The next big thing in Middle Tennessee

[Craig Lowe]

I am assessing investing in Middle Tennessee for long term rentals and would love your thoughts on where the hotspots are likely to be over the next couple of years. South of Nashville (Brentwood, Franklin, etc) is pretty much already out of reach for rookie investors so would appreciate any insights from the community

[Luka Milicevic]

@Craig Lowe

Welcome to the forums!

Brentwood and Franklin are located in Williamson county which is one of the wealthiest counties in the country. Most of the housing is comprised of class A residential so the rent to value ratios are not going to be great. You would buy there to live or if you just want to own property in the best location possible....

Overall, the long term rental game is rather difficult in the middle TN market right now, especially in the Nashville area. We have had so much appreciation in the last 2 years and rents haven't quite kept up. They have gone up substantially, but not at the same pace as home prices. So, right now we are in a low rent to value ratio in the greater Nashville area. 

In terms of up and coming locations....

If you drop a pin anywhere in Middle Tn it's going to be a "hot spot" in the near future if it already hasn't become one. There isn't a place in the MSA that I would tell you to avoid. 

A few places I'd recommend you look into:

Madison - it has been up and coming for a long time now and I believe there is still going to be a lot of growth here over the next few years. The council person is pushing for developments in the area and so they location as a whole is pro growth. 

Whites creek area 37218 zip code. I didn't like this location a few years ago, even though it was starting to turn. The reason I didn't like it was the lack of commercial that was out there. you had to drive to get anywhere. That is starting to change, and the larger housing developments are starting to move in. 

Dickson - Affordability is a big plus here. Located along I40 - the least congested highway into downtown. A lot of homes here being built at the 350k price point. Again, affordability is the big plus here. There is commercial going in as well, and several larger developments are getting re-developed and revamped at the moment.  

My other location I like at the moment is going to be Columbia TN. The Ultium cells factory is underway there. A partnership with LG and GM to build a factory to produce car batteries. It's really in Spring Hill but right on the border with Columbia. I also like it due to the affordability factor. You can get in sub 300k on a decent property. 

With all the jobs in Franklin and Brentwood, people were pushed south for housing in Spring Hill and Thompson's station. With those two areas exploding and becoming less and less affordable, the next stop was Columbia. All the buyers that I represented that bought houses with me in Columbia all work in the Franklin/Brentwood area. 

I could go on for days, but that's just a highlight of a few places to put on your radar. 

Right now, I'm looking for LTRs in the locations mentioned. Looking to build STRs in Nashville. Renovations anywhere in the Middle TN area. It all depends on what strategy you want to follow. Rates are high...that's the new normal. We need to accept that and make things happen in spite of where rates are right now.

Let me know if you have any other specific questions. 

[Craig Lowe]

Thanks for the insights Luka. Super useful and appreciated.

[Lindsay Davis]

@Craig Lowe,

Welcome to BiggerPockets! @Luka Milicevic makes an excellent point: the Greater Nashville area is tough on rookie investors because housing prices are too high, rents are too low, and it’s hard to find deals that pencil out.

If you’re open to investing in areas outside (but still close to) Nashville, I’d suggest checking out Chattanooga. The median home price per square foot in Chattanooga is about 35% lower than in Nashville, which helps lower the barrier to entry a little.

On that note, we’re personally seeing quite a few deals pencil out in B/B+ neighborhoods within the 37406 and 37411 zip codes.

[Adrienne Green]

@Craig Lowe welcome to BP!  I think @Lindsay Davis is on the right track here.  Many TN investors are focusing on other metro markets than Nashville.  Chattanooga is a great middle TN option.  Some people are going over to Knoxville as well.

[Cara Ledman]

Hi @Craig Lowe and everyone else!

Nashville has grown and gotten more expensive for sure, but as it expands, new areas will prove to be great investments as well. Bordeaux (north of Nashville) is growing as well as Madison, as @Luka Milicevic pointed out. Hendersonville is also becoming a more desirable place to live! South of the city is also expanding- Columbia and Spring Hill have grown immensely and will continue to do so. 

[Jacob Gomes]

Quote from @Craig Lowe:

I am assessing investing in Middle Tennessee for long term rentals and would love your thoughts on where the hotspots are likely to be over the next couple of years. South of Nashville (Brentwood, Franklin, etc) is pretty much already out of reach for rookie investors so would appreciate any insights from the community

Hey Craig!

I'm really bullish on Clarksville.

It's the 5th biggest city in TN, is continuing to grow, has a decent sized university, and has a steady supply of renters due to to it's proximity to fort Campbell. 

Price point is around half of Nashville's but it's going to continue to grow from all my estimations. 

[Kristina Warner]

Hi Craig! Nashville native here. Middle Tennessee has changed so, so much over the past several years. My husband and I started investing before the bottom dropped out in 2008. I work with several investors in this area and I would encourage you to not rule out Franklin & Brentwood. Rookie investors are still able to find great deals in those areas. The key is having all of your financing set up and being ready to move fast! That being said, if you are looking for rental properties it all depends on the type of rental properties you are wanting to acquire. Some investors like the smaller properties, while other investors are going after the larger properties in higher income areas. Some investors also consider school districts. Middle Tennessee has a lot of great areas for rental properties that include Murfreesboro, Antioch, Hermitage, Mount Juliet, Donelson and more. We offer so many options for investors! Good luck in your journey!

[Brandon Combs]

Quote from @Cara Ledman:

Hi @Craig Lowe and everyone else!

Nashville has grown and gotten more expensive for sure, but as it expands, new areas will prove to be great investments as well. Bordeaux (north of Nashville) is growing as well as Madison, as @Luka Milicevic pointed out. Hendersonville is also becoming a more desirable place to live! South of the city is also expanding- Columbia and Spring Hill have grown immensely and will continue to do so. 

 Hey there :) Just curious if you've ever heard about Ashland City being on the rise as well? I'm currently househacking a new build out here and have seen a fair amount of growth in the area (new SFHs, Condos, banks, restaurants, etc...) 

[Cara Ledman]

@Brandon Combs yeah absolutely. We actually just sold two properties up in Ashland City in the last month, so it is growing for sure. Springfield, Ashland City and Pleasant View are all areas that we are seeing more activity and interest in, so it is definitely an area to look into! I'd love to connect and share any properties we get up in those areas.  

[Kristoffer Bergen]

Around Nashville - where do most landlords post their houses for rent? Zillow, hotpads ..??

[David Goodman]

@Kristoffer Bergen zillow, realtracs, and facebook market place. Facebook market place***

[Luka Milicevic]

Quote from @Kristoffer Bergen:

Around Nashville - where do most landlords post their houses for rent? Zillow, hotpads ..??

MLS - Realtracs and then that distributes it to Zillow, Trulia, and all the other big sites.

I stopped posting on FB marketplace. Too many trolls and poor leads. I might revisit next time I have a vacancy but Zillow has been excellent for me. 

[Kristoffer Bergen]

Any solid recos for property managers in Madison, TN? Seems like there are plenty but hard to tell which ones are reputable. Any suggestions welcomed. The biggerpocket tool spit out some recommendations but I like to see actual user reviews and some are too new. Thanks!

[John Williams]

Clarksville, TN - "Where cash flow meets appreciation"

[Chris Allen]

Would love to connect with anyone actively investing in the Nashville area. I might be starting grad school in Maddison and would be moving later this year. From the little I have seen in Maddison, it does not look like an area that I would want to move my family to. But I saw there are some "reasonably" priced new build townhomes and other properties in that location.