NASHVILLE, Tenn. (WKRN) — Nashville is projected to have one of the largest increases in new apartment complexes in the nation for 2023, according to a new RentCafe study.
The study ranked Nashville No. 15, in between Seattle and Tampa, with nearly 9,000 projected new apartments this year.
Joel Sanders, founder and CEO of Apartment Insiders, told News 2 he’s never seen apartment growth this active in his 18-year real estate career.
“I feel like I’m back in college and I have to go home with homework every night to get familiar with all this inventory that’s hitting the market,” Sanders said.
There are currently around 37,000 apartment units under construction in Nashville, according to Sanders. The complexes are popping up mainly in central Nashville and around the downtown area, because residential development wasn’t allowed there from 1963 until 1993.
“It’s a totally different world right now, but what that’s created is there are a lot of development opportunities for residential apartments in Nashville around downtown Nashville because it’s not saturated with them,” Sanders said.
Thanks to the healthy supply of apartments, renters are overwhelmed with options, and complexes are in fierce competition to draw residents, according to Sanders. Some property managers are offering as much as four months of rent free to attract renters.
However, Sanders believes if Nashville continues to grow at the same pace, he senses a shift in the apartment market within the next few years.
“We have a good supply coming as of right now to accommodate all of the people that want to become Nashvillians,” Sanders said. “What does concern me is what that supply is going to look like in 2025, 2026, 2027, as developers are pulling back on projects because interest rates have nearly doubled in the past year.”
The RentCafe study also cites the rising costs of land and construction supplies, as well as labor shortages as other reasons apartment development may slow down in the future.
However, many experts expect the pace of construction to gradually recover in 2027 and 2028.