CB Quick Facts, there were over 9566 housing permits issued in 2016. This also estimates county population last year at 684,000.  https://www.census.gov/quickfacts/fact/table/davidsoncountytennessee/PST045216 

FY '15 Permits - $2.4B

https://www.bizjournals.com/nashville/blog/real-estate/2015/07/another-nashville-record-2-437-788-885-worthof.html

FY '16 Permits - $3.6B

https://www.bizjournals.com/nashville/news/2016/07/05/nashville-hulk-smashes-construction-record-topping.html

FY '17 Permits - $3.5B

https://www.bizjournals.com/nashville/news/2017/07/07/the-new-nashville-when-3-5b-of-construction-isnt-a.html

 

Edited December 20, 2017 by MLBrumby

[Hey_Hey]

3 hours ago, MLBrumby said:

"Peak Millennial" 

http://time.com/5054046/millennials-cities/

Time magazine has an article about how Millennials increasingly are moving out of large cities. I only have anecdotal cases of people I know who are choosing smaller cities (or more likely suburbs of the identified large cities) because they are affordable. So many large cities now are simply too expensive for people to live. 

Cue the deluge of articles documenting how Gen Z is moving to the cities in droves while millennials head for the burbs.

[Pdt2f]

5 hours ago, MLBrumby said:

"Peak Millennial" 

http://time.com/5054046/millennials-cities/

Time magazine has an article about how Millennials increasingly are moving out of large cities. I only have anecdotal cases of people I know who are choosing smaller cities (or more likely suburbs of the identified large cities) because they are affordable. So many large cities now are simply too expensive for people to live. 

Hat tip to Zero Hedge. http://www.zerohedge.com/news/2017-12-17/exodus-starts-millennials-ditch-city-life

I wonder if retiring wealthy Baby Boomers will fill the alleged void of Millennials. Would they even choose to live in the same places? 

It wouldn’t surprise me, as millennials age and start families cities become unaffordable. Most new residential construction in urban areas (at least in Nashville) is luxury apartments. Having a 1 bedroom apartment downtown for $2000 a month makes sense for two medium-to-high earners, but when they start a family and see that 2-3 bedroom units in the same part of town go for $3500-5000, places like Hendersonville and Murfreesboro start to look more appealing. Plus you need more storage, maybe only 1 income if mom decides to stay home, school tuition (if the public schools suck, like in Nashville). I think as any generation ages and procreates, the burbs start looking more appealing. 

[JustN82]

On 12/20/2017 at 8:39 AM, smeagolsfree said:

The owners seem to charge higher and higher prices  for their units, however there will always be a core group, like large families and groups that will continue to rent those units because they are not monitored during their stay. These groups tend to abuse the privileges they have and many would be kicked out of a hotel for some of the crap they do in these homes.

 

Long time lurker but finally decided to join the discussion.  I just want to counter this point because I am one of those people.  Even before there was airbnb I was using vrbo and other sites to rent houses instead of staying at a hotel.  I've stayed at many great houses in Costa Rica, Peru, Puerto Rico and across America using vrbo.  I didn't stay at these houses to party or abuse my power,  I stayed because it comes with a kitchen and feels more like a home.  Another reason is because staying in a home you're out of the tourist trap areas that pop up around the hotel regions.  When I visit a location I want to be with the locals and have a more authentic experience; that isn't to say you wouldn't have that a hotel.

I might be in the minority here but I don't think you can classify everyone being in this group.  Just my .02

 

[markhollin]

^ ^ ^ Welcome to the forum, JustN82.  Feel free to contribute as much as you like.  Hope you can attend one of our Meet-Ups, which always happen on the first Saturday of each month.  : )

 

[smeagolsfree]

A welcome from me as well. Sorry, I did not mean to imply all groups at Air BNB's fit this catagory. Thanks for pointing this out.

[Edgefield D]

On 12/19/2017 at 3:40 PM, thenorthchannel said:

I found this story on The Ringer.  It's a well written take on the battle over Airbnb in Nashville.

https://www.theringer.com/features/2017/11/21/16678002/airbnb-nashville

It’s funny....the house he stayed in on Fatherland is behind me (we share an alley). There is also another type 2 across the street and down from it that is operating illegally. I do see the appeal and I have stayed in a type 2 in New Orleans before. I’ve also seen some crazy things go on at both of the places behind me. I mostly see bachelor and bachelorette parties. There are usually at least 8-10 in a group. The one thing I’ve never seen is the owner. In defense...I don’t know ALL of the homeowners around me. Out of 20 houses I know 12 of them. I’m not sure what the solution is...but there definitely needs to be a cap and the rules need to be enforced. 

[Pdt2f]

Apologies if this has already been posted elsewhere. It’s a review of recent additions, an overview of current projects,  and a look at what is expected in Nashville’s hotel industry, from Kurtz Hospitality Marketing. 

http://www.kurtzhospitality.com/market-update-now-essential-roundup-2017-nashville-hotel-market/

[MidTenn1]

Merry Christmas 2017 Nashville Urban Planet followers!!

Some new toys for 2018.

Some presents are opened and some will be opened later. Enjoy.    

 

P.S.; Santa brought me a new avatar.  

[markhollin]

Kurtz Hospitality Marketing gives an overview of Nashville's burgeoning hotel scene for 2017:

http://www.kurtzhospitality.com/market-update-now-essential-roundup-2017-nashville-hotel-market/

[markhollin]

Another strong quarter for construction and leasing of office space in Nashville, with 2.3 million sq. ft. completed this year, and 82% leasing in place when projects were ready.

https://cdn.baseplatform.io/files/base/scomm/nvp/document/2017/12/AYN_OfficeReport_4Q2017.5a4572ec938b4.pdf

[MidTenn1]

Some of the highlights!!

Happy New Year!

[MLBrumby]

Thanks man. Love those "cards". They summarize the projects in a glance. Happy New Year to all here. 

[titanhog]

Any of you guys going to Bicentennial park for the New Year's celebration?  Gonna be in the teens.  SOoooo cold!

Still think this should be on LoBro, especially this year, so that people can go in and out of the bars / restaurants to keep warm and grab a warm drink.

[MidTenn1]

6 hours ago, titanhog said:

Any of you guys going to Bicentennial park for the New Year's celebration?  Gonna be in the teens.  SOoooo cold!

Still think this should be on LoBro, especially this year, so that people can go in and out of the bars / restaurants to keep warm and grab a warm drink.

I was at the Titans game. Minus 10 degrees wind chill.  Decent crowd considering; maybe 40,000.

Most Jacksonville fans left at the half. 

[Rockatansky]

I'm OK with owner-occupied STRs, but the others should go the way of the dodo.

My guess as to why Nashville's population growth slowed: lack of housing units. Was the slowing also observed at the MSA level?

Edited January 2, 2018 by Rockatansky