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Housing prices should rise in 2012 for more expensive homes, Dick Leike, co-founder of Crye-Leike , Middle Tennessee's largest residential real estate firm, said today in the company's annual Nashville meeting.
That's due to dwindling inventory, which will put pressure on prices to increase.
"If you look at Nashville and Memphis, there is not much new homes going up," Leike told a crowd of real estate agents. "The homes that are going up are in the bottom tiers— the under $270,000 range. We are getting skinny in other areas in the upper price ranges, especially in the $400,000 to $750,000 price range."
At the end of 2011, housing inventory in the Nashville area was 17,216, down from 19,411 a year ago, according to the Greater Nashville Association of Realtors . The supply of residential homes is about seven months for single family homes and about eight months for condos.
"As a matter of fact, inventory is down to levels not seen since about this time in 2007," said GNAR President Kendra Cooke in a press release last week.
Leike is upbeat about the year ahead.
"I think we are definitely turning the corner now, we are on the upswing," Leike said. "I think 2012 can be a heck of a year."
As the economy improves, demand for housing will build due to job growth and low mortgage rates, Leike said.
Nashville's housing market ended 2011 on a high note. For the first time since 2006, home sales were up last year compared to the year prior. Nashville-area home sales ended 2011 up 1.8 percent.
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