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VOL. 45 | NO. 18 | Friday, April 30, 2021

East Nashville home goes for $175K more than list

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1104 Lenore Street

As the melee continues in the Nashville real estate market, the battles for homes have spread far beyond areas that might normally fetch prices in the tens or maybe even hundreds of thousands of dollars more than asking price.

But shrinking housing inventory and a bourgeoning herd of buyers seem to know no boundaries.

Last week, Shelby Hills – wedged between Historic Edgefield, East End and Shelby Park in East Nashville – got into the act with the closing of $950,000 at 1104 Lenore Street after veteran Realtor Kevin Wilson listed the enchanting home for $775,000, a big number in the area. Interestingly, this property sold for $194,900 in 2018 and $549,000 in 2019.

Selling for 22% more than list price is impressive in any area. However, if any house was going to accomplish such a feat, it was this one.

In describing the home, Wilson noted it features an open living plan with an eat-in kitchen that includes a large granite island, custom painted cabinets and the ever-popular open shelving that now graces many kitchen walls.

Outside there is a huge screened porch and an inground pool. Additionally, the garage is heated and cooled, not something seen every day. The owners threw everything, including the kitchen sink, into the project and were rewarded for it. They also threw sinks into the two full bathrooms and the half-bath.

No tub, no shower, yet a half-bath as the potential bather would only be able to comfortably bath half of the body.

Wilson is a kind, patient man, both characteristics required of the managing broker of real estate office, and he is the managing broker of Pilkerton’s 12South office. Conversely, he is a no-nonsense person, as witnessed by his directions in the Realtor remarks of this listing.

“No escalating offers and no love letters,” he wrote, a refreshing directive. Escalating offers are proposals included in the purchase and sale agreement that state: “Buyer will pay $5,000 more than highest offer.” What if there are three escalating offers?

As has been recommended in this weekly missive, there is no need for anyone to refer to the archaic term “price per square foot” these days, and this sale is a good example of why.

The house sold in September 2019 for $254 per square foot and was listed for $359 per square foot with this offering, an increase of $105, or 41%. Then it sold for $440 per square foot, $81 per square foot more than the list price on this 2,160-square-foot dwelling.

For those keeping score at home, that’s almost $200 per square foot more than what the house sold for 19 months ago.

The situation is dizzying for buyers and Realtors alike. It also has forced Realtors to adapt, and many that are not active in this wacky market are left shaking their heads as clients lose house after house because the Realtors felt they protected their clients by submitting offers with standard inspection procedures, appraisal contingencies, loan language and traditional occupancy and possession agreements.

Today’s market also are harrying for lenders who are forced to make loans on properties that will not appraise and with contracts that include non-conforming terms. While the offers are for “cash,” the buyers are usually obtaining mortgage loans.

With the loans come federal guidelines such as a regulation that the buyer must take occupancy within 30 days. Most sellers are demanding 60 days free rental.

The lender requires an appraisal, of course, and the appraisers have no way of keeping up with the market.

One appraiser will not include the houses that sold for the high numbers as comparable sales feeling that they are just as much an anomaly as houses sold under duress. Many feel foreclosures and short sales and foreclosures are the result of a financial disaster with the owners rather than a result of a market shift.

Some feel the current trend is similar in the opposite way.

However, in monitoring sales, particularly in Williamson County, it will only take a few months before every neighborhood has multiple sales for significantly more than the list price. Until then, appraisal contingencies be damned. No buyer will accept one.

Fear not for the appraisers, for the banks will require them, and most people are getting financing even though the contracts are not contingent upon them.

The same is true of inspections. Every buyer should have the home inspection and then decide whether or not to take the house, warts and all. If the warts are too hairy, terminate the deal.

Buyers demands based on inspection reports had gotten out of hand. Inspectors are better than ever, and they find everything. Every seller of every home should not be forced to hire a plumber, HVAC person, electrician and handyman for every purchase.

When does it end?

Johnny Mathis and Donnie Osmond have the answer. Mathis recorded “The Twelfth of Never” in 1956, and Osmond revived the song in 1973. These prescient singers have solved the puzzle.

This boom, and boom it is, will end precisely on the Twelfth of Never.

Richard Courtney is a licensed real estate broker with Fridrich and Clark Realty and can be reached at richard@richardcourtney.com.

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