Nashville Real Estate Market Report 2019

Nashville Overview

Nashville is the capital and most populous city in the State of Tennessee as well as one of the best cities in Tennessee to live and work in.

Featuring a population of over 692,000 people, Nashville is the 24th largest city in the US as well as the anchor city of the 14-county Nashville metropolitan area with a total population of above 1.93 million people. The population of the Nashville-Davidson-Murfreesboro–Columbia combined statistical area exceeds 2 million people.

Nashville enjoys a diverse and fast-growing industry which comprises a strong positive indicator for both commercial and residential real estate investing. In specific, in recent years the city has been called a southern boomtown as it has the third fastest-growing economy nationwide and is one of the cities creating the most high-wage jobs. This has led to a high population growth with about 100 people being added to Nashville’s net population each day. The high increase in the population is another indicator that Nashville’s real estate market is a hot one.

Although Nashville is known as Music City and the Home of Country Music, health care is the major industry there. The city hosts more than 300 health care companies which constitute some of the biggest employers there. In addition, Nashville is a music, publishing, banking, and transportation center, which is also home to one of the largest private corrections companies in all of the US.

Nashville is called Music City as it hosts offices of the Big Three record labels as well as many smaller independent labels. Indeed, the city is the second-largest music production center in the US after New York City.

Moreover, Nashville is an important educational hub. It is home to Vanderbilt University, Tennessee State University, Belmont University, and others. This concentration of educational institutions creates a strong demand for Nashville rental properties – both long-term (throughout the school year) and short-term ones (especially around homecoming weekends and graduation).

The per capita income in Nashville-Davidson, TN is $31,109, comparable to the national level of $31,177. The median household income amounts to $52,858, below the nationwide level of $57,652. Importantly for real estate investors, nearly half (48%) of Nashville’s population is comprised of renters rather than homeowners, which means a tenant pool of over 331,000 people. This translates into a strong demand in the traditional Nashville rental market.

Due to the numerous attractions, Nashville constitutes a popular tourist destination visited by more than 15 million people per year. The main tourist attractions include Music Row, the Country Music Hall of Fame and Museum, the Parthenon, the Hermitage, the Grand Ole Opry, and others. Needless to say, all these important places to visit have turned the Airbnb Nashville, TN rental market into one of the hottest nationwide.

Nashville Real Estate Market Overview

Median Property Price: $435,900
Real Estate Appreciation: 120% since 2000 (significantly above the Tennessee and US average)
Days on Market: 63
Listings for Sale: 1,267
Price to Rent Ratio: 21 (high)
Buyer’s Market or Seller’s Market: A buyer’s market
Renters’ Percent of Population: 48%

The Nashville housing market has been attracting real estate investors for years, especially after the city’s economy was highlighted as one of the fastest-growing economies in the US. However, this year the demand for real estate investments in Music City escalated even further after PWC ranked the Nashville real estate market as the #5 among US Markets to Watch for overall real estate perspectives in its annual Emerging Trends in Real Estate: United States and Canada 2019 report. As a result, Nashville is continuing to attract capital from all over the world, with foreign investors being able and willing to pay higher prices than local real estate investors of Nashville. According to the prestigious publication, the main drivers of the potential of the Nashville, TN real estate market include demographics, economic indicators, and attractive Nashville cost of living which is driving the relocation of a major financial services company to the Tennessee capital.

Despite the heating of the local real estate market, Nashville house prices remain more affordable than in many of the top hot real estate markets. Nevertheless, the median price of homes for sale in Nashville, TN is $425,900, which is about double the national home value of $229,000.

The best news for Nashville real estate investors is that despite all the activities in the Nashville housing market, it is moving towards a buyer’s market. This means that those looking to buy Nashville, Tennessee homes for sale have the upper hand. This is due to an increase in the number of real estate developers working in the local market, leading to more and more new construction. Consequently, inventory is able to catch up with demand, and property investors as well as homebuyers can choose from the 1,267 Nashville real estate listings available there. In addition, the price to rent ratio in the Nashville real estate market is high, which translates into strong demand for long-term rental properties in Nashville. Furthermore, the high number of tourists and other visitors signifies an equally strong if not stronger interest in Nashville vacation rentals.

