Buying a Home in Nashville? 3 Things to Know

Nashville residents love the food scene, the music vibe (did you know Indie is as popular as Country in Nashville?), the parks, the waterways, the abundance of coffee shops and bars, and our sports teams: the Titans (NFL), Predators (NHL), Sounds (minor league baseball), and (perhaps most exciting right now) the new Nashville Soccer Club.

Businesses find Nashville appealing, too. The region is home to 50k businesses, 15 of whom employee 3k people each, with more to come. With attractive real estate opportunities, easy flights from just about any major city, and access to so many talented people — what’s not to love?

And we have not even gotten to “no state income tax” which is appealing to natives, long-time residents, and new arrivals alike.

If you’re considering moving to Nashville for a job, to open a business, to experience a different life, or if you just want a change of scenery while working remotely, there are at least 3 things you should consider if you’re thinking about buying a house.

#1 – Your Commute

How much time will you be spending in your car? 

(Hint: We have quite a bit of traffic combined with a public transportation system that is…how do we say this? Incredibly lacking. So it could be a lot.)

As with almost any metro area, your commute depends on what part of town you live in, where you are driving, and what time you are on the road. As of 2017, an estimated 50% of Middle Tennessee workers crossed a county line on their daily commute. Nashville/Davidson County can be approached by three interstates (24, 40, 65) and innumerable surface streets that enter from Williamson, Wilson, Rutherford, Cheatham, Robertson, and Sumner counties.

In a nutshell — there’s a lot of people going places.

Interestingly, a recent study found Nashville to be one of the few cities to see more traffic to its downtown area post-pandemic than pre-pandemic. 

This should not be surprising since a March 2021 report found Nashville to be the 44th most traffic-congested city in the world. And the additional 200,000 new residents expected in the next five years, while welcomed (by most of us) will not help things move more quickly.

The public transportation consists of a local bus system and the Nashville Star, a train that services four stops between Nashville and Lebanon on workdays. So if you’re coming from a larger metro area where car ownership was not a necessity, you might be in for a rude awakening. Our city actually has the 2nd highest rate of car ownership of the 50 largest US metro areas.

So what? Public transportation (or the lack thereof) can affect your decision-making in two ways:

1. If you do not want to own a car, will you live closer to or in downtown? How will you get around when you have a meeting across town? What about when you want to take a day trip?
   
   
2. If you do want to own a car, what kind do you want to own given your expected commute?
    

These questions affect whether you need an automobile insurance policy. And the county you call home, the length of your commute, and your total number of annual road miles will all affect your rates.

#2 – The super hot real estate market

Will your insurance cover rising market values and construction costs?

The recent surge in housing prices nationwide did not skip Nashville. In fact, Nashville may have preceded it. Housing prices in Nashville have been steadily climbing for several years, driven by the influx of new residents mentioned above that has contributed to an ongoing shortage of single-family homes in the area. 

This chart shows prices beginning to climb significantly around the end of 2017.

Source

So, for now anyway, the question to ask is not whether buying a home in Nashville is a good investment. The question you really need to ask is whether your home insurance is adequate enough to keep up with a surge in value. Your coverage needs to cover the cost of replacing what you have now; not the cost of what you purchased five years ago.

 At the bare minimum, your bank will require you to cover the amount of your loan. But that mindset protects the bank — not you and your financial future.

 What you really want is to insure the amount of your home for what it would cost to rebuild in the same quality, and in the same location. Don’t let this scare you; replacement coverage is more affordable than you might think.

#3 – The weather

Will you need tornado coverage? What about flood insurance?

Tornados? Are you serious? Yes, unfortunately.

Mark it down to an act of God, climate change, or a punch-drunk El Niño, but the Nashville area has suffered devastating tornadic activity in the last few years. In December 2021 a series of tornadoes ripped areas to the west and east of Nashville, including a 7.6 mile swath of damage beginning on the east side of Davidson County. Just over a year earlier, a series of t10en tornadoes struck Middle Tennessee causing hundreds of millions of dollars in damages across more than 100 miles. Buildings of all types were damaged.

So, will you need tornado coverage in addition to your regular homeowner’s coverage?

The short answer is no. Tornadoes fall into the category of wind and hail damage, which are both covered by a basic home policy.

However, your insurer may require you to carry a higher deductible if you live in a tornado prone area. What’s more, sometimes tornadoes cause damage indirectly. Like flooding. In those instances, a basic home policy won’t cut it.

Tornados first, now floods, too? Yes, and now more than ever you need to know whether your house is in a flood zone. If it is, you will need flood insurance.

Although no flood in the Nashville area has since reached the devastation of the one in 2010 (dubbed a 1,000-year flood), periodic heavy rains combined with more rivers, creeks, and streams than people realize, Nashville and areas surrounding it are prone to flooding. After flooding last year when scores of people had to be rescued, it was reported less than 5% of Nashville residents have flood insurance. 

In February 2022, FEMA, the Army Corps of Engineers, and Nashville’s Metro Water Services issued updated flood-zone maps. The redrawn maps added more than 1,000 homes to flood-zones. 

A flood zone does not mean you cannot buy a house in that area. It does mean you’ll have to purchase a policy for flood insurance if you choose to buy there.

Last year, we published The Ultimate Guide to Flood Insurance in Middle Tennessee for homeowners and potential homeowners like you. Here’s an excerpt you might not know: