Last month I talked about investing through your retirement accounts in rental properties. That as an investment, real estate can produce three things – appreciation, cash flow and tax advantages. Most of Nashville’s and surrounding area real estate will appreciate over the next several years if the expected growth is anywhere near the predictions. But some areas will appreciate faster than others and those are emerging and edge neighborhoods.
It’s hard to drive around Nashville and surrounding areas these days without seeing a changing landscape, buildings and houses being torn down and new ones taking their places. It’s hard to keep up with it all.
And in the news you hear about this emerging neighborhood or the next – Sylvan Park, The Nations, Wedgewood Houston, Sylvan Summit and Cleveland Park are names that get bandied about. So what is an emerging neighborhood and what does it mean. I am sure there are a lot of definitions but mine is a neighborhood where there is a shift in its ‘culture’ – housing stock that is being renovated or rebuilt, safety increasing, services and amenities that are growing and changing- there is a new feeling about the neighborhood.
So with my definition Sylvan Park is past emerging, not that there is not new construction there but its small percent of the total housing stock. And the neighborhood has really not changed recently, improved yes but not substantially changed. When you drive through The Nations it’s hard to say if it’s crossed the line into established with over half the housing stock newly constructed homes and with several new restaurants in the area. It has substantially changed over the last few years but the changing is slowing down, a new ‘vibe’ is already there.
Wedgewood Houston has seen a lot of construction over the last few years and has seen businesses and restaurants move in. It already has a monthly art crawl due to the number of galleries that are there. But a lot of the area is still covered with light industrial or vacant buildings. Major change is slated however with condo developments in the pipeline. This neighborhood will emerge quickly in the next year. Though housing prices, due to the limited stock of properties, are already fairly high. It’s emerging ‘vibe’ as an artist community will continue to strengthen.
Cleveland Park and McFerrin Park in East Nashville are other emerging neighborhoods. At least a third of the houses are renovated and new. A new boutique opened recently as well as a restaurant. Big changes are slated for Dickerson Pike and due to its ideal location just minutes from downtown, the Titans, 5 Points and other hot spots in east Nashville, and Germantown, the Sounds and the Farmer’s Market, it is ideal for downtown workers. There is still opportunity there but it is changing fast.
Because East Nashville is ‘happening’, development is moving not just across Ellington Parkway to Cleveland Park and McFerrin Park but also to the edge neighborhoods of Highland Heights and Capital View to name a few. Madison is also feeling the impact as people are priced out of East Nashville and need to move further north to find affordable housing. An edge neighborhood being a neighborhood that is impacted due to its proximity to another neighborhood where change is happening.
Sylvan Summit is another great example of an edge neighborhood. Sylvan Summit is north of Charlotte, just west of I-440. Sylvan Heights has long been home to modern construction with great downtown views but with less and less property available to continue building like houses, developers had to jump across Charlotte to find available land. For many years Charlotte was a very clear boundary between “good” and “bad” neighborhoods. No new amenities has been added in the Sylvan Summit area such as restaurant or shops but its proximity to those that have popped up on Charlotte in Sylvan Park and Sylvan Heights has made it desirable.
Another edge is just over the interstate, west of Germantown into North Nashville. You can see new construction and renovation taking place on N 9th, Arthur and surrounding areas. In fact most of North Nashville is starting to experience change as it growth moves from the west, the east and the south. As a core neighborhood of Nashville it’s long overdue for being embraced by the city.
The earlier you invest in emerging or edge neighborhood the greater your appreciation will be. For those that purchased their home in The Nations in 2012 and 2013, they have seen enormous growth in their home values. And those values will continue to rise but not as fast as they have over the last few years. So if you’re ready to invest, look at the emerging and edge neighborhoods for the greatest appreciation.
If you’re ready, let me introduce you these areas and more.