Best Property Types for Investing in the Nashville Residential Real Estate Market

Single Family Homes for Sale in Nashville, TN: 858
- Median Property Price: $439,100
- Average Monthly Traditional Rental Income: $1,760
- Average Traditional Cap Rate: 1.9%
- Average Monthly Airbnb Rental Income: $3,860
- Average Airbnb Cap Rate: 6.9%
Townhouses for Sale in Nashville, TN: 140
- Median Property Price: $279,200
- Average Monthly Traditional Rental Income: $1,520
- Average Traditional Cap Rate: 2.5%
- Average Monthly Airbnb Rental Income: $3,250
- Average Airbnb Cap Rate: 6.9%
Condos for Sale in Nashville, TN: 93
- Median Property Price: $402,900
- Average Monthly Traditional Rental Income: $1,540
- Average Traditional Cap Rate: 1.6%
- Average Monthly Airbnb Rental Income: $3,330
- Average Airbnb Cap Rate: 4.8%
Multi Family Homes for Sale in Nashville, TN: 16
- newMedian Property Price: $785,500
- Average Monthly Traditional Rental Income: $1,770
- Average Traditional Cap Rate: 0.9%
- Average Monthly Airbnb Rental Income: N/A
- Average Airbnb Cap Rate: N/A
Foreclosed Homes for Sale in Nashville, TN: 26
- Median Property Price: $237,000
- Average Monthly Traditional Rental Income: $1,470
- Average Traditional Cap Rate: 2.8%
- Average Monthly Airbnb Rental Income: $2,990
- Average Airbnb Cap Rate: 7.0%

Similar to other major real estate markets, the Nashville housing market 2019 is largely dominated by single family properties as they comprise about 68% of all Nashville homes for sale. Townhouses for sale in Nashville, TN make up 11% of the total inventory, followed by condos (7%) and multi family homes (1%).

Why Investing in Single Family Homes in Nashville

Nashville real estate market analysis shows that single family homes are a good property type for buying an investment property in the local market. Their median price is similar to the city level, so they do not require more rental property financing than other options. They constitute the majority of Nashville real estate listings, which means that investors interested in this property type are more likely to find the exact property which they are looking for in terms of budget, characteristics, and investment potential. Moreover, single family homes tend to attract small families who are usually good and reliable tenants paying rent on time and causing only minimal wear and tear to the rental property. In addition, single family home rentals in the Nashville housing market enjoy high return on investment whether rented out on long-term or short-term basis. They are particularly profitable as vacation rentals in Nashville, TN.

Why Investing in Townhouses in Nashville

Townhouses constitute the optimal property type for buying an investment property for renting out in the Nashville real estate market. They cost about a third less than an average home for sale in Nashville, while offering the highest return on investment for both rental strategies. With 140 townhouses for sale to choose from, real estate investors will definitely find the most profitable Airbnb Nashville rental property.

Why Investing in Condos in Nashville

Condos can also constitute a profitable real estate investment opportunity in the Nashville, Tennessee housing market. Their median price is lower than the city median level, but they tend to cost more per square foot because of the additional amenities and services. While condos’ return on investment is good for both Nashville long term rentals and Nashville short term rentals, the cap rates for both strategies are below those offered by single family homes and townhouses. Moreover, real estate investors have to do detailed research on the HOA’s rules and regulations before buying a condo in any location to make sure that renting out the property is allowed, especially as an Airbnb rental.

Why Investing in Multi Family Homes in Nashville

There are only a few multi family homes for sale in Nashville, TN at the moment, and they don’t offer a very high return on investment when rented out traditionally, while Airbnb rental data is not available. However, this property type can still be a lucrative option for investors in the Nashville real estate market, as well as in any other housing market. Although multi family properties usually cost significantly more than single family homes, townhouses, and condos because of their larger size, they are cheaper per square foot. Moreover, they provide property investors with an easy opportunity to scale up their rental business by buying multiple housing rental units in the same location. Coupled with hiring a professional property manager, buying a multi family home can be a passive, money-making real estate investment strategy for any investor, regardless of his/her level of experience.

