The construction market in Nashville has only seen a small decline overall this year.
It has been buoyed primarily by growth in the residential sector, which is the largest segment of the market by a significant margin. The growth in residential is masking severe drops in both manufacturing and commercial construction, which are down 19.9% and 19.8%, respectively. Nashville’s construction market will feel the impact of the recession and pandemic more strongly next year, with the residential sector dropping 15.7% alongside a further 10.1% decline in the commercial sector. Overall construction will be down 9.1% in 2021. The rebound will come in 2022, with total construction volume rising 4.7% and growth predicted in every sector.
Construction employment in Nashville has held steady this year, which, combined with the minor decline in construction volume, should push prices slightly down. Escalation is expected to hold roughly steady this year as the total labor market’s slight downward pressure is counteracted by continued shortages in specific trades and by disruptions to global supply chains. Next year’s drop in construction activity will put stronger downward pressure on prices and will help hold escalation in check until the market rebounds in 2022.