With all of the national news surrounding home prices plummeting, and home sales falling, i read this article in the Citizen Times. Here is the gist of it..
ASHEVILLE – Area single-family homes are still increasing in value, a federal government report released today says, even though the number of homes sold has declined dramatically.
Single-family homes in the Asheville metropolitan statistical area – Buncombe, Haywood, Henderson and Madison counties – increased 9.4 percent in value over the 12 months ended Sept. 30, according to figures from the Office of Federal Housing Enterprise Oversight.
That was the ninth-highest appreciation rate among metropolitan areas across the country. The national average was a 1.8 percent increase, the lowest since 1995. (end)
So, what now? sales are slowing. Time on the market is increasing, but prices are still rising and a great pace. For those of you used to 12-18% increases per year, close to 10% is still great, if not a little too high. So what does this all mean? Normally, when sales slow ie time on the market increases, prices begin to decrease or fall so that the homes will sell. this is the natural supply/demand curve. By saying this, i do not mean that prices will decrease to a negative rate (ie -2%), but one would think that prices would not rise 10%. I just do not know. I hope that prices will find a good steady rate, somewhere in the 6-8% a year growth, and time on that market will rebound to an accceptable rate. 3-4 months or so average. When time on the market is short prices go up. When i bought my house a few years ago in west asheville, if the house was on the market more than a few days, it had something wrong with it. When this happens, prices skyrocket year to year. that is not sustainable, and is what happened in San diego, Florida, California, New Jersey, etc. While our prices are nowhere near theirs, all it takes is 5 or 6 years of 15-25% growth for regular people to get priced out of the market. I guess we just wait and see.
On the lighter side, reading the local business section about housing normally scares people to death. It seems like the Citzen Times reprints AP articles that are really national, or washington DC based articles about housing “crisis” or falling prices, etc, but leaves the local market wrap-up for footnotes and side-bar articles. At least this one should offer some hope to local people that our housing market has not tanked. while you may need to wait a little longer to sell, prices are still up. Theoretically, of you are willing to give up on some of your INCREDIBLE gains over the past years, you will be able to sell in whatever time frame you need to.
Just my thoughts. Anyone have anything to add?
David
One Response to “Where is it going?”
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December 12th, 2007 at 4:03 pm
I think David is right, our market has not tanked. However, everybody out there thinks that it is such a strong buyers market, because of the national media, that they are acting like fools. By that I mean going into a home and offering in the neighborhood of 20% less than asking price, for no other reason than its a “buyers market.” Let me tell you something folks, that might work out every once in a blue moon, but generally it simply alienates you from the seller and all negotiations are shot. If you want the house or property be real. If there is a flaw in the home or the home’s pricing and warrants a justifiable decrease in price, fine go for it. Otherwise, please save everybody some time if your just out for a fishing expedition.
This is especially true for vacant land. Remember most folks here own their land straight out and do not have to sell their property, so extremely low and/or insulting offers we’ll get you, the buyer, absolutely no where.
Hope everyone had a great Thanksgiving and best wishes for a Merry Christmas.
Brian
PS I would like to welcome David Hitch to the Carolina Mountain Realty & Development Team.