Why Investing in Foreclosures in Nashville

Buying a foreclosed property to rent out in the Nashville housing market constitutes a very profitable real estate investment strategy. First of all, foreclosed homes for sale in Nashville are 46% cheaper than other Nashville real estate listings as they sell at below market value, which makes them an affordable and ideal solution even for beginner real estate investors who are usually on a tight budget. Second, because of the low sale price, foreclosures offer a much higher return on investment, whether used as short term rentals or long term rentals.

Important Stats for Nashville Real Estate Investors

Safety

Crime Rate Index: 5 (100 is highest)

Nashville is safer than 5% of US cities only, with a high overall crime rate of 52 crimes per 1,000 residents.

Access

Walk Score: 28
Transit Score: 24
Bike Score: 25

In summary, Nashville-Davidson is the 48th most walkable large US city. The city has minimal public transportation and few bike lanes. Nashville is a car-dependent city as running most errands requires a car.

Affordability

Cost of Living Index (Excluding Rent): 68
Rent Index: 47
Cost of Living Plus Rent Index: 58

The Nashville cost of living index excluding rent is 32% cheaper than in New York City. Rent is 53% less expensive than in NYC. Meanwhile, the average cost of living in Nashville, TN plus rent index is 42% below the level in New York City.

Real Estate Taxes

Davidson County Property Tax Rate
- Urban Services District Tax Rate: 3.155% of assessed value
- General Services District Tax Rate: 2.755% of assessed value
- Average Effective Property Tax Rate: 0.97%

Nashville real estate taxes are affordable and do not constitute an obstacle for property investors. In the Nashville housing market property taxes are paid on the assessed value of the property which is calculated as 25% of the appraised value for residential properties. Generally, the State of Tennessee ranks the 11th lowest in the country for median annual property tax at $1,088.

If you’d like to invest in states with no property tax, check out Hawaii, Alabama, Louisiana, West Virginia, and Wyoming.

Nashville Real Estate Market: Traditional Rentals

Average Monthly Rental Income: $1,760
Average Cap Rate: 1.9%
Price to Rent Ratio: 21
Renters’ Percent of Population: 48%
Optimal Property Type: Townhouse or single-family home
Optimal Number of Bedrooms: 3 and 4
Traditional Rental Listings: 2,732
3 Best Neighborhoods for Traditional Nashville Rental Properties: Elizabeth Park, West End Park, and Capitol View
3 Worst Neighborhoods for Traditional Nashville Rental Properties: Historic Old Hickory Village, Music Row, and Hidden Hills

In 2019 the Nashville real estate market is solidifying its position as one of the best locations for investing in traditional rental properties. The high price to rent ratio and the relatively high proportion of renters (48%) compared to homeowners (52%) lead to a strong demand for long term Nashville, Tennessee rental properties. This is one of the two most important factors to assure a high return on investment with the traditional rental strategy, the other one being the relatively affordable Nashville real estate prices. The average city-level capitalization rate for traditional rentals reaches 1.9%, which is significantly more than what other top real estate markets offer in 2019. Needless to say, this is only the city average value, while some neighborhoods in Nashville offer a much higher return. Single family homes dominate the local housing market, and they also constitute one of the two best property types for buying a house in Nashville to rent out on long term basis. The optimal property type is townhouses. Nashville, TN homes for sale with 3 and 4 bedrooms bring the highest cap rate and cash on cash return.

Landlord-Tenant Law and Regulations in the Nashville Rental Market

The rights and obligations of Nashville real estate investors and landlords are regulated by the Tennessee Landlord-Tenant Laws. Generally speaking, the Tennessee legislation favors neither landlords nor renters but is rather neutral, securing the rights of both parties. In specific, while there is no limit on the amount of security deposit which the landlord can charge, there are some other restrictions on this item which must be returned within 30 days after a tenant moves out. In terms of eviction, a landlord in the Nashville real estate market usually has to go to court to get a tenant evicted and has no right to change locks or lock off utilities to force the renter to leave. Instead, if the tenant has failed to pay rent on time, the landlord should give him/her a 30-day notice to move. If the renter did something dangerous in the property, he/she can be given a 3-day notice to leave. As there are many other details regarding the rights and obligations of Nashville landlords, anyone considering buying a rental property to rent out on long term basis in Music City should study further the local laws and regulations imposed by different government agencies.

