Analysis: Buyers need 42% more income to afford average Nashville home for sale

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Posted at 5:10 PM, Jun 14, 2022
and last updated 2022-06-14 19:59:06-04

NASHVILLE, Tenn. (WTVF) — Realtor Santana Jones sees it every day — homes selling well over asking. Why? Because they can.

"I'm getting a lot of emails about 'highest and best,' and sometimes that highest and best is $50,000, sometimes $100,000 above," said Jones.

Homes are selling well above what they used to, which is why buyers also need to make more than they once did.

"It's kind of hard to live in a certain area right now and get paid the same amount of money," said Jones. "So if you're still making the same amount of money without a raise, then you might have to consider the outskirts."

Recent data shows Nashville buyers need 41.8% more income than last year to afford the average home. Back then, interested buyers had to earn at least $56,155. This year you have to earn $79,618 to afford the median home for sale.

It comes as buyers are feeling the effects of rising interest rates.

"The rise of the interest rates is meant to fix the market, correct the market and it's working because what I'm seeing a lot in my inbox is price reductions and homes sitting a little bit longer than they usually do," said Jones.

But that doesn't mean home-buying will be any easier for those in the market.

"Inventory is low and we don't foresee that changing any time soon and with interest rates rising at least three more times this year it's still going to be a challenge," said Jones.

Still, he urges buyers not to lose hope. Jones says refinancing is always an option in the future for those looking to buy now.