I was grabbing a quick bite to eat earlier today at a trendy little restaurant in the Gulch when I overhead the following conversation between two seemingly educated 30-something professionals:
Guy #1: “Wow, this area of town is really pretty cool. I mean, it has some really tasty restaurants and stuff, but these condos are just dying. I hear that the Icon is only 10% full. God, I’d hate to own one of these *expletive * condos!” – laughter and takes another lunch time sip of beer.
Guy #2: “Seriously. I mean, I would live here, but not if I’m going to be the only one [sips a martini looking drink]. Dude, I was at this pool party like 3 weeks ago and it was chop full of hot chicks. It was sick!”
Guy #1: “Yeah man, I have a friend who rents down here and she is a total hottie too…I wonder how many hot chicks live here anyway?”
Guy #2: “Tons. We need to come down here more often. I wonder who these idiots are who are buying these condos?”
Guy #1: “Who knows? Probably no one right now [giggles a little]. I dunno though, I’m thinking that I’ll look into buying one in 2 years or so when the market hits bottom.”
Guy #2: “Yeah, they should be dirt cheap then. There will be millions of these things on the market. I’ll totally go in with you on one dude.” – turns up the glass and finishes drink with satisfied look.
Okay, now I know that the above conversation sounds like a conversation between two half wits, but the honest truth is that I have heard some version of this exact same conversation about a dozen times from very educated folks. It appears to me that everyone in town holds a strong opinion on the downtown condo market, but few seem to have done very much, if any, research. BTW – the Icon is just over 41% closed out as of today, not 10% and they raised prices on downtown facing condos this week.
Here is the year over year condo sales analysis for Nashville:
You’ll notice that in June of 2008, there was a spike in the number of closings that can be partially attributed to the grand opening of the Icon in the Gulch and seasonality. Clearly, the trend lines are narrowing and it will be extremely interesting to see if the remainder of 2009 can exceed that of the previous year. I am not ready to claim a full recovery, but I am ready to say that the market is showing very positive growth signs.
The Icon recently raised prices on all of their downtown facing condos and the Encore has notched another 20 closings during the summer months. It is clear to me that the super steal prices for the premium facing condos in the Icon have most likely come and gone. Now, it’s all about negotiating the non-premium facing condos in certain buildings.