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VOL. 38 | NO. 11 | Friday, March 14, 2014

‘Freezenomics’ keeps high-end buyers home

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Freezenomics, a term being bandied about these days, refers to the negative effect cold weather is having on the economy.

While Nashville has endured its longest, if not statistically its coldest, winter in memory, real estate sales continue to climb, statistics from the Greater Nashville Association of Realtors show. Surprisingly, the pending sales numbers held strong as well, indicating more records ahead.

Sales were down 43 percent in the luxury market, pointing to an observation that rich people don’t like to get cold. In January 2013, 22 houses closed for more than $1 million. This year there were 13.

Freezenomics 101 now shows that in Nashville, the best deals available are in upper-end homes during cold weather.

Nashville got great publicity in Time magazine this week when Pulitzer Prize winner Jon Meacham wrote on “The South’s Red-Hot City.”

Many visitors to the city, anxious to see the sights and eat the food featured in Meacham’s piece, might be bewildered by the prices and lack of inventory in housing, especially in the Gulch and Midtown’s high-rise condos.

There is only one two-bedroom condo available in the Adelicia, and it is on the market for $895,000 and about to go under contract. There are no two-bedroom units with views left at the Icon.

Consequently, the 1212 building, located on the border of the Gulch, is the only game in town and, at more than $500 per square foot, is appealing. Developer Ray Hensler has delivered a remarkable product, and the price-per-square-foot demon that has haunted Nashville residential real estate for so long is being exorcised.

For example, there are guest quarters in the building. Therefore, homeowners do not have to pay for a guest room that is used three or four weekends each year. Nor are they required to pay taxes, insurance and utilities on the room. Parking spaces are included in the price, and they are together, side by side.

There is a facility that provides a bathing area for dogs. There are storage units and there are units with gas cooktops, not often found in downtown. And these homes are selling quickly.

Sales of the Week

There are two sales of note in this tale of one city, but the tales of two condos.

The first is unit #1113 in the Icon in the ever-popular Gulch. This a one-bedroom – you read that right, one bedroom – for $393,000. The unit is 11 stories above the city, has a downtown view and 945 square feet.

The floors are concrete, as is the ceiling, and there are one and one-half baths along with a den. The kitchen, dining room and living room are combined, and one parking place is included in the price. Another space is available, but those have gone as high as $15,000.

As was predicted when the Icon was being built, the owner took a bath – a bath in greenbacks. He bought for $319K in 2009 and was the first owner.

One group thrilled with the success of the Icon is Metro Nashville. This unit, one of 447 in the complex, reels in $4,010 in taxes each year. If $4,010 is the average, the development accounts for almost $1.9 million in taxes annually for the Icon residential piece alone.

There are several commercial establishments in the building. It would be a good guess that the land generates more than $2 million a year more than it did prior to the Icon being built.

This unit was listed by David Dorris, a veteran of numerous downtown/midtown condominium sales. Kelly Dever of Rasbury Realty represented the buyer.

Over in Green Hills, the Regency condominiums stand and hold the title of the first condo development in Nashville.

Most citizens couldn’t even pronounce the word condominium when they were unveiled. Now, they are among the most revered in the city, as a number of local celebrities call the development home.

While $393,000 will buy a one-bedroom, 945-square-foot condo in The Gulch, $372,000 will buy 2,556 square feet in the heart of Green Hills, one bedroom in The Gulch versus 4 bedrooms in Green Hills, one and a-half baths to three and a-half baths.

Fridrich and Clark’s Richard Bryan, an Icon dweller himself, was the listing agent, as he usually is, and the venerable Alice Bolster of the firm formerly known as BrokerSouth, now known as Neal Clayton Realtors, delivered the buyer.

Richard Courtney is a partner with Christianson, Patterson, Courtney and Associates and can be reached at richard@richardcourtney.com

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 0 0 0
MORTGAGES 0 0 0
FORECLOSURE NOTICES 0 0 0
BUILDING PERMITS 0 0 0
BANKRUPTCIES 0 0 0
BUSINESS LICENSES 0 0 0
UTILITY CONNECTIONS 0 0 0
MARRIAGE LICENSES 0 0 0