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VOL. 44 | NO. 13 | Friday, March 27, 2020

Census: Nashville’s growth mostly downtown, near Rutherford Co. line

Growth more widespread in Rutherford, Williamson counties

By Hollie Deese

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As Middle Tennessee begins collecting data for the 2020 U.S. Census amid a global pandemic, numbers released earlier this year show Davidson County grew by nearly 46,000 people between 2013 and 2018, a larger gain than any other county in Tennessee.

But an analysis from Middle Tennessee State University shows most of that growth was in a relative handful of tracts either downtown or along the border with Rutherford County.

Countywide, 80% of tracts saw no significant change in population.

“Most people know that the Nashville area is growing, but probably fewer realize how patchy that growth is,” says Ken Blake, a data journalism professor in MTSU’s School of Journalism and Strategic Media, who produced the analysis using figures released in December by the U.S. Census bureau’s American Community Survey.

“Tract-level growth patterns matter, though, because they can end up influencing things like where local governments decide to build new roads or add new schools,” Blake adds. “They also can show where tree canopies and green spaces are disappearing, and they can hint at which areas might grow next.”

Where the next wave of growth is going to be is crucial for construction companies, even given the current financial crash stemming from the COVID-19 virus.

Blake says Rutherford and Williamson counties, which posted the next two largest population gains in the state, grew more uniformly, adding 37,721 and 29,713 residents, respectively. Almost half of Rutherford’s 49 tracts saw significant growth, most in the county’s western half. Growth was more evenly distributed in Williamson, where 57% of the county’s 37 tracts showed significant growth.

Shelby County, long the state’s most populous county and home to Memphis, gained 4,086 residents for a 2018 total of 937,005. Davidson remains the state’s second-largest county, with 684,017 residents.

Statewide, eight counties – Davidson, Rutherford, Williamson, Knox, Montgomery, Hamilton, Sumner and Wilson – each gained more than 15,000 residents since 2013, data show. Nearly all tracts in the counties examined registered some degree of population change in the census data, Blake notes.

Tifinie Capehart, a Realtor with Parks West Nashville and land use consultant, is seeing the same patchy development that still continues to move Nashville’s growth forward, including in the Trimble neighborhood next to Chestnut Hill, and development near Lafayette and Murfreesboro Roads.

“There’s some new construction popping up over there,’’ she says. “There’s pockets of new construction going on just North of Trinity Lane, in Alpine Circle. And people have been building along the river with Trinity Lane on the South side. And the North side, there are some pockets of new construction over there.”

Capehart says one reason is that land costs are typically 20%-30% of the total cost of the new build, so developers like to build in older places where they can get higher sales comparisons.

“You never really have a builder that wants to be the first guy in,” she adds. “I think we’re at a place where people are just having to find land that is affordable to build on. So people are just trying to find those pockets where land costs still allow you to get in at an affordable price and build something that the market’s going to support. Especially if it’s a new pocket.”

Capehart says she doesn’t anticipate that changing with the slowdown from the Covid-19 pandemic either.

“The builder that’s doing our house, he told me they have 20 projects coming out of the ground this spring,” Capehart adds. “I don’t think it’s going to slow down. Because you have people who are going to be rebuilding from the tornado.”

And on top of the regular uptick of the spring building season, Capehart doesn’t see construction slowing down.

“People are still looking for deals,” she acknowledges. “I just think we have to watch our financial system and make sure that people can get financing if they need to. I have buyers ... the thing I’m really trying to monitor is the financial banking system because that’s what’s really going to affect us. Because people are still wanting to buy.”

Even in areas with slower population gains than Davidson, like Sumner, are seeing development in patches as the large tracts of available land disappear.

Jeremy and Erin Riggs own JR Builders in Hendersonville and do much of their custom residential builds in Sumner County, falling in a niche of custom country farm locations and lakefront property, only building in one subdivision the past few years.

“We love the Cottontown area,” Jeremy says. “If you see a chunk of land go up in Cottontown, we bid on it usually. The Cages Bend area and Douglas Bend areas of Gallatin, anything in that area, is gold.”

They say it just keeps getting harder to find land. They get a hot sheet every week from a Realtor but rarely see anything, so they end up doing a lot of the legwork on their own, driving around looking for lots that are for sale by owner. They even stalked a property once that ended up having political signs in the yard, not for sale signs.

