Finally, Nashville landlords involved in multifamily can see the light and some core fundamentals are already improving. This includes investment sentiment, as sales surged by 70 percent year-over-year in the first half, with the exact dollar volume unclear, according to a report from Northmarq.
"Almost 70% of properties traded in 2025 were built in 2020 or later, reflecting a clear preference for newer assets," the brokerage said.
In fact, the top three sales involved assets all built in 2021. The largest transaction was property 2010 West End, which traded hands for $112 million. That was followed by Harmony at Mount Juliet and 83 Freight, which sold for $45.96 million and $19 million, respectively.
For the rest of the fundamentals, Northmarq posted data for the second quarter only. Just 12,900 multifamily units are under construction in Nashville, which represents about half the amount underway at the market's peak in late 2022.
Rents experienced a modest 0.6 percent increase to $1,712. Also, that's up 0.9 percent from the previous three months, marking the third straight quarter of rent growth. While vacancy jumped by 90 basis points to 8.1 percent, the category was down from the 8.4 percent recorded in the first quarter. Moreover, the trends bode well for both fundamentals in the short term.
"The recent rent increase coincided with a quarterly vacancy improvement was supported by stronger renter demand in key urban and suburban areas where absorption outpaced new supply," Northmarq highlighted.
"This sets the stage for continued rent growth and declining vacancy in the second half of 2025."
More specifically, Northmarq is forecasting vacancy to finish 2025 at 7.5 percent, which would be down 80 basis points annually. Additionally, Northmarq said that the downward trend should continue after, and by later next year, the segment could return to "historical norms." The CRE firm expects rents to increase by two percent annually to $1,730 per month.
As for deliveries, roughly 9,000 units are expected to hit the market this year, which would mark a 24 percent plunge. And investors will "likely" remain attracted to Class A and B properties, said Northmarq.
"Market fundamentals are expected to continue to be supported by Nashville’s ability to draw residents and employers with its attractive music/entertainment culture and business friendly environment, especially among the healthcare, technology, and hospitality sector," it noted.
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