BUY

Buying A Home in Asheville NC Fall 2020

October is one of Asheville NC busiest real estate months.  In the past many people who visit Asheville during the leaf season decide to go ahead and purchase a house while they are here.  Others have been planning to move here for years and finally take that leap of faith.  This year the effects of global warming and the pandemic have caused even more people to come to Asheville. Over the past decade we have seen housing prices climb and inventory slack.  Now we have a serious affordability issue based on our local average household income level.

If you are moving from CA, NY, FL, CO, or a place that has extremely high house prices, and made a large amount from the sale of your property, you may think that you can find a similar house for much less. I often have clients who are sticker shocked based on exceptions rather than the actual price. So is important to be knowledgeable about the area when you get ready to purchase a home.

Asheville, Hendersonville, Waynesville, Marshal, and Brevard have all been long time popular cities due to their great outdoor beauty and ethic art and music venues. Eventually, the people moving here had to expand out to our areas within the counties of Buncombe, Henderson, Haywood, Madison, and Transylvania.

Today, if you want to buy land “to do a mini farm” or to “have privacy” and your budget is below $300,000 you probably will need to look in McDowell, Rutherford, or Polk.  For most people that is not what they were thinking of when wanting to be near Asheville.  Western North Carolina is a mountainous area and there is a limited about of land that is farmable or buildable and that comes with a choice of paying more or moving farther out.

  

 

Many people who move here just want a house and a yard.  They really don’t have a concept between a quarter or one acre really is. Plus, it really depends on where the house sets on a lot as to how big the yard feels.  It is important to realize that the median home price in Buncombe county and the surrounding counties have been climbing at a very fast pace since the beginning of the pandemic. In my most recent, Real Estate Market Update Report, Buncombe county median home price had climbed to $342,000.  That is still a good deal if you are moving from Denver, New York City, or LA.  It might be a big sticker shock if you are moving from other areas.

Another, thing that people looking to buy in the Asheville area need to be aware of is that they must move quickly on a house when they find one, they like.  Multiple offers are occurring in all price ranges. Even houses in the $700K+ are on the market less the 90 days. Bottom line if you are not ready, willing, and able to buy in 90 days you are just looking, because what you liked will be sold or under contract.

The rental market here is also very tight. So if you are planning to rent before you buy, you need to start looking for a place immediately and be willing to put up some money to hold your spot.

I think the most professional thing I can do is to set realistic price understanding at the beginning of our relationship.  Early, in my career I had to do this with first time home owners.  Back then I would say now if you qualified for $400K you could have everything.  Now I have to tell my clients that the $400K cash they have will not buy everything on their dream list. There are homes currently on the market priced between $225K-$275K. They just may not meet your expectation.

Once people understand what their “qualified/willing” amount to spend will buy them, one of two things happen.  Either, they adjust their needs/want list or they come up with more money. Regardless, of the result, I think it is my job to help you as the buyer to come to Asheville with realistic open-minded concept of buying in this area.  This is accomplished by a few steps.  First, you must be pre-qualified or actually have the proof of funds.  We need to know how much you can spend before we can decide what that will buy. Also, most sellers require this before allowing a physically showing.  Second, we make a wish/must have list. I will help you fine tune this before we start looking.  This is important because if a garage is a must then that limits your selection in our area. However, is storage is what is really important then that opens us up to more houses. Third, I’ll create a MLS search engine for you that is in real time and updated daily to ensure the house you like is currently active before we schedule an appointment. It can be so frustrating to like a house that Zillow or Facebook says is active only to find out it went under contract five days ago.  Fourth, I will review houses with you per Zoom so we can fine tune that must/want list. Most of our local sellers require a drive by before requesting a showing.  This is a good way for you to get to know the area and worth doing your first few days in Asheville.  All this primarily work will help you be prepared to make a realistic offer quickly when you find a house you like, hopefully affording the disappointment of not having your offer accepted.

Asheville is a wonderful place to live. The greater Asheville area is also a beautiful place to live. Prices will continue to climb as more and more people move here. Currently the interest rate is low and helps offset the monthly payments, in some cases it may be lower than rent. So if you are even thinking about moving here, now is the time to start taking an active role in understanding this market.  I certainly, don’t want to scare you away from our lovely area, I just want to establish realistic exceptions.  Of course, the best thing to do is schedule a time to talk and we can help you match your exceptions with your budget.  I also have an extensive Realtor referral resource, that will be glad to help you with the surrounding outer counties.

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Common Q & A for Buyers

Buyers usually have many questions about the process of buying a house. Love The Green Real Estate Consulting Firm offers detailed information on our website in the Buy Section and on YouTube. Today we thought we’d answer some of the most common questions.

 

What is the difference between a Realtor and an Agent?

Although both must be licensed to sell real estate, the main difference between a Real Estate Agent and a Realtor is the latter is a member of the National Association of REALTORS®. A Realtor must subscribe to the Realtor Code of Ethics which includes 17 articles. Many consumers only want to work with a Real Estate Agent who has sworn to treat all parties fairly and honestly.

 

When can I start looking at properties?

