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Unfortunately, unless there's a quick cure or vaccine, looks like we're probably headed for a deep recession or depression. I suspect those boutique builders (as well as other builders) are going to have to lower their prices considerably. The housing market is likely going to take a huge hit. My guess is if you still have the money, you're going to be able to build or buy a house for considerably less. Construction costs are going to decline, perhaps dramatically, as a result of demand drying up. While western NC is somewhat less impacted than some areas, my feeling is that it will still be greatly impacted by this terrible event.
Good point! I'd rep you again but it won't allow me. I was pondering over this too. Although it may help people that are planning to build, the economy in general is headed south. This is a big concern for sure.
Unfortunately, unless there's a quick cure or vaccine, looks like we're probably headed for a deep recession or depression. I suspect those boutique builders (as well as other builders) are going to have to lower their prices considerably. The housing market is likely going to take a huge hit. My guess is if you still have the money, you're going to be able to build or buy a house for considerably less. Construction costs are going to decline, perhaps dramatically, as a result of demand drying up. While western NC is somewhat less impacted than some areas, my feeling is that it will still be greatly impacted by this terrible event.
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Originally Posted by beckycat
Good point! I'd rep you again but it won't allow me. I was pondering over this too. Although it may help people that are planning to build, the economy in general is headed south. This is a big concern for sure.
I’m looking to buy in North Asheville and holding back to see what happens. We are due for a recession. My broker says that the market under 500k is weakening and houses priced above going to take a hit.
I would also appreciate it if you could PM me the name of the modular home builder. Thanks!
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Western North Carolina, Haywood County in particular, has needed a reset on square footage prices. It's gotten ridiculous. $200/sq. ft. is the STARTING point for builders up there. Drive 1-1.5 hours South/East into South Carolina and it becomes a lot more reasonable to the tune of $120-150/sq. ft. This can make the difference between being able to build and not being able to build. I know it personally and I see others on here have come to this realization too.
Frankly, I don't get it. Builders will say the materials cost so much more, we are just scraping by, labor rates, blah, blah. I cry BS! I-40 goes right through the middle of the county. Big trucks loaded down roll through there every day. This is not Alaska or some island we are talking about- this is an accessible area. Scraping by? Look at most builders personal homes. I assure you they did not pay their customer's rate. When it comes to labor, they do not keep skilled laborers on their payroll anymore. It is farmed out and a lot of the construction labor comes from immigrants that are not being paid exorbitant salaries. The builders have just gotten too big for their britches. Some will say the builders are just charging what the market will bear. I call it greed. Plain and simple.
I hope this crisis humbles the builders and brings them down to a reasonable rate. A rate a regular worker can afford.
I agree that the WNC market is badly stacked against buyers and anyone contemplating building or rehabbing, and has been so for the past decade. My wife and I got a couple of bids just pre-pandemic for our modest Asheville-area fixer-upper and they were flat out ludicrous, more than $250/square foot on average. When I pushed back on the general contractors they blamed their pricing on their subs. We had a couple of other builders refuse to look at our project at all since it was sub-$1MM.
Maybe the builders will sing a different tune when unemployment is 20%. "They that exalteth themselves shall be humbled."
I agree that the WNC market is badly stacked against buyers and anyone contemplating building or rehabbing, and has been so for the past decade. My wife and I got a couple of bids just pre-pandemic for our modest Asheville-area fixer-upper and they were flat out ludicrous, more than $250/square foot on average. When I pushed back on the general contractors they blamed their pricing on their subs. We had a couple of other builders refuse to look at our project at all since it was sub-$1MM.
Maybe the builders will sing a different tune when unemployment is 20%. "They that exalteth themselves shall be humbled."
One would only hope so. So far, I have been watching the real estate market here and nothing has changed. Even with all this going on, building continues strong on a daily basis. The construction sites from existing builds are business as usual. I will be keeping an eye on it and it will be interesting to see how this goes.
I agree that the WNC market is badly stacked against buyers and anyone contemplating building or rehabbing, and has been so for the past decade. My wife and I got a couple of bids just pre-pandemic for our modest Asheville-area fixer-upper and they were flat out ludicrous, more than $250/square foot on average. When I pushed back on the general contractors they blamed their pricing on their subs. We had a couple of other builders refuse to look at our project at all since it was sub-$1MM.
Maybe the builders will sing a different tune when unemployment is 20%. "They that exalteth themselves shall be humbled."
