Nashville rental prices dropping at fast rate, report shows

NASHVILLE, Tenn. (WKRN) — New numbers show rent in Nashville is dropping faster than in any other metro area in the country.

A September report from Realtor.com shows that Southern states are seeing a steep decline in rental prices, which is driven by a surge in multi-family developments in the area. Of the 10 metro areas with the largest decline in rental prices, eight of them are in the south.

Nashville has seen the largest decline in rental prices (4.8%) since last year, followed by Dallas. Memphis, Birmingham and Atlanta also had significant downward trends.

“You kind of have Nashville getting hit with a double whammy of a record amount of apartments supply, hitting all at the same time, as well as the seasonal cooling off that we see with rent prices,” explained Joel Sanders of Apartment Insiders.

Nationally, rent prices have dipped for 14 straight months, according to the report. Midwest cities, like Cincinnati and St. Louis, have seen the most robust increases thanks to their overall affordability and growing labor market.

Meanwhile, Nashville’s rental landscape is still finding its form.

“Nashville’s rental rates are trending towards their bottoming out. Where that bottoming out [in price] will happen, I don’t know,” said Sanders.

Sanders expressed the widespread rental supply across the South, which allows the growing demand to be met — for now.

“We know what the development pipeline looks like, it’s a question of how quickly that demand comes in to absorb it,” Sanders added.

And yes, because Nashville is growing, Sanders said that “bottoming out” is likely coming in the not so distant future.

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“With all the companies looking to do business in Middle Tennessee, that can really speed up some of the rental absorption,” explained Sanders. In turn, Sanders said the rental prices would then start to climb incrementally.

Despite the recent positive trends, Nashville’s average rental price, averaging at $1,578 a month, is still several hundred dollars more than nearby Southern cities like Birmingham, Louisville, and Memphis.

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