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Asheville was last to the party during the housing boom sucking in the dumb money. Now we're seeing the repercussions. This area is too large/populated to try and run an economy based solely on tourism and fleecing "rich" retirees form the North East. Still seeing folks posting about moving here sight unseen with no real research done on the area. A caveat to you: you will be moving to an area that will linger in economic depression long after the rest of the country begins to recover.
Asheville was last to the party during the housing boom sucking in the dumb money. Now we're seeing the repercussions. This area is too large/populated to try and run an economy based solely on tourism and fleecing "rich" retirees form the North East. Still seeing folks posting about moving here sight unseen with no real research done on the area. A caveat to you: you will be moving to an area that will linger in economic depression long after the rest of the country begins to recover.
I agree that Asheville may see a lag in its recovery with respect to retirees. While many have seen a recovery in their 401K plans as the stock market has boomed in the last year, a lot of potential retirees had to pull money out of retirement plans just to stay afloat. Another bunch took early retirement and ended up with smaller annuities and SS benefits. As a result the flood of retirees to Asheville and environs has slowed to a trickle and will continue at a subdued level for some time--folks may not be able to afford to move here in the same numbers as in the past. However, the drop in real estate values may just make housing a bargain for many from outside the area and act as a magnet for them.
I don't think that the tourist industry will be hurt as much. Folks who normally dropped big bucks for trips to Europe, etc. will be more likely to spend less and take vacations here in the USA. And with all the publicity that Asheville just received as a first class vacation destination I expect to see more and not less out of state plates here this year. Keep your collision insurance premiums paid up
Has the growth in the stock market been organic or due to Fed policies? In other words is it sustainable, or are we reliving the late '90s or 2007? What effect will that have on a region who's economic growth was based on a bubble?
Brent crude topped $100 yesterday last time that happened was in 2008, what will that do for the local tourism industry? I love WNC, what Asheville has become not so much, but really a first class vacation destination? The area has always been a regional attraction, and has had bouts of national fame that have gone bust. Is this truly an industry which we can bank on for future growth and development of the region? Or is it just another passing trend fueled by speculative development?
By the way there's a 17+ month supply of homes on the market currently with Asheville to go along with the story at the head of this thread. This will only add to the supply. People who are trying to bottom fish the real estate market are years too early...
I agree that Asheville may see a lag in its recovery with respect to retirees. While many have seen a recovery in their 401K plans as the stock market has boomed in the last year, a lot of potential retirees had to pull money out of retirement plans just to stay afloat. Another bunch took early retirement and ended up with smaller annuities and SS benefits. As a result the flood of retirees to Asheville and environs has slowed to a trickle and will continue at a subdued level for some time--folks may not be able to afford to move here in the same numbers as in the past. However, the drop in real estate values may just make housing a bargain for many from outside the area and act as a magnet for them.
I don't think that the tourist industry will be hurt as much. Folks who normally dropped big bucks for trips to Europe, etc. will be more likely to spend less and take vacations here in the USA. And with all the publicity that Asheville just received as a first class vacation destination I expect to see more and not less out of state plates here this year. Keep your collision insurance premiums paid up
WNC, and Asheville and Hendersonville/Flat Rock have historically been the most popular area for many Floridians escaping the oppressive summer heat and humidity, and folks from Charleston SC (who first populated this area) and for northerners looking for lower cost of living and the quality of life offered in the mountain regions.
After the brutal northeast and midwest winters, we will see our market gaining sales as homes finally get sold in much warmer climates; and the cycle will regenerate itself. We will see more second homes that have dropped in price being sold here also as a result. WNC will always be a tourist destination and a place for outdoor adventure, wonderful climate, arts, culture, plenty to do, and beautiful open spaces.
So you're calling a bottom to the local real estate market, Quilterchick? I'll take the other side of that call. For most people a home is their biggest investment; they will need to be able to sell in those cold locations to move here (or some place cheaper) in the south. Until I see a roll back of government spending and Fed policy shift from effectively 0% interest rates I don't see a sustainable recovery that will re-ignite the housing market. Did you ignore the ACT story at the head of this post? How many of those foreclosure do you think are second home owners or speculators (often one in the same)?
How many of those foreclosure do you think are second home owners or speculators (often one in the same)?
I'd bet there are a lot of them. Those folks bought into the idea that they could take out a second on their existing home and buy another one in Asheville as an investment, flip it in a couple years and make a big profit. So now they can't afford the first mortgage much less the second and they have to drop one. Sure would be interesting to see what percentage of foreclosures are for primary residences
What is going to give this economy a boost will be when we start to see a little bit of inflation. Yes, inflation. An uptick in the interest rates will do it, even slightly. The housing market runs the economy with tentacles that go out in every direction. Everything that goes into a house needs to be produced, purchased, installed, taxed, those homes bought and sold over and over, and on and on.
When folks who've been sitting on the sidelines "waiting for the bottom" realize that the bottom passed them by, and they start to see an upward curve (it always happens), they will jump on board and there will be not only a renewed interest in primary residences by folks who had no choice but to rent, but there will be a huge pent up demand.
I doubt there will ever be another bubble like we had in 2005/2006, but that's okay, as long as the economy gets rolling along, things will be just fine.
The Doomers and the Gloomers have been around forever.
I honestly don't even know where to begin with that last post, QuilterChick. The housing market cannot run an economy the size of the US. As for a little bit of inflation have you looked at oil prices lately? How about every time you visit the grocery store? Or how about the price or cotton?
We need deflation in housing to bring houses in line with incomes, not inflation in that sector (which is what Bernanke is attempting by keeping interest rates artificially low to keep the TBTF banks alive). We've had serial bottom callers for the last two years. When I first started posting here it was to combat the inanity of the local Realtor hordes posting "Buy in Asheville now or be priced out forever." When is it ever not "The Best Time to Buy A New Home!" Why should anyone capable of independent thought and a basic understanding of math trust anything out of the Johny come lately/get rich quick Realtors and NAR mouthpieces who just happened to spring out of the ground like weeds during the boom?
There is a 17+ month supply of homes on the market at this time in the Asheville market; do you think that number will go down or up with the spring selling season approaching?
I'm truly hoping for an economic turn around but it has to be based on fundamentals not Fed or Gov't stimulus. For every dollar the gov't is spending currently we're getting about 0.40 of growth. How long can we keep digging that hole? What industry will pull us out of this? Where is our competitive advantage in the global market place? Can we continue to eliminate the middle class by outsourcing and offshoring jobs and still expect a rising standard of living in the US?
Asheville is not an isolated island. We have built an economic house on a foundation of sand in this region.
Edit: Sorry for the rant. I don't want to sit here and right a multi-page discourse on everything wrong with that last post. Yes just what we need more inflation in necessities such as housing. Jesus.
We've already had deflation in home prices, which are at or near a bottom. It is the monkey-ing around with trillions of dollars of debt by Barack Obama and his Administration that has sunk the economy. I didn't say "glaring inflation" will get the housing market going, I said "a little bit of inflation". An uptick in mortgage interest rates has historically nudged people to buy homes who have been waiting on the sidelines and gives the market a kick start.
For doubters, the housing market is 20% of GDP.
As for WNC, with all the bad weather and extreme cold up north, I predict you will see more folks heading south to FL etc. and that will loosen up the FL market which is in deep doo doo currently.
And yes, if anyone does not think this is truly a great time to buy a home or investment property, they simply don't "think".
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10 Foreclosure Hot Spots
