4/16/2012 - Home sales create optimism in Asheville-area real estate industry
by Mark Barrett - Asheville Citizen Times
ASHEVILLE -- A mild winter and a mild economic recovery provided some warmth to the area housing market during the first three months of the year.
First-quarter sales of existing homes in Buncombe County were up 27.2 percent over the first quarter of 2011, according to figures from N.C. Mountains Multiple Listing Service.
And the increase in sales for four area counties including Buncombe -- the others are Haywood, Henderson and Transylvania -- was just a hair better at 27.8 percent.
People in the industry said the increases could be attributed to more optimism about the economy, nice weather that made it easier for buyers to get out and look for a home than during the previous winter and relatively low numbers of homes on the market .
"I don't think it's anything that people ought to jump up and down about ... but I think we are beginning to see a trend that is going to be good for Asheville in about a year," said local real estate analyst Don Davies.
Sales are still relatively weak compared to levels seen during much of last decade, and the proportion of homes sold either because of foreclosure or to avoid one is higher than historic norms.
But people in the industry say most trends are positive.
"Homes are really grounded in the rest of the economy, so as the rest of the economy gains momentum" home sales do as well, said Mike Figura, head of Mosaic Community Lifestyle Realty. "Now that the recovery seems like it is here to stay and people are more confident, they're more apt to make changes."
Mark Ledbetter, director of operations at Prudential Lifestyle Realty, said he is "very, very optimistic that it's not just a blip, that consumer confidence is up and things are moving in the right direction.
"People are tired of waiting" to move up to a larger house or make other life changes that involve buying a home, he said.
Stronger housing markets elsewhere also make it easier for people seeking to move to the Asheville area to sell the home they want to leave, Figura and Ledbetter said.
Some are buying here before selling elsewhere, Ledbetter said: "Now they have the confidence that it can sell or will sell."
Kim Keel said it is too soon to tell how hard it will be to sell the three-bedroom, one-bath home her family put on the market for $173,000 in Arden's Royal Pines neighborhood last week, but she is encouraged by what she sees around her.
"We've been considering this move for three and a half years," Keel said. "I do see that the houses in our neighborhood are selling faster than they did three years ago, even than they did a year ago."
Cold, snowy weather depressed sales in early 2011, Figura said, partly because there were so many times when people could not easily get out to look at homes.
This year's warmer winter had the opposite effect, he said.
"When the weather's nice, people like to be out ... and people like to look at houses," he said.
Davies said the weather helped sales "a little but not a lot."
A reduction in the number of homes available for sale has firmed up prices somewhat, he said, although banks and people desperate to sell homes are still offering big discounts.
"We are finally beginning to see an inventory level that is more realis tic than we've had in a long time," he said. "We're still hanging in there at about 2,300 homes (for sale in Buncombe County). That's the lowest that we've had since 2004."
The median price -- the point at which half were higher, half lower -- of a home sold in Buncombe County in March was $185,000, up from $174,000 in March 2011.
However, median sale prices dropped substantially in Haywood, Henderson and Transylvania counties.
In Buncombe, "The inventory level is being eaten away slowly, and nobody's building much," Davies said, resulting in some upward pressure on prices.
The large supply of homes that have been through foreclosure remain a drag on prices and a sign that the market cannot yet be considered strong , Davies said.
The number of Buncombe County homes sold in the first quarter this year owned by banks and similar institutions rose 35.1 percent, increasing more than overall sales, according to numbers Figura provided.
Bank-owned properties -- typically, homes that banks and similar institutions acquired via foreclosure -- accounted for 18.7 percent of sales in the first quarter of 2011, according to numbers Figura provided.
That figure rose to 19.8 for the first quarter of this year.
That's too many, Davies said. "It's just not a healthy market when you've got that."