Franklin Monthly Real Estate Recap: February 2024

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In contrast to January, February is indeed the shortest month of the year. Just like this, it's over and we're on to what is traditionally the hottest time of the year for Real Estate!

I've spent these past several weeks on and off of our local TV News stations, giving input and sharing insights on our market movement, which has been more active than this time last year. That's been a welcome change from 2023. 

But it's not all good news. The truth is.. though busier, our Real Estate market is not as active as initially anticipated at this point due largely to the Fed's change in course as we continue to battle inflation in the US economy.

Key Points

• The US economy is performing better than feared.. which is something to fear itself. Well, not fear exactly... but deserves some caution. So basically everything else happening with mortgage interest rates is a result of this.
• We expected by now that the Fed would start lowering its funds rate, which directly and indirectly impacts the markets on a variety of levels. Since the economy and Real Estate have been performing to strong, that has not happened and what we're noticing in Real Estate as a result is mortgage interest rates are not going down as soon as anticipated.
• As of today, mortgage interest rates are the highest they've been so far in 2024 -- but still almost a full point below where they were in 2023. (see chart by Mortgage News Daily)
• Our Real Estate markets, both nationwide and locally, are seeing continued increases in pricing as well as Buyer demand, and stagnant inventory levels.

Local Performance

To put it simply, as of the end of January, we hit the highest median and average sales prices EVER in Williamson County. 

Median home price = $975,000

Average home price = $1,327,000

We also closed out January with a lower amount of homes For Sale than at any point in 2023.

No doubt those two numbers play into each other. Fewer homes For Sale, selling at a higher price, is a strong signal that Buyer demand is still out there, regardless of interest rates and our higher home prices.

If you think about it, it makes sense. Buyers and Sellers can only put their "moves" on hold for so long.. and we're going on 2 years since interest rates started shooting up, bringing so many Real Estate moves to a halt.

And though the nationwide numbers are not as pronounced as our local stats, higher prices and lower inventory is a similar trend across the country for January. Which is why the Fed continues to be persistent, trying to control prices and inflation as we head into March.

I don't know if any other graph can paint a picture of our increasing local housing demand year-to-year in Williamson County as much as this one:

The black dot represents the number of homes sold.. which seem to stay in the same bracket range year-to-year... while our sales prices are basically running away. We are only able to buy/sell as many homes as are available.

Individual Median Price Performance throughout Williamson County:

• Fairview: $440,000
• Spring Hill (Williamson): $687,450
• Thompsons Station: $691,250
• Nolensville: $960,000
• Franklin: $995,000
• Brentwood: $,1302,500
• Arrington: $1,449,000
• College Grove: $1,674,801

Grassland, our little section between Brentwood and Franklin, pulls a median price of $890,000 as of the end of January. It's important to know this is not our highest ($1,430,000) or lowest ($692,000) median price in the past 13 months. Our data here fluctuates pretty dramatically largely due to such a diverse price range of homes, yet so few homes sold each month this year, thanks to low inventory.

Looking Ahead

Expect more confusion in the headlines. I saw a Real Estate Data Report today titled, "More Sellers, Fewer Buyers." What most of us think when we hear that is supply exceeding demand. But that is not what the author intended. I expect the author had a "d'oh" moment before going on to clarify that he meant More Sellers = we have more Sellers than last year.. and Fewer Buyers means fewer Buyers than we had been expecting for 2024. But as evidenced by our home sales prices, there are still a lot more Buyers than Sellers in our current Real Estate market. In no way have the tables turned.

A leading indicator to keep an eye on is Pending Home Sale Prices... these are prices for homes Under Contract (and will contribute to our February and March data.. to be reported as Closed sales prices in the next few weeks). For homes that went Under Contract this week, the median price is up 2% from this time last year. So March and April's sales price reports will likely reflect this.

Mortgage rates continue to be what everyone is watching. Inventory of unsold homes consistently rises with stubborn mortgage interest rates, and we have little reason to believe there will be much softening for another few months, at least. Expect to hear reports of inventory rising.. and expect to hear about home price reductions as a result. But don't get too worked up over this. 

Locally, here in Williamson County, our market seems to be relatively resilient to these factors. 

We started 2024 with a considerably low amount of homes For Sale.. as evidenced by the green dot on the left of the graph.

The blue dotted line represents last year (2023) and the black dotted line represents 2022. You can really tell when interest rates started rising in 2022. Our inventory followed a pretty pronounced pattern of correlation.

The red dotted line represents 2019... and that is widely considered our last "normal" year in Real Estate. Even with 2019 hailed as such a good year of consistency, rhythm and normalcy... I still remember at the time discussing (and even lamenting) over our low inventory. Even as high as the number looks in 2019... it was still considered low inventory. Our green dot starting 2024 is probably our second-worst year in history for inventory.

So even if we had a dramatic rise in inventory here, we'd still be below where we need to be to meet demand. And I wouldn't shy away from broadcasting that at all.

In fact, when all you read and hear about is doom and gloom in Real Estate, you know I'm probably not far with some perspective to take to the news.

--- Visit Erika's Links ---

Thinking of moving? Need a plan tailored to your needs? I'd love to help you. I'm a Franklin resident and a Multi-Platinum Award-Winning Williamson County REALTOR ranking in the top 1.5% of agents locally. I am a top producer within Benchmark Realty, the largest brokerage in Tennessee and among the largest in the country. My continuing education includes several designations and my experience keeps me up-to-date with fast-changing market trends. I am a Million-Dollar GUILD Member of the Luxury Home Marketing Institute, my market insights are regularly featured in broadcast media, and my success planted me on the front page of a December 2021 Nashville-area Magazine. But most importantly, I specialize in helping my friends and neighbors buy and sell homes. Why look further when you've got a friend and neighbor who is among the best in the business!