11/16/2011 - Home sales around downtown Asheville slump over years, but perform better than rural areas
by Mark Barrett - Asheville Citizen Times
ASHEVILLE -- About 15 years ago, a potential homebuyer told local Realtor Ben Mansell, "I'm looking for something walkable."
That was the first time Mansell can remember any client raising the issue of how easy it is to walk in the neighborhood around a house. However, "Now, I hear it more and more and more."
Mansell's experience is one of several explanations for why the housing market in downtown and near-downtown neighborhoods is showing more strength these days than in most of Buncombe County.
The number of homes sold in the 28801 ZIP code -- which includes downtown, Montford, several neighborhoods just north of Interstate 240 and areas between downtown and Biltmore Village -- was up 16.8 percent during the first nine months of 2011 compared with the same period a year ago.
The average sale price rose 3.4 percent, according to figures from local real estate analyst Don Davies.
Sales in and around downtown are still far below levels seen at the height of the real estate market in 2006 and 2007.
But the number of sales so far this year in Buncombe County as a whole has been essentially flat, and prices have suffered, making 28801 a relative bright spot. Sales in remote areas have generally declined more since the peak of the market than neighborhoods closer in.
People in the industry say the downtown scene of restaurants, bars, nightclubs and boutique retailers is a big attraction for buyers, as is the ability to put fewer miles on their cars and spend less money at the gas pump.
"All kinds of cities are revitalizing their downtowns, and people are moving back," said Bonnie Gilbert, a Realtor at Trillium Properties of Asheville. "Asheville, of course, is experiencing that."
Buyers often tell her "they would like to live as close to downtown as they can."
Sales of condominiums have not recovered from the days when it seemed someone was announcing a new condo building every other week, said Scott Carter, owner/broker at The Real Estate Center.
New buildings coming on the market significantly boosted sales, but only resales are available nowadays, he said.
"I think it's going to be a long time before you see the 81 sales again," he said.
Prices have declined, too. A few years ago, one of the nicest units might have commanded $500 per square foot and the average for all was around $400, Carter said.
Now, the ceiling seems to be about $375 per square foot for a condo and the average is around $300, he said.
That means it is likely to be a while before someone decides to try to build more condos downtown, Carter and Davies said.
"They just can't build them today and sell them for the prices" units are selling for now, Davies said.
A few years ago, people buying second homes made up about 85 percent of downtown condo buyers, Carter said. That percentage has dropped dramatically as more buyers are looking for a primary residence, he said.
Prices for homes in neighborhoods near downtown have dropped significantly, people in the industry said, and buyers can be pickier than they were a few years ago.
The degree of decline "kind of depends on the price bracket," said Mansell, a Realtor at Town and Mountain Realty. "Things over $1 million have been hit the hardest. A house that was $180,000 might be $160,000 now."
Montford, Gilbert said, "has taken a hit from 2005, but I think people are now a little more realistic about pricing their homes, so it's getting more affordable."
"Anything that's close to downtown is still selling," said Nona Armour, a Realtor at Keller Williams Realty in Asheville.
But the days in which almost anything in Montford would sell quickly are gone, and owners of homes needing work have to be sure their price is reasonable, she said.
Some people are still looking for homes they can fix up, but more are interested in homes that buyers have kept in good condition, she said.
"If the bones are still really good and they've updated (a home) and they've taken care of the place, it makes all the difference," Armour said.