If you’d like to explore the real estate investment opportunities in the most landlord friendly states, check out traditional rental properties in Arizona, Texas, Indiana, Florida, and Colorado.

Best Nashville Neighborhoods for Investing in Traditional Rentals

Nashville Real Estate Market Report 2019 Best Nashville Neighborhoods for Traditional Long Term Rentals

1. Elizabeth Park

Median Property Price: $254,000
Average Monthly Rental Income: $1,580
Average Cap Rate: 3.5%
Walk Score: 59

The Elizabeth Park neighborhood ranks as #1 among the best neighborhoods in Nashville for owning a long term rental. Nashville, Tennessee real estate data shows that this area generates the highest return on investment for traditional rental properties. Buying an investment property in Elizabeth Park costs an average of 42% less than elsewhere in Music City, which makes it one of the most affordable areas for beginner real estate investors. While this is a suburban neighborhood which offers lots of restaurants, coffee shops, parks, and other amenities, it is located close to the Downtown Nashville real estate market. As many as 69% of the residents rent, so demand for traditional rentals is strong.

2. West End Park

Median Property Price: $670,600
Average Monthly Rental Income: $2,550
Average Cap Rate: 2.7%
Walk Score: 78

The West End Park neighborhood is second on the list of the best Nashville, TN neighborhoods for investing in a rental property traditionally. This area is considerably more walkable than the rest of Nashville and is home to Nashville Farmers’ Market. However, real estate investors need to keep in mind that buying an investment property in West End Park costs about 54% more than elsewhere in the city. So, if you are a niche investor looking for luxury homes for sale in Nashville, TN, this neighborhood is the right place to start your property search. Despite the high real estate prices, this area offers one of the highest returns on investment for Nashville landlords.

3. Capitol View

Median Property Price: $291,700
Average Monthly Rental Income: $1,500
Average Cap Rate: 2.4%
Walk Score: 30

The Capitol View neighborhood ranks as #3 among the top neighborhoods of Nashville for long term rental properties. This is a multi-use urban district in the heart of downtown Nashville hosting multi family homes, offices, retail shops, restaurants, and an urban activity park. Moreover, this area is relatively affordable with a median property price of 33% below the city level. Buying an investment property in Capitol View is perfect for those investors interested in multi family residential buildings in specific. The return on investment is one of the highest in the Nashville real estate market.

4. Poplar Creek Estates

Median Property Price: $422,900
Average Monthly Rental Income: $2,100
Average Cap Rate: 2.3%
Walk Score: 26

Poplar Creek Estates is not only one of the best Nashville neighborhoods to invest in a traditional rental property but also ranks as #5 among the best neighborhoods in Nashville to live in with a livability score of 81. This is also one of the safest neighborhoods in Nashville, which is always a positive signal for real estate investors. One thing property investors should keep in mind, however, before investing in a rental property in Poplar Creek Estates is that most residents are homeowners, so rental demand might be somewhat weak. This is because the Poplar Creek Estates neighborhood is a real estate development of custom-built homes on oversized lots. Overall, this is a quiet neighborhood ideal for nature and outdoor activities.

5. Hillwood Estates

Median Property Price: $624,000
Average Monthly Rental Income: $2,310
Average Cap Rate: 2.2%
Walk Score: 6

Hillwood Estates is another of the best neighborhoods in Nashville for owning a long term rental property. Despite the higher real estate prices here, traditional rentals are able to bring a high return on investment. The Hillwood Estates neighborhood is able to attract young professionals with the good employment conditions including a low unemployment rate, a high income per capita, and a high median household income. Nevertheless, before buying an investment property in Hillwood Estates, Nashville real estate investors should investigate the rental demand carefully as the homeownership rate is rather high in this neighborhood.