“We love to find lots that are not actually in subdivisions but that are in a developed community already,” Jeremy says. “There’s no HOA or anything, so if you can find those lots, you get all of the perks for being in a subdivision without any of the restrictions.”

While they primarily look for land in Sumner – about 90% of their work – they build all over the area, including Davidson, Robertson and Wilson counties, when people come to them with their own lots to build on.

The Riggs have their own team of contractors in addition to sub-contractors, so when natural disasters like the tornado hit, even when it doesn’t strike their own properties, it can still cause delays.

“The roofers for instance, they are very short-staffed as it is, so when we do big houses, we need big crews,” Jeremy says. “And they’re having a lot harder time finding help than before the tornado. Qualified and quality help.”

As for the virus, they have not seen any slowdown yet accept some trouble getting material. One delivery of block was coming from Alley-Cassetty whose main building downtown got hit by the tornado, so they have had to reroute labor there. In addition, many of the drivers are seniors being encouraged to stay home, so there is a driver shortage too.

But to take off work at this point would throw them completely off schedule with homes in various stages of production.

“We try to start a home about every six weeks so we can stagger the same subs on each house,” Jeremy adds. “Luckily, we can dig one, pour one, roof one. It goes in series, and with us doing that, we’re able to scale that up according to the schedule. I think what’s hurt us more this year than the tornado and the coronavirus is all the rain.

“We have had so much rain that we were already at a standstill. We have backlogs of work for months right now.’’

The Riggs even anticipate hiring more people this year in order to take on more work, like renovating Hazel Path, a historic home in Hendersonville, into a wedding venue. But the company could do even more work if Portland, where they used to do quite a bit of building, was able to release more building permits now but are at capacity on existing sewer and septic.

“Our business is mostly custom, so everything that we have on the books for the next year and a half, it’s not going anywhere,’’ Jeremy points out. “Those people have waited on these houses. I do see new construction slowing down to bit, but there’s still such a volume shortage in our area that it may hurt the sales prices, but I still think people are going to be buying, especially with the rates being as low as they are.

“I think the higher-price-point houses are still going to be doing OK. I think that maybe the middle, the $300,000-$400,000, might start hurting a little bit because those jobs are a little bit more insecure.”

David McGowan with Regent Homes says his company builds mainly south of I-40 from Mt. Juliet all the way over to Fairview, Nolensville Rutherford County and down to Huntsville, with about 14 different communities going at any one time.

McGowan has been building in Tennessee since 1988, first with a company called Radnor that he sold to Polk in 1998, and in 2004 he began Regent, this year building close to 500 homes.

He had nothing damaged in the tornado, and the virus has yet to affect anything more than supply disruptions as materials are delayed coming in from foreign markets.

“Some of those ships were quarantined, held offshore for a while,” he notes. “And so things like hardwood floors, laminate floors and light fixtures and things have been held up some, but all things being considered right now, it is flowing and it really hasn’t affected us that bad. What’s really affected us more than anything else is weather.”

With constant rain this spring crews like his have faced a backlog of work, with lots that have been ready to pave since November. Combined with city inspections being pulled due to tornado damage and now the virus, the backlog can last a while.

“It’s not if you can afford it, it is if you can find it,” McGowan says of land. “So it’s really about producing the attainable house, not the affordable house. And the attainable market that’s really strong is under $400,000.

“The millennials, a lot of people thought they weren’t getting married and they weren’t having children, but that was five years ago. Today they are in the market and they are buying, they got the student debt down and so the millennial will probably represent about 50% plus of the buying market over the next four or five years.”

Now, McGowan says they actively target places where they can build a home for the Millennial buyer who either wants a townhouse as they transition from an apartment for maintenance-free living, or to a larger single-family house because they’re planning on having a family.

“We start looking at where can we meet those demands,” he says. “In Williamson County, a 2,500-square-foot house, the fees from the government probably run between $35,000 and $45,000. And then the land cost is $125,000 to $150,000 a lot. Well, you imagine you can’t do that in Williamson County.”

But in Maury County and Rutherford County that is still possible, with two new Regent communities coming online in Smyrna this year, all single-family homes and townhouses. And he isn’t worried about a downturn in the economy either.

“The Nashville economy, the job growth is very strong, and the biggest thing we’ve got to do is produce homes at a reasonable price,” McGowan adds. “We call it the EP ratio, the amount of permits issued versus the amount of employment growth that’s going on. So the EP ratio shows right now that there’s actually a shortage of houses for greater Nashville.”

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