The same, only different: Nashville has seen a market like this

Friday, July 21, 2017, Vol. 41, No. 29

Greater Nashville Realtors President Scott Troxel drew some double takes when, after giving a summary of June real estate closings, he pronounced: “I suspect that we will come close to the record of 40,000 annual closings” that occurred in 2006.

For those involved in the market in 2006, this statement is mind-boggling. How could that be? Things are faster and crazier now, with everything less than $800,000 sliding into multiple offers.

There were 126 closed sales of over $1 million or more in all of 2006. There have been 170 so far this year.

There was more inventory in 2006, and things were calmer in general as other parts of the country had begun to fall prey to the Great Recession.

There was no Icon, no 1212, no Terrazzo or Rhythm. There was rhythm, but no condominium named Rhythm. The Sounds were in Greer Stadium, Vince Young was the Titan quarterback and the Predators had their best season in the nine-year history of the franchise.

Bill Purcell was mayor of Nashville, and it was due to his leadership that Nashville real estate is still chasing the 2006 numbers. In 2005, there were 79 high-rise condominium units sold. There were 347 in 2006, 257 of those in the Viridian.

The Viridian, Nashville’s first new high-rise, downtown condominium development, was orchestrated by Tony Giarratana and the leadership of the mayor’s office providing tax increment financing (TIF), a controversial tool that allowed the development to materialize.

Some view TIF as corporate welfare, while others “see it as a tool for individuals to achieve goals and for the city to provide affordable housing thereby stimulating economic investment in places where there would have been no economic investment,” Giarratana says.

There were only a few hundred Nashvillians residing within the urban core at that time, and downtown was beginning to blossom with the help of another visionary mayor, Phil Bredesen, who had negotiated the deal to bring the expansion NHL Predators to town.

By accepting TIF, Giarratana agreed to dedicate 20 percent of the units, 61 condo, to affordable housing. After the success of the Viridian, Giarratana utilized the same financing package at Encore with equally successful results.

The programs are rarely found today, as developers are able to secure financing without the requirement to dedicate units to affordable housing.

As the city and urban core began to embrace the “live where you work and play where you live” concept, people began moving downtown into a development that would never have survived the Recession without Mayor Karl Dean and the deep pockets of the Turner family. We hoped he could hold serve. Instead he charged forward and put the city on its current path.

In 2006, Germantown was better known as a suburb of Memphis, although Nancy Hardaway’s pioneering in the 1980s and 1990 had restored scores of homes that would have been lost. Andre LeQuire and Scott Chambers then revitalized the area, laying the foundation for what the explosion of recent years.

And Wedgewood Houston was a neighborhood void of condominiums and a spawning ground for affordable housing developers who could buy lots or teardowns for $30,000 to $40,000. 12South was happening thanks to an infusion of funds from Metro.

East Nashville, Purcell’s neighborhood, had bounced back from the tornado and, while short on trees, there were plenty of new roofs, porches and sunlight.

It had temporarily bumped Sylvan Park as the preferred home for the cultural creatives.

Several agents with the Wilson group had coined the term Historic West Town in efforts to make the Nations more attractive, as it was difficult to market properties that were viewed by buyers as being on the wrong side of Charlotte.

Now, The Nations, WeHo, 10South, 8South, the Icon, 1212, and any other developments are selling to the 100 people per day moving here.

There was a dark side to 2006, with predatory lending at its root. Anyone who could cloud a mirror could get a mortgage.

There were many in the affordable community helping legitimate buyers. Affordable Housing Resources, Habitat for Humanity, the Nashville Housing Fund, Tennessee Housing Development Agency (THDA), Metro Development and Housing Agency (MDHA) and the Nashville Homebuilders Association, along with the group then known as the Greater Nashville Association of Realtors, were aligned with the Mayor’s Office of Affordable Housing, led by Hank Helton, in providing housing for the workforce.

Now the affordable housing community is challenged by the escalation of property values, but Mayor Megan Barry has bolstered the affordable housing efforts with $10 million to the Barnes Fund and with her Housing Incentive Pilot Program.

Additionally, she has appointed the highly regarded Adriane Bond Harris to head the Mayor’s Office of Housing. It could come down to the wire. 2006 versus 2017, a battle of the Titans.

Richard Courtney is a real estate broker with Christianson, Patterson, Courtney and Associates can be reached at