6. Croley Wood

Median Property Price: $390,600
Average Monthly Rental Income: $1,900
Average Cap Rate: 2.2%
Walk Score: 35

Croley Wood is the last location on this list of cool neighborhoods in Nashville to own a traditional rental. Real estate prices in the Croley Wood neighborhood are below the median city level, which makes this area a good choice for beginner real estate investors who don’t have many financing options. Buying a rental property in Croley Wood can result in a very profitable real estate investment if you conduct careful property search and use the best investment property analytics tools to choose a top-performing rental.

Nashville Real Estate Market: Airbnb Rentals

Average Monthly Rental Income: $3,960
Average Cap Rate: 6.3%
Average Occupancy Rate: 62.1%
Optimal Property Type: Single family home or townhouse
Optimal Number of Bedrooms: 4 and 3
Airbnb Rental Listings: 6,301
3 Best Neighborhoods for Airbnb Nashville: Haynes Area, Hadley Park, and Cayce Homes (MDHA)
3 Worst Neighborhoods for Airbnb Nashville: Melrose, The Gulch, and Dalemere Area
Airbnb Nashville Legal Status: New non-owned occupied Airbnb rental permits are issued in non-residentially zoned areas only. New owner-occupied short term rental permits are issued everywhere. Annually renewable permits are required. City and state business, sales, and hotel occupancy taxes are paid.
Annual Events in Nashville with the Highest Airbnb Occupancy Rate:

- CMA Awards: November

The Country Music Association Awards is one of the biggest parties which have been happening annually in Nashville since 1958. It is a major event for the entire US country music industry.

- CMA Fest: early June

The Country Music Association music festival is one of the top 20 music events in the US. Some of the biggest names in the country music industry as well as many newcomers take part in the series of events in downtown Nashville.

- Nashville Film Festival: mid-April

Founded in 1969, this annual event has been called one of the top five film festivals in the US by the Brooks Institute. The Nashville Film Festival attracts more than 40,000 film fans from far and near for local, regional, and world film premiers.

- Tennessee State Fair: second week of September

This 10-day landmark event was initiated over 150 years ago and features a long series of events promoting education related to agriculture, horticulture, industry, economy, commerce, creative arts, performing arts, and others. This annual event brings together thousands of visitors and participants.

- AmericanaFest: September

The events of this 4-day music festival take place in several locations. AmericanaFest features the top Americana, bluegrass, and country musicians in the US and has been running for 20 years.

- Music City Food + Wine Festival: September

Locally and nationally renowned chefs prove their skills with cooking demonstrations and free food samples. This festival takes place in historic venues and outdoor spaces in downtown Nashville.

- St. Jude Rock ‘n’ Roll Nashville Marathon & 1/2 Marathon: April

Tens of thousands of participants come to Nashville to run the 26.2-mile course which features live music along the way.

Buying an Airbnb Nashville rental property is one of the best real estate investment strategies in the US housing market 2019. The city is not only a major industrial, business, commercial, and educational hub in Tennessee but also a world-class center of the music industry. In addition, it features a number of large annual events including festivals, fairs, and award shows which attract over 15 million visitors per year. From the perspective of a real estate investor, these are 15 million potential Nashville Airbnb guests.

In response to the sharp growth of Airbnb in Nashville in recent years, the city authorities have been attempting to limit the further growth of the short term rental industry in Music City by imposing various Nashville Airbnb regulations. At the moment, Airbnb Nashville rentals are still legal, even if with some restrictions. This is great news for those considering buying an investment property here to rent our on short term basis. Vacation rentals in Nashville offer an excellent return on investment with a cap rate and cash on cash return significantly above what other top real estate markets offer. Local and out of state real estate investors should keep in mind that townhouses and single family homes for sale in Nashville, Tennessee with 3 or 4 bedrooms make for the most profitable Nashville vacation home rentals.

