'Nashville's real estate boom is creating a frenzy among developers and exorbitant prices for residents.'

The construction boom in Nashville is in full swing. Housing is becoming less and less affordable in the area. While the music industry has always been close to Nashville, other sectors are moving in and buying commercial space.

This story is part of CNBC's new quarterly series Cities of Success, which explores cities that have become business centers with an entrepreneurial spirit that has attracted capital, companies and jobs. Nashville residents say they barely recognize Nashville's city skyline, and they probably won't recognize it for a long time, as cranes still clutter the view.

The construction boom in Nashville continues in full force despite higher interest rates, more''high housing prices and a weak national economy. It began long before the mass migration from big cities to more affordable and smaller cities. During the Great Recession after the 2008 financial crisis, workers sought a suburban feel with cheaper housing. At the time, that was Nashville.

"We had a big change after 2008-2009. We had a huge boom that happened in Nashville and gained steady momentum until the last three years," said John Eldridge, CEO of E3 Construction Services, a homebuilding company operating in the area.

Eldridge started building in Nashville in 2008, when most of the nation's homebuilders shuttered underground after one of the worst crises in the history of the construction market. В''Within just a few years, the Nashville market has suddenly grown due to an influx of buyers from the coasts looking for more affordable housing.

The number of building permits for single-family homes rose nearly 25 percent in 2015 from the previous year, triple the growth nationally, according to John Burns Research and Consulting. Eldridge told CNBC that he's still trying to just catch up with that boom.

"We don't have any homes in inventory right now that have been built, completed and have not been sold," Eldridge said.

Demand for homes in Nashville fell a bit in the early years of the Covid-19 pandemic, but the city in October ranked as one of the top destinations for homebuyers looking to relocate to a new metropolitan area, most of whom are coming from''cities.

"I knew I wanted something bigger and more lively after college, especially being in my early 20s. I knew I would want a lot of other young people around and a more vibrant nightlife, and I knew Nashville would offer me that," she said.

Although she lived with a roommate initially, Cartularo then moved into an apartment downtown and pays about $1,600 a month in rent.

"I think that's a lot. I think it's unacceptable.

If renting seems out of reach, so does buying a home. While housing prices across the country''ve increased 47% since the pandemic began, prices in Nashville are up 55%, according to ICE Mortgage Technology. It now takes 44% of the median family income in Nashville to buy a home, well above Nashville's long-term normal of 23%.

Of the 50 largest housing markets in the U.S., Nashville ranks 41st in affordability, according to ICE.

"We are seeing home prices and rents becoming too high and unaffordable," Eldridge said. "We're also seeing a cost shift, a difference in development and construction costs, with Nashville's growth, from land acquisition to building materials, and it's only been going up for ten years now. "

Business is booming

Higher interest rates have made construction''of employees returning to the office,'" she said.

It's not just offices coming back to offices, but new types of tenants are coming in.

"We have music and entertainment, and that's certainly part of our history and our culture. But we're seeing a lot of professional services: law firms, banks, technology, automotive and health care," Gallagher added.

Because of this, developers are also building more high-rise residential buildings downtown, as well as retail stores and restaurants to serve everyone. Nashville's economy may be thriving, but some say the growth has happened too fast, and the city is now paying the price.

"I think for most of us who have lived in Nashville for a long time, the traffic congestion and traffic problems are much''more than ever,'" Eldridge said.

Developers like Eldridge are putting in water and sewer lines, but the city lags behind in transportation infrastructure. Last April, Tennessee Governor Bill Lee signed the Transportation Modernization Act, which includes a $3.3 billion investment to accommodate the state's record population growth.

Watch "Cities of Success," a program on Nashville, on CNBC on Dec. 6 at 5 p.m. ET.