Now that there’s been time passed since the start of the Covid19 Pandemic shut down, we can more happily discuss the Asheville Housing Market. As time passed, and quarantine restrictions were
Is the Asheville Housing Market Cooling Down?
Dated: May 10 2022
Now that there’s been time passed since the start of the Covid19 Pandemic shut down, we can more happily discuss the Asheville Housing Market. As time passed, and quarantine restrictions were lifted, the cabin fever afflicted population was ready to be one the move. Americans were looking for new jobs and new homes. For those moving to Asheville, North Carolina, homes seemed few and far between, and what little could be found was cost prohibitive. As home prices rose higher and higher, the end seemed to be nowhere in sight. But now, it seems it may be on the decline. Is this true? Is the Asheville housing market cooling down?
Asheville Housing Market
The Asheville housing market hasn’t cooled down yet, it just looks like it has
Even if you aren’t trying to buy or sell a home, unless you’ve been living under a rock you almost certainly know about the current state of affairs in the American housing market.
When the quarantine was lifted, with it came a voracious seller’s market that seemed to ceaselessly climb and climb. Buying a home became nearly impossible. Selling a home made you an instant mini-millionaire. (Well, maybe not quite, but you get the idea.) The volatility of this market seemed to lend no answers as to where it was heading. Or should we say is heading, because no, it hasn’t stopped. It just gives the illusion of slowing down due to a few key factors.
Learn More: What to know about Buying Land in Asheville
Historical norms of the buying and selling process have (temporarily) changed
As the housing market broke out into absolute bedlam, buyers and sellers began to adopt the concept that the tried and true “rules” of buying and selling a home were out the window as well. This quickly came back to bite many a buyer and seller. Even in these unprecedented times, there are still unwavering rights and practices that need to be upheld. For example, many sellers were showing favoritism toward buyers willing to waive inspections. This is something that should never be expected of a buyer; ever. Having the home inspected before a purchase is finalized is a right of the buyer. While you cannot force someone to waive this right, you can put them in an exceedingly difficult situation by prioritizing buyers willing to do so. For some who purchased homes sans inspection, they have found out fast that in waiving that right, they have purchased what can only be described as an albatross. A very expensive one at that.
Speaking of the expense, let’s get this out there, yes; homes have been selling for much more these days. Traditionally, an asking price is just that. What you are asking for. It should more appropriately be called a hoping price, because you’re just hoping someone is willing to pay that amount. But almost always, sellers accept offers below their asking price. Usually sellers even project for this by setting asking prices higher than what they expect to get, knowing it won’t be met. But home-buying-2021 has brought a new contender to the offer game; offering over asking price.
Countless potential buyers have been outbid by other buyers willing to go higher over the seller’s asking price than they are. Sometimes you don’t even get a second chance to give another offer, especially if you’ve been outbid with a cash offer.
Median sales price of single family homes in the Asheville MSA
Asheville’s overpriced homes are sitting on the market for too long
With the exorbitance of buying a home in 2021, many seem to think you can slap a million dollar price tag on your 1973, two bed/one bath single story ranch home and wait for the offers to roll in. Common sense (at least some of it) still stands, even in this market. Homes that are way overpriced are staying on the market longer than those more reasonably priced.
Many sellers have jumped on the SELL, SELL, SELL, bandwagon and found themselves with a home that’s now been on the market so long that they have to reduce the price. That never looks good. No matter the reason, it screams to potential buyers “Something is wrong with this house…but look, just like a dented can of beans at the grocery store, it’s now on sale!”
There might be nothing wrong with this home. But overpricing it in hopes of getting two to three times the home’s value has now left the seller in a position in which even a value appropriate asking price makes the home look sketchy and undesirable.
Number of homes for sale LIVE data tracker
Learn More: 18 Things to Know Before Moving to Asheville
Sold homes are going back on the market
One of the main reasons the housing market is giving the illusion of cooling off is the number of sold homes going back on the market. First of all, they weren’t really sold. Not technically, at least.
There are plenty of steps along the way in the buying process that can leave a buyer desirous of backing out of the deal. The aforementioned pressure to make an offer as soon and as high as they can has left many buyers finding themselves deeper into the process and realizing that for one reason or another, they don’t actually want this home. Often this happens when buyers make an impulse purchase on a home and later find a home they like better, got for a better price, better suits their needs, etc.
After securing the sale on the second home, they back out of the first deal. For many, the couple thousand dollars they lose in due diligence money pales in comparison to actually having a house they like. Is this a good way to go about home buying? No. But it’s happening.
Sight unseen offers are at an all time high, leading to sales falling through
As the panic set in across the country to buy now before homes became even more expensive, more buyers than ever purchased homes they had yet to even see in real life. Sellers and real estate agents employed plenty of innovative solutions to being unable to tour the home, like virtual tours, or letting a relative or representative tour for you. But the bottom line is that nobody knows if you are really going to like the home but you.
The reasons a buyer might back out of a sight unseen purchase are innumerable. Some of the most common in the past year have been factors like size, construction quality appearing better in footage than it actually is, property drawbacks like loud noises coming from nearby or unsightly properties of neighbors, and just flat out cold feet.
It seems like common sense that buying a home without ever having seen it runs the risk of it not being what it seemed, but still the offers flew in. And now they are headed right back onto the market. Even if a seller never claimed the home was better than it actually is, when a property goes back on the market that hurts a seller’s prospects for the future.
Median # of days on the market in Asheville MSA
Learn More: What to know about Renting a Home in Asheville
If the Asheville housing market isn’t actually cooling off yet, when is it going to?
This is a tricky question. Nobody has a crystal ball that will tell us when and how that’s going to happen. The variable we do know is this; the current state of the Asheville housing market just simply isn’t sustainable. Just like you might eat very well for a period of time to lose weight, but realize you cannot survive on salads all day every day, the housing market cannot either. For this market, those salads are the record low interest rates buyers are being tempted with. These deceivingly low rates are allowing buyers to feel as though they can buy homes outside of their budget because they’re playing with monopoly money. At a point this has to stop. Interest rates will return to normal, and people will start buying homes again closer to their actual value prices.
Market saturation will also have much to do with the market cool down. Currently, Americans are moving in record numbers. Whether they are leaving more expensive cities due to the financial blow of the pandemic, or perhaps have discovered a way to indefinitely work remotely, meaning they can now live wherever they like. For whatever reason, so many people moving means many people needing to buy new homes. When this “great migration” slows, the market will reach a more normal and balanced quota of buyers and sellers.
Obviously, a healthy housing market has nearly equal amounts of both. While patience may be difficult, the absolute best thing you can do if you are currently trying to buy a home is to wait it out a bit longer. If that isn’t an option, you can check out my tips for success when buying or selling a home in the current housing market.
Looking to buy a home in Asheville?
If you are one of these countless relocating Americans, and are interested in purchasing a home and moving to Asheville, NC, reach out to me. I would love to tell you everything I know about beautiful Asheville, and if you decide it’s the right place for you and your family, help you find your perfect home!
PIN FOR LATER