Nashville Airbnb Laws and Regulations

In the last few years investors in many top US real estate markets have suffered from tightening regulations and even restrictions on short term rentals through platforms such as Airbnb and HomeAway. Nashville Airbnb hosts have been subjected to the same kind of policy. The battle between the Airbnb Nashville business and the local authorities started a couple of years ago. As a result, in January 2018 the Nashville Metro Council approved a bill planning to phase out non-owner occupied short-term rentals in residentially zoned Nashville neighborhoods in the next three years. According to the bill, mostly negatively affected were single family homes and duplexes. The bill did not prohibit, however, owner-occupied single family properties, multi family homes, and properties in commercial zones. When the debate reached the House and the Senate, they passed two different bills, which led to a final decision by a conference committee that existing Nashville vacation rentals can continue to be rented out, but a short term rental permit cannot be passed to the new owner when selling a property in the Nashville housing market.

Currently, listing a real estate property as an Airbnb Nashville rental requires the issuing of a short term rental property (STRP) permit. New non-owner STRP permits are issued only in some non-residentially zoned areas, while owner-occupied permits can be issued in residential neighborhoods as well, following some Nashville Airbnb rules. STRP permits need to be renewed annually.

In addition, Nashville vacation home rentals owners need to pay business, sales, and hotel occupancy taxes to the city and the state.

Despite what seems like prohibitive Nashville Airbnb laws and the numerous taxes, the Airbnb rental business continues booming in the Nashville real estate market. The main reason is the high demand from Airbnb guests. Having said that though, investors who are considering buying an investment property in Nashville to rent out on short term basis should check out the regulations in their specific neighborhood and comply with them to avoid problems with the local authorities.

Best Nashville Neighborhoods for Investing in Airbnb Rentals

Nashville Real Estate Market Report 2019 Best Nashville Neighborhoods for Airbnb Rental Properties

1. Haynes Area

Median Property Price: $236,800
Average Monthly Rental Income: $4,860
Average Cap Rate: 16.0%
Average Occupancy Rate: 54.2%
Walk Score: 33

The Haynes Area neighborhood is definitely the location of the best Airbnb in Nashville. The return on investment which this neighborhood offers for short term rental properties exceeds the profit generated by any other area in the Nashville real estate market as well as the majority of other top rental markets across the US. In addition to the high cap rate and cash on cash return, real estate investors are also attracted by the affordable home values, which in 2019 stay at 46% below the city-level average. The expected Airbnb rental income is really high, especially compared to the low prices of Nashville houses for sale in this neighborhood. If you are looking to start a profitable Airbnb rental business in 2019, consider buying a rental property in Haynes Area. But before you do that, make sure to check out the zoning code and the requirements for obtaining an Airbnb Nashville permit in this top neighborhood for real estate investments in Music City.

2. Hadley Park

Median Property Price: $393,000
Average Monthly Rental Income: $6,650
Average Cap Rate: 12.5%
Average Occupancy Rate: 52.1%
Walk Score: 63

The Hadley Park neighborhood is the second of the best neighborhoods in Nashville, TN for investing in an Airbnb rental property. The prices of Nashville homes for sale here are about 10% lower than in the rest of the city’s housing market, while the Airbnb rental income is one of the highest across Music City. This means that Hadley Park offers the second highest return on investment for Airbnb Nashville rentals. This is also one of the good neighborhoods in Nashville in terms of walkability, which is an important attraction for Airbnb guests. If you are looking for a good opportunity to make money in real estate in 2019, think about buying an investment property in Hadley Park to rent out on short term basis.

3. Cayce Homes (MDHA)

Median Property Price: $390,000
Average Monthly Rental Income: $5,530
Average Cap Rate: 11.4%
Average Occupancy Rate: 60.3%
Walk Score: 49

The Cayce Homes (MDHA) neighborhood ranks as #3 among the best neighborhoods for Airbnb East Nashville. Located in the East Nashville real estate market, this is the largest public housing project in Music City, which was built in the late 1930s-early 1940s. Recently the Metro Development and Housing Agency (MDHA) acquired this of the East Nashville neighborhoods from the Federal Government in order to implement some development works. Although this is a low-income area, Nashville vacation homes in Cayce Homes (MDHA) have been able to attract demand from Airbnb guests, so the return on investment on a short term rental in this neighborhood is really high.