I have little doubt prices will come down. The inflow of gov't. $ may help postpone the drop temporarily, but a decline in building and housing prices is coming. There are a lot of second homes here and retirees who are looking to build or buy. Stock portfolios have been decimated. People are out of work. Consumer and investor confidence have been shaken. This is not going to be easily and quickly rectified. People are going to be very reluctant to buy or build. These subcontractors who have been charging so much are going to be hurting for business. When they have little business, watch their prices drop. It will take a while to happen, but once the gov't. $ runs out and they can't pay their bills or feed their children, they'll be willing to build for a whole lot less. It's often been curious to me how you can cross the SC line and prices to build or buy drop greatly (even on similar terrain).
I’m retired from the building business. There are a couple of reasons houses are more costly in the Asheville area:
1. Asheville is in a colder climate zone than SC, so more insulation and higher importance of air sealing, rain screens, etc. If you go to the higher elevations you can be 2 zones different than SC.
2. Many builders are building energy efficient houses, above what is required by code, and building “ green” for heating degree days is more costly than cooling days ( SC ). These homes also utilize energy designers/ engineers = more expense.
3. The demand for competent skilled workers is high, so they can charge more; Carpenters who frame 80 foot long houses to within 1/16” square, or tilers who can install a perfect mosaic-tiled master bath with linear floor drains, niches, etc. are few these days. Often you have to wait weeks for these crews, and that is only if, as the General Contractor, you have given them steady work and pay in full upon completion.
4. It is definitely more expensive to build on slopes and treed sites. Most of the good lots are taken, and the remainder are less desirable due to slope or flooding, etc.
5. Buncombe County has more regulations = higher cost to build. Wait until Asheville puts their new tree ordinance into place. People will be paying thousands of dollars more for tree work/ mitigation on their lots.
6. Materials do cost more if they have to be trucked. Much lumber here comes from producers/mills in lower SC. If you are shipping from coastal SC to Greenville ( or even Anderson to Greenville ) vs Asheville , of course you are paying more. Also I believe SC has a lower tax rate so fuel is cheaper there. That makes all goods/labor cheaper.
Biggest driver of cost: Demand has been much greater in WNC than the available quality labor.
I’m retired from the building business. There are a couple of reasons houses are more costly in the Asheville area:
1. Asheville is in a colder climate zone than SC, so more insulation and higher importance of air sealing, rain screens, etc. If you go to the higher elevations you can be 2 zones different than SC.
2. Many builders are building energy efficient houses, above what is required by code, and building “ green” for heating degree days is more costly than cooling days ( SC ). These homes also utilize energy designers/ engineers = more expense.
3. The demand for competent skilled workers is high, so they can charge more; Carpenters who frame 80 foot long houses to within 1/16” square, or tilers who can install a perfect mosaic-tiled master bath with linear floor drains, niches, etc. are few these days. Often you have to wait weeks for these crews, and that is only if, as the General Contractor, you have given them steady work and pay in full upon completion.
4. It is definitely more expensive to build on slopes and treed sites. Most of the good lots are taken, and the remainder are less desirable due to slope or flooding, etc.
5. Buncombe County has more regulations = higher cost to build. Wait until Asheville puts their new tree ordinance into place. People will be paying thousands of dollars more for tree work/ mitigation on their lots.
6. Materials do cost more if they have to be trucked. Much lumber here comes from producers/mills in lower SC. If you are shipping from coastal SC to Greenville ( or even Anderson to Greenville ) vs Asheville , of course you are paying more. Also I believe SC has a lower tax rate so fuel is cheaper there. That makes all goods/labor cheaper.
Biggest driver of cost: Demand has been much greater in WNC than the available quality labor.
Thanks for your perspective. I still think builders and subs are overcharging in western NC, and people, up till now, have been willing to pay these 'jacked up' prices. Take the Cliffs Valley as an example. We have looked at many homes over the years for possible purchase in The Cliffs Valley (which is just across the line in SC). We have always been amazed at how much more house you can get for your $ there.
1. While the elevation is perhaps a little lower, many lots are close to what they are in western NC.
2.The homes there are just as energy efficient as nicer homes in western NC.
3.Demand for skilled workers just as high.
4. Most of the lots are similarly sloped.
5. Correct, Buncombe County does have more regulations.
6. Not a factor since the Cliffs is relatively close to western NC.
Demand also very good at the Cliffs.
Bottomline: Builders and subs are overcharging in Western NC because they can (could) get it. Once, business significantly drys up, they are going to be willing (forced) to build for a lot less. Simple economics. It's going to take a while for the gov't. $ to run out, but once it runs out, you're going to be able to buy or build at better prices, possibly much better. If I was planning to buy or build in western NC, I'd put it off for at least a year or so. I've heard from a realtor that demand for housing is drying up. This trend is likely going to continue for some time and be even more exacerbated for higher end homes.
Last edited by Lizap; 03-28-2020 at 11:27 AM..
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