Active Listings Rocket to New High | Nashville Housing

Active listings just rocketed to a new high this year. This is particularly interesting because this didn't happen this way last year. And it's not that demand is continuing to drop actually demand is up. So the fact that active listings are skyrocketing is very interesting. Now what makes it more interesting is where they're coming from. But first I want to show you expired and canceled listings. I showed you this last week and asked for some theories. I got some pretty interesting answers on Twitter. Someone posted that new builds were driving this, which is true. And I also got this comment, some of its agents delisting and relisting to hide the price cuts in time on market. Now I in general agree with this. In fact, one of the reasons I don't ever talk about days on market is because it just feels like a fake statistic. You can delist and relist all the time, anytime you want. And you can see as many canceled expired as we're getting. It seems like it would obfuscate any value you'd get out of that days on market. Nonetheless, the price cuts thing caught me by surprise because when I did look at single families that had canceled or expired in August, I looked at how many had relisted in September and of the ones that I identified that relisted 46% actually dropped their price, which may mean that the price cut percentage that we're seeing could actually, in fact, be a lot higher than the data suggests. Very interesting. One thing I wanted to point out, I love migration data and I finally found some really good data here. This is Redfin migration data, and you can see Tennessee again is just scorching hot. More than 9,000 people were searching to move into Tennessee state versus out of the state. Now, the reason this is huge is because the population Florida is obviously number one at 25,000, but the population of Tennessee is less than a third of what Florida is. And you can see we have 9,000 versus the 25,000 proportionally. Tennessee is as hot as it gets in terms of the inbound migration, North Carolina and South Carolina are up there too. In fact, I would say the only state that I could find on here that might be hotter than Tennessee is probably South Carolina. Again, when you think about proportionate to population, Tennessee is scorching hot. Nonetheless, you're hot. You're hot places, Tennessee, North Carolina, South Carolina, Florida. Let's look at the population. Florida's population 22.4 million, 22.2 million people, Tennessee 7.051. I guess that's according to census and Google, but there's another metric that is exploding that we can see and it is absorption. Now, if you don't know what absorption is, I get this question a lot. Absorption is just the incremental increase in units that are running. Okay. And this is costar data. So it's primarily multifamily, if not all multifamily, and they have 11,726 guys, 11,726 to give you an idea of just how high the absorption is in Nashville, 11,726. We may exceed what happened in 2021. In fact, we're on track to have a better year of absorption than 2021. There is a massive, massive inbound migration move. Now this isn't all inbound migration. Yes. Inbound migration is strong, but there's also the demand for the majority of the year has been lackluster in single family. So it's hard for me not to imagine that the low, the lower rent rates, which by the way, rent's going down. And this is not me trying to paint a rosy picture for multifamily. It's a disaster. Okay. Don't get me wrong. It's a disaster, but one bright spot is the demand that we are seeing. And you can see here in this chart that we are now year over year in December, we will likely be year over year negative again. The reason that's important is that would be the third year in a row that we had a drop from December data since it peaked in July, June, July of 2022, it dropped in December, it dropped the next December. And now we're about to have another trough in December. And that trough in December will be lower for really three years in a row. It's just dropped to a new low. And this brings me to my point. None of these multifamilies that were built modeled negative year over year over year rent growth. Okay. They're not modeling this, not with higher interest rates and lower vacancy. So even though we are having rents drop, even though we're having a record number of active listings, just know there is an interesting bright spot in demand and in migration data. In fact, we're going to get to some of the places that demand is still just so strong. Let's look at contract volume. This is contract volume for single family. Okay. So we're moving back into single family here. Contract volume is actually up now 6.4%. Okay. This is a, this is essentially a Excel. This is a speed gauge. Okay. I just take the contract volume over the past 31 days and plot it every single day. So the fact that it's up 6.4% just means that today in the last 31 days, we have 6.4% more contracts than we did last year at this time. This is pretty interesting because typically what we see is that demand kind of drops off for the rest of the year. We are not seeing that. So even though demand is flat, the fact that it's flat means that it's up for this time of year. We can see, we went from being down almost six to 10%, being up almost six to 10%, pretty interesting stuff. So contract volume is up. I'll take a look at active listings. Active listings are up almost 1400, I guess, 1,200, 1,350, 1,350 units from where they were last year. Active listings are up 21.7% year over year and the single family market. What makes this absolutely shocking is that 100% of the growth is in existing homes, not new builds. In fact, when we look at the breakout between existing and new year over year, this is comparing the same day last year to the same day this year. We can see that active listings in existing make up 100% of the increase in active listings for this year. That is astonishing. New builds are flat. They are flat, actually negative 25, 25 listings. Now we can dive a little bit deeper here and look at price bands. And when we do that, we can see that the million dollar active listings, they're up almost 20%, maybe a little bit higher than 20% here in the existing. And they're down in the new builds. What makes that fascinating again, look at demand. And we look at contracts. Contracts are up almost 20% in the existing, and they're up even more than that in the new builds. So contracts in the new builds are up for million dollar active listings pretty significantly in both existing and new builds, even though active listings are flat with the new builds and existings are up, but given the increase in demand, it really doesn't feel like they're up that much. And if you've been hunting for a million dollar listing, you probably know that I've talked to a lot of you waiting for the million dollar crash. And there are some out there. I saw one in Atalicia and Atalicia has got some problem. We've talked about some of their problems, but one of their problems is that buildings are building around them and it's cutting off the views. And there's one that dropped $200,000. I'll see if I can get it for you. Drop $200,000 below where it sold just a couple of years ago. I'll, I'll see, I'll show you that listing here shortly, but let's look, look at active listings under 700,000. Look at this. They've grown almost a thousand units in existing active listings have grown almost a thousand new builds again, relatively flat. Let's look at contracts. Contracts have barely budged up from where they were last year. Gone from 1145 to 1224 was at 80, 80 units. Well, when you grow almost a thousand units, 80 just really isn't cutting it. And the new build increase nine units contract. And look at this new builds have increased about what, what is that 50 over last year, 52. So you can see new builds are moderating their inventory. They're moderating their inventory for the demand that's out there. Whereas the existing, we've got some kind of, we've got some alarm bells. Now, the other thing that I didn't mention on here, and I kind of mentioned it with that condo listing in the Adalicia is that condos are a completely different story. And I mean, in a bad way, okay, condos are not going well. And I haven't dug into the data, so I can't say anything more than that. But when I looked at this chart, a significant chunk of the canceled listings were from condos fact, condo canceled listings, I think had doubled from the previous year. So I'm going to, I'll, I'll dig it a little bit into condos, but for the single family market, you can see that demand is starting to stabilize prices. I told you a couple of weeks ago that they've started to stabilize. All those price cuts are starting to get absorbed. We're seeing contract price stabilize. A lot of stuff is stabilized over the next month. So I'm not seeing any massive price drops in the data yet for the fall. But what I am seeing is that that very rapid price drop has brought us back to where we were in early spring. And so it's an interesting time, given that active listings are up so much higher where they were last year, demand is stabilized. Prices is stabilized. Is it going to change? Are the elections going to make people sit out? Doesn't appear that they are at least right now, at least in Nashville, that may be the migration story. So with that, I hope you have a great day. I appreciate you watching and I will see you next Saturday.