4. The Woodlands

Median Property Price: $425,700
Average Monthly Rental Income: $3,910
Average Cap Rate: 10.7%
Average Occupancy Rate: 71.2%
Walk Score: 11

The Woodlands is yet another top Airbnb Nashville neighborhood. While prices of Nashville, Tennessee homes for sale here are close to the city median value, the Airbnb rental income is high enough to provide for an excellent return on investment. Even though this is one of the worst neighborhoods in Nashville with regards to walkability, The Woodlands neighborhood has been able to attract numerous Nashville Airbnb guests as testified by the high Airbnb occupancy rate. Investing in an Airbnb rental in The Woodlands is one of the best real estate investment strategies in 2019.

5. Talbot’s Corner

Median Property Price: $385,600
Average Monthly Rental Income: $5,450
Average Cap Rate: 10.5%
Average Occupancy Rate: 51.4%
Walk Score: 36

Talbot’s Corner ranks as #5 among the top locations for Nashville vacation rentals. This neighborhood is particularly good for beginner real estate investors in the Nashville, Tennessee real estate market due to the fact that median property prices are 12% below the city level. The Talbot’s Corner neighborhood has access to many amenities, so although it is one of the relatively bad neighborhoods in Nashville for walkability, it has been able to attract demand from Airbnb Nashville guests. The double-digit return on investment tells investors that buying a rental property in Talbot’s Corner can be a very profitable real estate investment strategy in 2019.

6. Miro Meadows

Median Property Price: $142,500
Average Monthly Rental Income: $2,340
Average Cap Rate: 9.5%
Average Occupancy Rate: 57.5%
Walk Score: 42

Miro Meadows is the last area on this list of the best neighborhoods in Nashville for investing in an Airbnb rental property. One of the main attractions in the Miro Meadows neighborhood for Airbnb Nashville real estate investors – in addition to the high return on investment – is the really low property prices. Homes for sale in Nashville, TN are listed here for 67% less than the value in the rest of the Nashville housing market. This makes the neighborhood an ideal real estate investing location for both beginner real estate investors and other property investors with limited financing options. If you are looking for a good cap rate for a short term rental property in 2019 and beyond, considering buying an investment property in Miro Meadows. However, don’t forget to check out the Nashville Airbnb regulations in this particular area beforehand.

Investing in Nashville Real Estate: Optimal Rental Strategy

Investing in both Nashville long term rentals and Nashville short term rentals is a profitable real estate investment strategy in 2019 and beyond. Nevertheless, Nashville vacation rentals offer a significantly higher return on investment in terms of both capitalization rate and cash on cash return than traditional rental properties in the Nashville real estate market. Because of the numerous tourist attractions, the strong economy, and the reputation of the capital of Tennessee as Music City, Airbnb Nashville is one of the most booming short term rental industries across the country. The high cap rates, nearly unseen in other top real estate investing markets, are the combined result of excellent Airbnb occupancy rate and good nightly rental rates. The recent introduction of new Nashville Airbnb laws has not been able to curb short term rental activities in the city to a significant extent, but new Nashville real estate investors, especially those out of state, should study the existing legislation carefully to make sure that their Airbnb business complies with all the rules and regulations.

Alternatively, if you prefer the traditional rental strategy, you can also find profitable real estate investment opportunities in the Nashville housing market. Make sure to focus your property search on the top Nashville neighborhoods for long term rentals, and don’t forget to check out foreclosed homes for sale in Nashville, TN. This strategy will help you push your return on investment from the beginning.

Why You Should Invest in Real Estate in Nashville, TN in 2019: The Pros

The reasons why you should buy a Nashville investment property in 2019 are numerous. One of the most important ones is the fact that the Nashville real estate market has been ranked as #5 among the Markets to Watch by such a prestigious real estate and financial company as PwC. The trust which the PwC experts put on Nashville results from the recent Nashville real estate market trends and the Nashville housing market for the next few years.

Another major factor for Nashville real estate investing is the fact that Music City is turning into a buyer’s market, which is not the case with most US housing markets at the moment, the majority of which are a seller’s market. With 1,267 Nashville real estate listings, local investors will be able to find and choose the most profitable investment property matching their criteria and expectations without entering into bidding wars with other property buyers. After all, buying a rental property at a good price is the first step towards a successful real estate investment.

