When people say real estate is “political,” they often picture partisan arguments or catchy slogans. But those aren’t the things that impact your bottom line.
What truly shapes the real estate business are economic conditions, regulatory environments, and public influences. These factors affect mortgage rates and affordability, market supply and demand, buyer and seller psychology, and investor behavior.
So, while real estate itself isn’t political, your business definitely can be shaped by larger structural forces. Let’s look at how today’s economic and policy forces are shaping real estate, especially in Nashville.
One of the biggest changes agents have seen in recent years is the shift from ultra-low rates to what many now call the new normal: around 6% or higher.
Currently, the average 30-year mortgage rate is about 6.1%. That’s a bit lower than recent peaks, but still much higher than the 3% to 4% range from earlier this decade.
This matters because buyers feel higher rates even before they see them, and monthly payments eat up more of household income. Many buyers are patiently “waiting for rates to drop,” which slows transaction volume.
When rates go up or down, it’s not by chance. It happens because of broader economic conditions and monetary decisions. Your business feels the impact when rates rise, and it also suffers when buyers wait. This is a market reality with real economic effects.
Affordability Isn’t Just a Buzzword… It’s a Barrier
In Nashville, housing affordability has become a real challenge for our industry.
According to the Federal Reserve Bank of Atlanta’s affordability monitor, a typical household here would need to earn about $138,000 annually to meet the traditional 30% income-to-housing-cost threshold. But the actual median income in the metro area is significantly lower.
So, while many people want to buy, the numbers just don’t add up for much of the local market.
This can be influenced by many factors like mortgage lending rules, interest rates, tax policies, wage growth, and zoning. These forces together decide who can buy and who cannot at a given time.
Market Conditions Have Shifted and So Should Our Strategy
In Nashville, we’re seeing clear signs that the market is returning to normal. Homes are staying on the market longer than they did at the peak of the boom. Buyers have more time to evaluate decisions, and sellers are increasingly open to negotiation. Median sale prices are also stabilizing rather than skyrocketing.
This doesn’t mean the market is getting weaker. We’re now in a balanced market, which calls for different skills than the hot market of 2020 to 2022.
Our business relies on how we understand and adapt to these changes, not just observe them. Institutional decisions shape these conditions, and turning that knowledge into strategy is what sets trusted advisors apart from transactional agents.
So, What Should Agents Actually Do?
First, get informed beyond MLS and lead funnels. Knowing why rates are at their current levels, why affordability gaps exist, and how policies affect markets gives you an advantage when talking with clients. Second, stay informed, especially when it comes to voting. If you’re voting at any level—local, state, or federal—make sure you understand what those decisions mean for housing policy. This isn’t about politics or sides; it’s about understanding your business and the environment it operates in. Lastly, support advocacy organizations. Groups like RPAC and state or local REALTOR® associations do more than lobby. They help shape the laws that affect property rights, lending regulations, land use, and tax policy.
Getting involved isn’t about agreeing with every position. It’s about making sure the real estate industry has a say in decisions that impact your business. The real estate industry doesn’t fit neatly into “red” or “blue” categories. Instead, it is shaped by policy decisions, economic systems, and public priorities.
If you want your business to thrive in the long term, it’s important to see market changes as economic signals, not just random noise. Learn how economics and regulation connect to housing and show clients you understand why the market changes, not just that it does.
Because here’s the bottom line: Your deals may not be political, but your business depends on how well you understand the forces behind them.
Mike Webb is a Nashville-based Realtor and Director of Growth & Development with the LGI team at eXp Realty. With over eight years of experience helping hundreds of families buy and sell homes, he combines his background in IT with a passion for strategy, integrity, and results. Mike also coaches and mentors’ agents nationwide, focusing on building strong foundations and people-first businesses.