Several things need to happen before we start looking at properties.  First, if you are getting a loan, you need to meet with a lender (we can recommend some for you) to find out how much you qualify for.  Next, we will meet and talk about the home buying process in NC, and your wants and needs concerning your future purchase. Then you need to provide all the paperwork necessary to be pre-approved.   At this point if you are ready to buy in the next 90 days, then we will start looking at houses.   

 

If I call or email a Realtor about a house I saw online, who is the Realtor working for? 

If you have not signed a buyer agency agreement, the Realtor is working for the seller.

 

Can I work with more than one Realtor? 

It is possible that you may have some part-time or inexperienced Realtors who are willing to show you a few houses without requiring you to sign a Buyer Agency Agreement. However, they may not be working for you – they may be working for the seller.

 

How do I know if the Realtor is working for me? 

You will sign a Buyer Agency Agreement that states the time period and who you are working with. This agent or team will be your contact point for all homes you want to know more about, call for information on “For Sale By Owner” (FSBO) properties, and stay in touch with you.

 

How does a Buyer's Agent get paid? 

Realtors are usually paid on commission at the close of the sale of a house. In most cases, the Buyer’s Agent is paid by the seller as part of the listing agreement. Top professional buyer agents and teams usually request a retainer fee from the buyer since real estate is their full-time business and are not in the learning stage. It is possible for Buyer Agents to be paid by the buyer at the beginning of the search.  This is part of consulting services and is often used by experienced investors.

 

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2020 Real Estate Projections

World and national economics affect the housing industry, so we’ll start with the National Association of Realtors (NAR) forecast, then look at our local market.

Across the nation, there is still a housing shortage, which means new construction will continue to grow. However, new construction costs more than existing homes and we already have an affordable housing crisis. Mortgage rates are predicted to stay low, yet buyers’ wages limit loan qualification amount.

The consensus at the NAR Forecast Summit is that at best, there will not be a recession, at worst, a 29 percent chance.

Markets to Watch According to NAR:

  • Raleigh-Durham-Chapel Hill
  • Winston-Salem, NC
  • Charlotte, NC
  • Charleston, SC
  • Columbia, SC
  • Chattanooga and Memphis, TN
  • Tampa-St. Petersburg, FL
  • McAllen-Edinburg-Mission, TX
  • Dallas-Fort Worth, TX
  • Columbus, OH
  • Fort Collins, CO
  • Colorado Springs, CO
  • Tucson, AZ
  • Las Vegas, NV
  • Ogden, UT
  • Boise, ID
  • Rochester, NY

So what does all of this mean for us? Well, pretty much the same thing.  The greater Asheville region will continue to have an affordable housing shortage. The average sale price for an existing 3 bedroom/2 bath home was $265,000, and $325,000 for new construction.  While these numbers may seem low to people moving into the area from larger cities, our local residents have a current living wage of $13.65 an hour, which makes it almost impossible to buy a house. The same holds true for most of the aforementioned hot markets.

Most buyers will either be second-time home owners or moving here from a large city.  Sometimes, out-of-state buyers are shocked by our prices. Houses $350,000 and under will go fast, so be prepared to make an offer as soon as you find one you like.  If you are looking for a home that doesn’t need any remodeling or repairs, be ready to pay $275,000 or more. Once you are in the price range of $400,000 - $600,00 and above, you have a little more time to make up your mind. That price point stays on the market an average of 50-60 days. The issue is that there is significantly less supply because many of the active listings are new construction and have not yet been built.

All of this should mean good news for sellers. However, the market is shifting.  We have leveled off on extreme price increases. The condition of the house critically affects the price.  No longer can you stick a sign in the yard and get a crazy amount for a pig with lipstick.

Buyers expectations have changed in the past 12 months.  New construction is often the competition, so existing homes need to be in generally good condition and ready to move in.  If you plan to sell your house for more than $275,000, you will need to do some upgrades and repairs.  Otherwise, buyers will be subtracting those improvement costs when they make an offer.

A noticeable trend is that many people are moving more than 20 minutes from downtown Asheville.  More of my clients are stating that they don’t want to live in town due to high prices and traffic. The same is true for Hendersonville.  Towns like Weaverville, Marshall and Mars Hill are becoming attractive due to price point, the sizes of homes and lots, and a “small town feel”.  Another trend is that investors have expanded their “sweet spot” locations to as far as an hour away for their home base.

Ironically, all of this means that it is the prefect time to both buy and sell in the greater Asheville area.  Historically, this area has continued to appreciate at 3+%. This means that house prices will always be going up, so if you want to buy, now is the best time.

For sellers, the factor to consider is that new construction will continue to come online and buyers will almost always buy new construction if the price is the same.  So now is the time to make those improvements and get top dollar for your house.

Real estate is cyclical and change will happen. Eventually, there will be a slow down in the market and interest rates will rise. Right now, 2020 looks like a good year for both buyers and sellers.

View the Real Estate Trend Indicator for Buncombe County for 2019 here.
View the Real Estate Trend Indicator for Henderson County for 2019 here.

If you would like more information about our local market, please contact me at mary@lovethegreen.org.