Fall is our favorite season in Western North Carolina, and the predictable transition of the leaves from green to bursts of color is one of the best parts. Our real estate markets are also going through a predictable transition. After almost seven years of growth, local markets are slowing.
Years of high demand, tight supply, and the resulting price increases have pushed our markets to an inflection point. This isn’t to say that we’re expecting a bubble burst. In fact, all signs point to steady sales and price appreciation. However, the pace and appreciation are likely to be less pronounced.
Beverly-Hanks President Neal Hanks, Jr. has delivered the third quarter 2018 Market Report. Watch the video below or continue reading below for a summation. Keep in mind that the market dynamics addressed here represent our regional trends and are not always evenly represented in each neighborhood. Read the full report or contact your Beverly-Hanks real estate expert to learn more about how your neighborhood is transitioning.
When examining our regional real estate markets, we consider supply of homes for sale, sales pace, home prices, the and the availability of financing.
WNC Supply of Homes
For some time, continued declines in home supplies have been driving trends in Western North Carolina. But in Q3, we recorded the first increases in year-over-year home supply in almost 10 years. The overall supply of homes for sale across our nine-county region increased by 2% over the last 12 months. Even homes priced below $300,000, where the lack of the supply has been most pronounced, increased by 10%.
This increase does not necessarily represent an influx of new homes to the market. Rather, it demonstrates diminished demand as buyers grow less tolerant of the price increases we’ve been seeing.
Want to know how many homes are available where you are? Ask your agent for a print copy of the latest Beverly-Hanks Quarterly Market Report, or download a copy from the Beverly-Hanks Market Research Center.
WNC Sales Pace
Last quarter, an impressive 2,602 homes sold. That amounts to more than 25 homes per day! This figure is also an increase of almost 4% when compared to Q3 2017. Buncombe and Henderson Counties remain two of the fastest selling counties in our area. Both average about 60 days on the market before a property closes. Buyers looking to purchase in these markets must be well prepared and ready to act when searching for a home.
However, unlike recent quarters, it’s important to note that most of the increase in sales last quarter occurred in the brackets above $300,000. The upper end of the housing market—where many buyers have benefited from stock market gains—remains strong. In our region, home sales over $1 million have grown 25%, and we’ve seen nearly 17% growth for those between $750,000–$1 million.
So far in 2018, Buncombe, Haywood, and Madison Counties have reported fewer sales overall. Henderson, Polk, Rutherford, and Transylvania have reported increases. In fact, the Yancey/Mitchell County market reported an impressive 30% increase! Along with Rutherford County, Yancey/Mitchell was the only area to report an increase in sales under $300,000, as well. With improved infrastructure and lack of homes for sale in and around Asheville, buyers are choosing these outlying counties.
Take advantage of current opportunities in the market. Contact your Beverly-Hanks agent before the current demand pushes prices higher and supply lower.
WNC Home Values
The shortage of homes for sale and continued demand are together pushing home values higher. Demand may be beginning to ease as buyers purchasing in the lower price brackets become less tolerant of persistent price increases.
The Federal Finance Housing Agency reported that Asheville MSA’s home prices appreciated 6.7% over the last 12 months. But over the last 90 days, values are up 1.7%. This suggests that prices are continuing to increase, but less rapidly. Local MLS data for the region report a more modest increase of 4%.
Buncombe County’s median sales price continues to lead the region at $300,000. Yancey and Mitchell Counties are the most affordable at $170,500.
To explore the median sales prices for all of our other counties, refer to a complete copy of our latest Quarterly Market Report.
Availability and Cost of Financing in WNC
The availability of mortgage financing always impacts real estate markets. The good news is that financing remains readily available for qualified borrowers and rates remain low.
With the economy booming, a Federal Reserve clearly indicating their agenda, and inflation peeking its head above the water, it’s hard to imagine interest rates going down. But for the time being, rates remain below 5%. The last time rates tipped over the 5% mark was in 2010. With the FED forecasting three rate hikes in the coming quarters, we encourage potential buyers to purchase soon enough to lock their rate before it reaches 5%.
Whether buying your first home or moving up to your dream home, knowing your options will make the mortgage process easier. Contact a Beverly-Hanks Mortgage Services loan officer to learn more.
The Market is Shifting
Our housing markets remain active but appear to be transitioning toward a more modest pace. Steady demand and the shortage of homes will likely cause home values to continue increasing, but at a slower pace.
Those selling their homes still have the edge in 2018. As the sales pace moderates and supply loosens, sellers will start to lose their edge. It is far too soon to call a buyer’s market, but we are heading in that direction. Right now, there are still plenty of opportunities in local real estate markets if buyers and sellers are willing to think creatively. Your Beverly-Hanks agent is a valuable resource for finding those opportunities.
All real estate is local. In order to make confident real estate decisions, we believe it important for you to have timely and neighborhood-specific information. Learn how to find opportunity in today’s dynamic market. Request a Real Estate Review from your Beverly-Hanks & Associates real estate agent.