Below is a chart of the 40 largest metro housing markets in the country, with the U.S. on top and Nashville fourth from the bottom. I wanted to share this chart with you because I find the categories that it tracks interesting.
Most of the time you’ll see MoM (month-over-month), YoY (year-over-year), and YTD (year-to-date) when it comes to tracking data. Yes the chart below does track MoM and YoY, but it also tracks where each individual market as of the end of December 2023 versus 1) the 2022 pricing peak, 2) the peak during the pandemic, and 3) more specifically the appreciation since March 2020, which was the beginning of the pandemic.
I find the latter three categories very useful information because those are three times that people seem to compare current prices against, at least and most definitely since March 2020 before prices ripped upwards.
Everyone wants to go back to that time when houses were “affordable”, or when they could’ve gotten so much more for their money. Hind sight is 20/20, right?
Let’s begin with the national housing market. Across the United States, home prices were:
- Down -0.6% from November 2023 to December 2023
- Up 3.2% from December 2022 to December 2023
- Down -0.8% from their highest peak in 2022
- Down -1.4% from their highest peak during the pandemic
- Up 39.8% since March 2020
That last number always gets people. We all knew home prices went up, but to see with concrete data that home prices went up 40% in only 3 years is, in my opinion, absolutely crazy!
Now comparing the national housing market to Nashville. Home prices in Nashville for those same categories were:
- Down -0.6% from November 2023 to December 2023
- Up 0.3% from December 2022 to December 2023
- Down -4.9% from their highest peak in 2022
- Down -4.9% from their highest peak during the pandemic
- Up 43.9% since March 2020
So, I would interpret that as Nashville outpacing the national housing market over the longer term (since March 2020), but underperforming after we hit the peak prices. Albeit, coming down only less than 5% from the pricing peak in 2022, after ripping upwards almost 44% since the beginning of 2020, isn’t too bad, and certainly nothing to be concerned with.
That’s because there isn’t a fundamental flaw as to why prices came down slightly since their peaks. I mean the word “peak” means the very top, so by definition, you can’t stay there forever. Unless, of course, all economic factors are favorable for longer, and we know that interest rates shooting up put a damper on demand, which in return kept a ceiling on prices.
Take a look and see how other major metros compare versus both the national and Nashville markets.
P.S. Look at Tampa, Florida since March 2022. Up 58.9%! And to think there were people living in Tampa in February 2020 saying to themselves that the housing market was overpriced and “we’re going to wait until the prices come down.” Boy were they wrong! The same is still being said today, and while what goes up must come down, the data tells us that demand is still outpacing supply and unless an incremental amount of supply comes to market, quickly and consistently over a period of time, then prices will remain relatively high and not see significant declines.