When looking for properties to invest in, landlords often look to cities and growth areas with plenty of activities for families and single people. Nashville is the perfect cross-section of activities for everyone while having safe and beautiful neighborhoods as well as high-quality schools, hospitals, and community centers. Because of this, many people are looking to invest in properties in and around the city to capitalize on the ever-growing and changing population. However, before you start spending, here are ten things to know about Nashville Investment Properties.
The Job Market
Nashville is the second highest city in America in terms of the job market and job availability. With new businesses opening seemingly every day, the demand for workers is rising rapidly. This means that more and more people, a good percentage of them renters, are flocking in and around the city to capitalize on those job openings. And with the average annual salary in Nashville, Tennessee being around $52,000, the job market will only grow. Even if a high turnover rate of workers occurs, the current influx will last for years to come.
It’s no secret that the influx of people in Nashville and the surrounding area is due to the increase in available jobs and the allure of such a modern city. There’s plenty of money to be made, which means more and more families are looking for financial security. In addition, Nashville has been one of the top cities for population growth for the past seven years, with an increase of around 20 percent in the last decade. This increase doesn’t show signs of stopping, especially considering the rise in movers due to the pandemic. According to a study by the University of Tennessee, the state will see an influx of 7.87 million people in the next 20 years, with a projected 57 percent of that increase being in Nashville.
Over the past three years, rents have increased by over twenty-five percent in Nashville. About 48 percent of the total housing in the metropolitan area are rental units. Because 74 percent of the rental units in Nashville are between $1,000 to $2,000 per month, it is a relatively affordable place to rent compared to other major cities such as Orlando or San Francisco. Due to the growth, Nashville may be the place to do just that if you’re looking to invest in properties that higher-income families will look to rent.
Quality of Life
For many, renting in Nashville can be very divisive. Because of the lively culture, music, activity, and general modernization of Nashville, many renters tend to renew their leases in Nashville. For others, it can be too loud, expensive, and gaudy, so the opinion on the quality of life depends on who you ask. However, if you have your target renter audience in mind, those are the people you should ask. If you’re looking to rent to older adults, their opinion on their quality of life in Nashville may be lower, and they’ll tend not to renew their lease and move out of the city. However, if you’re aiming for a younger, wealthier renter audience, their opinion on the quality of life will be much different, and that is the audience for whom you should aim.
There are many public and private schools to choose from in Nashville, and there is no shortage of quality education. One of the best school districts is in Williamson County, right outside downtown Nashville. Many of the higher-quality family rental properties will be in this area. So again, who you want to rent to will determine where in the area you should invest. You should stick closer to the higher-rated school districts if you’re aiming to rent to families or even older adults.
Because Nashville is home to many historic sites, many properties are older. While this can undoubtedly raise the value of a property, it can also mean that it may require some extra TLC and investment. If you’re also interested in flipping the homes, stick to the more historic side of Nashville. Typically, this is where the older adult renters will stick to, but remember that historic homes can come with many problems, so remember to have a keen eye when viewing properties near or in historic districts.
Because of the massive influx of people and the current job market, many landlords are looking to invest in Nashville and the surrounding areas. Newer landlords must watch for competitor rates, offers, and amenities. While keeping an eye on your competitors is always essential, especially if you’re trying to get a beat on what you should offer and charge, the competitor market is growing quickly in Nashville. Though you shouldn’t jump into an investment too quickly, if you’re looking to invest in Nashville properties, you may want to do so expeditiously before the competitor pool becomes too full and you can’t charge the amount of rent that you typically would be due to competing prices.
The Street Scene
Because the look of Nashville can change from block to block, it’s important to survey the surrounding areas before investing in a particular property. What may look like a home in a beautiful woodsy town may be next to a train track or industrial district. These t issues can burn a big hole in your pocket if they prevent most tenants from wanting to move in. If you’re not careful, you may put down a lot of money for a home that few will want to move into. While you should consider this wherever you invest, this is especially prudent in Nashville due to the ever-changing terrain.
Security Deposit Laws
The security deposit laws in Tennessee can be confusing, and you need to know them if you’re renting out in Nashville. While there is no security deposit cap in Tennessee, there are strict storage requirements for said security deposit. A security deposit cannot be in any account that contains a landlord’s personal assets and must be kept in a separate account that the tenant is aware of. In addition, a landlord must return at least part of the security deposit within 30 days of lease termination or face possible litigation.
Tennessee is often seen as a tenant-friendly state as some laws favor the renter over the landlord. It is important to note that while a landlord has the right to raise the rent as they see fit without limitation or notice, tenants have the right to withhold rent if the landlord has not provided suitable housing conditions. In addition, if a tenant provides 30-day notice before leaving a monthly lease property, they can terminate the lease at will. Also, if a landlord breaches any part of the lease agreement, the tenant can terminate the lease early.
Keeping these ten things in mind when investing in Nashville properties can help you make the best decisions before you spend. If you’re looking to get a better grasp on what the market looks like in Nashville, Excalibur Homes has houses for rent in Nashville for tenants and landlords alike to look into.