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Wow - 2025 has started with a bang. For some, the year is off to a great start! There's promise this year is the beginning of better health, or turning a new leaf with personal struggles. Many others are facing opposition. Not only are we seeing natural disasters and tragedies nationwide, but I personally know people in our community dealing with sudden tragedy or barely getting by financially. I'm hoping this year ends up bringing all of us more promise and joy than challenges.
In local Real Estate, some of our hurdles may alleviate. In fact, one of the biggest hurdles in Williamson County -- home prices -- is on track this month to be lower than the start of 2024. This January is not yet closed out and the official numbers won't be in for another week. But if preliminary indications follow through, our home prices for January 2025 could be among the lowest we've seen in a year-- though still considerably higher than in January 2023. This is likely temporary as prices typically trend higher the deeper we get into Spring.
If you're holding out for a dramatic dip in mortgage interest rates, though, the market will pass you by. There is little-to-no expectation that mortgage interest rates will dip below 6% this year.
Rate of Home Price Appreciation will Slow
It's not a huge surprise to see our preliminary numbers for January showing a slight dip in home prices. First of all, as you can see in the graph below, our home prices month-to-month fluctuate.
January 2025's line could end up just underneath the blue dotted line representing January 2024. If you're looking for when to pounce as a Buyer (hint hint), it wouldn't be unusual for prices to continue to decrease through February before gearing up for Spring market.
This year, there is a majority expectation between economists and real estate forecasters that we will hit new highs in home prices. However, the rate in home price appreciation will slow -- prices won't go as high as quickly as in years past -- and this is a good thing!
Instead of seeing home prices rising 19% as seen in 2022, we are currently down to the single digits, with the expectation of only a 3.6% increase in home prices YTY from Q4 2024 to Q4 2025. This means that a home that sold for $800,000 last month will only increase in price by $28,800 by this coming December, which is healthier for everyone.
To put this into perspective, we had about 3% appreciation rates locally in 2019, and that was considered normal/healthy (and even slightly better than normal/healthy).
Do not panic and confuse this with an overall decline in home prices, though. That is not what these numbers represent nor what is expected.
Local Snapshot
Peeking in on our current activity throughout Williamson County, here's how our communities look so far in 2025 considering median price and Days on Market:
- Arrington - $1,100,991 (-24% YTY) / 8 DOM
- Brentwood - $1,150,000 (-12% YTY) / 35 DOM
- College Grove - $1,297,864 (-23% YTY) / 2 DOM
- Fairview - $654,500 (+33% YTY) / 31 DOM
- Franklin - $1,093,750 (+9% YTY) / 41 DOM
- Nolensville - $1,050,000 (+10% YTY) / 22 DOM
- Spring Hill - $677,000 (-2% YTY) / 36 DOM
- Thompsons Station - $900,000 (23% YTY) / 61 DOM
A couple of quick takeaways from this data is there seems to be a correlation between the percent of decrease and Days on Market. The areas with the lowest Days on Market are showing the largest decrease in home prices from this time last year. Perhaps local Sellers in these areas are slashing prices to sell fast?
Another factor to consider is new construction. Perhaps smaller homes are being built in these areas, diluting local averages. That would also make sense with faster days on market -- smaller homes and their price tags are becoming more in demand simply due to affordability needs.
Realtor.com has drawn a similar correlation nationwide with its data -- suggesting the number of smaller homes sold recently are contributing to price declines. Not that homes are losing value -- in fact, Realtor.com reports an increase in price per square foot. There are just fewer square feet in homes being sold right now.
We will know more about the exacts of that theory locally as soon as I have a chance to dive into that data once it's released - and of course I'll share!
Overall
Real Estate is no longer as cut and dry as it used to be. It's become an incredible investment -- especially these past 5 years -- but if feels scarier because of the increased volatility in national and global markets.
Greater Nashville, and especially Williamson County, are relatively insulated. Not immune -- but insulated. The blows and struggles aren't near as dramatic as hardships seen in neighboring counties and states. The whole of Davidson County and surrounding ended 2024 on a pretty high note!
I suspect by end of March, we'll have a good hold on the pattern taking shape for 2025. Buyers want more from this market. And Sellers are just about ready to get off the sidelines and deliver. This is promise for joy - and in Real Estate, it's never without a challenge. But that's why you have someone like me to guide you through it.
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!