Thirdly, rental demand is strong for both strategies in the Nashville rental market. The fact that nearly half of Music City’s population rents rather than owns a home means that investors in long term rental properties can make money from real estate in the years to come. Moreover, the 15 million tourists who come to the capital of Tennessee each year create the right environment for the proliferation of the Airbnb Nashville rental industry. Despite the recent introduction of new restrictions on Nashville short term rentals operations, they are still a feasible real estate investment strategy as long as investors study carefully the rules and follow them.

Last but not least, real estate investing decisions should be based on real estate data, real estate market analysis, and investment property analysis. Analysis of the property investment opportunities in the Nashville real estate market shows potential for high return. The capitalization rate for traditional Nashville rentals exceeds what most other best real estate investing locations offer in 2019. Meanwhile, the cap rate for Airbnb Nashville rentals is one of the highest nationwide, especially among major cities.

All in all, if you want to make money in real estate with rental properties in 2019 and beyond, know that the Nashville real estate market is one of the absolutely top choices for both long term and short term rental properties. To make buying a profitable investment property easier, consider hiring one of the best Nashville real estate agents.

Why You May Not Want to Invest in Real Estate in Nashville, TN in 2019: The Cons

While overall the Nashville housing market offers excellent investment opportunities, there are a few things which investors should consider before making their final decision. One of them is the high crime rate in Music City, particularly in some Nashville neighborhoods. This means that Nashville landlords as well as Nashville Airbnb hosts need to pay special attention to the safety of their investment property and install more security systems and devices than investors in other US housing markets. Nonetheless, the high profitability of a Nashville rental property makes these extra costs worth it at the end.

Furthermore, the newest Nashville Airbnb laws are imposing some important restrictions on hosts, especially those of non-owner occupied short term rental properties in residentially zoned neighborhoods. This means that if you want to get a new Airbnb Nashville permit for such a property, this has to be your primary residence. Nevertheless, the rules introduced by the Nashville local authorities are not as bad as those in the New York City real estate market, the San Francisco real estate market, the Las Vegas real estate market, or the Santa Monica real estate market.

Nashville Real Estate Market Forecast

The Nashville real estate market 2019 and beyond offers a very positive outlook. The growing economy, the low unemployment, the high population growth, the demand from investors, and the local and foreign capital lead to a strong, stable housing market which is only expected to grow. New construction is on the rise, which helps meet investors’ demand, avoid a hot seller’s market, and prevent bidding wars where new real estate investors are always at a disadvantage. A Nashville housing market bubble is also not on the horizon. Based on current and expected Nashville real estate trends, investors can proceed with confidence with buying a rental property to rent out on short term or long term basis in Music City.

Additional Resources for Investors in the Dallas Rental Market

Best Nashville Investment Properties

With the help of an investment property calculator, you can search through the 1,267 homes for sale in Nashville, TN and filter the ones which meet your criteria such as budget, property type, optimal rental strategy, and expected return on investment in a matter of minutes. A heatmap tool will provide you with a map of Nashville neighborhoods to figure out the best Nashville neighborhoods to invest in rental properties as well as the Nashville neighborhoods to avoid for real estate investments. A Property Finder will help you find the best Nashville investment property depending on your preferred rental strategy and other preferences.

Nashville Real Estate Agents

If you are a new real estate investor or an out of state investor or you simply prefer passive real estate investing, you should hire one of the best real estate agents in Nashville, TN to help you find a property and close the deal.

Here are Mashvisor’s top Nashville real estate agents:

House Auctions in Nashville

If you would like to invest in foreclosed homes for sale in Nashville, TN, you can check out this calendar for auctions as well as other foreclosure related events in Tennessee.

Property Management of Long-Term Rentals

Investing in traditional Nashville rental properties doesn’t have to mean becoming a landlord and dealing with all the daily work associated with it. Instead, you can hire a professional property manager to deal with all your duties and responsibilities, while you enjoy your passive rental income.

Property Management of Short-Term Rentals

If you want to turn your Nashville vacation rentals into passive real estate investments, choose one of the top property managers in Music City to handle all responsibilities related to owning and renting out an Airbnb Nashville property.