PwC’s Insights on Real Estate Markets reveals that the real estate industry is adapting to a new normal characterized by remote work, shifting consumer preferences, and economic uncertainties. And one of the cities to come on top was Nashville. Music City maintained its position–for three years– as the top prospect for real estate investors heading into the coming year, according to the annual “Emerging Trends in Real Estate” report by consulting firm PwC and the Urban Land Institute. Dallas and Atlanta are now closely following Nashville, CoStar reported.

Based on surveys and interviews with over 2,000 real estate professionals, the report highlights Nashville’s achievement as the first metropolitan area since San Francisco in 2014 to secure the top ranking for two consecutive years. This recognition reflects Nashville’s resilience and attractiveness as an investment destination facing economic uncertainties.

The report underscores economic concerns, including interest rates, availability of labor, job and income growth, and inflation. Housing affordability emerges as a major social concern, particularly in high-growth cities like Nashville.

Nashville’s repeat as the top prospect in the real estate market reflects its robust apartment demand and strong job growth. The city’s ongoing developments, such as the Nashville Yards project and Oracle’s campus, contribute to its attractiveness for multifamily investment.

Yet, housing affordability remains a challenge in Nashville.

Market preferences have remained consistent, with “smile” markets in the southern third of the country continuing to attract investor interest. The Smile markets (aka the Sunbelt States) are some of the fastest-growing real estate markets in the nation.

Sun Belt markets, known for their affordability and economic opportunities, dominate the top real estate markets for 2024. Despite challenges such as high-interest rates and pricing disagreements between buyers and sellers, opportunities exist for high-quality properties that meet the evolving needs of investors and tenants.

“Housing markets are healthiest where affordable home prices and strong employment are giving young hopefuls a real shot at buying and starting to build equity,” Anushna Prakash, data scientist for Zillow Economic Research, told USA Today. “I’m cautiously optimistic that the housing market will get back on stable footing in 2024 −- we shouldn’t see the massive price spikes of the early pandemic or fast-rising mortgage rates of recent years.”

Zillow’s analysis identifies Buffalo, New York, as the hottest housing market of 2024, driven by affordability and strong employment prospects. The company emphasizes the importance of affordable home prices in fostering homeownership and building equity, particularly for young buyers. While mortgage rates have shown a downward trend, contributing to an uptick in existing-home sales, the housing market continues to grapple with inventory shortages.

Photo by Cesar G: https://www.pexels.com/photo/cityscape-of-nashville-tennessee-at-dawn-13899090/