Bubble in Asheville (Black Mountain, Weaverville, Kelly: loan, home sales, buyers)

[Crazy G]

WNC has done well to date...BUT, that too, is rolling over NOW!!!!

Defintely slowing down.....the reason, is people elsewhere can't sell their homes to move here....

When & ""IF"" it finally hits, it going to be a massacre....local population can even begin to afford all these homes , at such inflated prices....

70% of all house sales in Hendersonville are less than $300K...

""BUT""....70% of all listing are above?????

Which side do you want to be on????

[Researching Retirement]

Originally Posted by wooaway

Wow. Went to asheville this past weekend. I'm not sure how the market is holding on. A vanilla nothing special house in Biltmore Park is going for $200 a sq ft. Looked at a basic 2300 sq. ft. house and asking price is $470k. Ouch.

Well, the real question is not what they are asking but what will they eventually sell it for and how long will it take to sell. That will provide a much better idea of whether the market in Asheville is in fact holding on, holding out, or plain holding on to an inflated perception of value.

I've been looking at real estate listings in the Asheville and Hendersonville areas for the last 6 months and there are many listings still out there that I saw the first day I was looking. Lots of properties are not moving so the only way an individual or the market can really hold on is if they don't really need to move/sell. In that case, they can wait as long as it takes. Otherwise, $200/sf is going to come down IMO. Another 6 months to a year of this kind of market and people are going to get desperate and a lot more realistic about the value of their houses.....even in Asheville.

For everyone there trying to sell a house, I hope the downturn isn't as bad as it feels like it could be.

[Crazy G]

Financing is dry up....

The number of mortgage brokers is greatly diminished, and banks just don't have cash to lend out...period...

In the banking business, it's both a credit squeeze, and cash crunch ""BOTH""

The losses the banks are taking, on foreclosures, is affecting their capital structure, to the point that they need cash...they're NOT lending like they used to....a $1 dollar loss, affects $10 of lending.....

eg....""QUESTION???""
When was the last time you got a credit card ad in the mail????

Today, I got a ad from Macon County Bank, to open a checking account, and they'd give me a 'toaster' or something....[they need cash]

We're back to the 1980's again, with S&L crises all over....

10 years at least to work this thru!!!!

Worst of all..

>>>>>>>"""THERE WILL BE TEARS""<<<<<<<<<

[Asheville Native]

Originally Posted by wooaway

Wow. Went to asheville this past weekend. I'm not sure how the market is holding on. A vanilla nothing special house in Biltmore Park is going for $200 a sq ft. Looked at a basic 2300 sq. ft. house and asking price is $470k. Ouch.

Hey, that is a deal, you should have snapped it up. Some speculator is building a 1170 sq/ft house (not sure that is a good description) but the foundation is 24 x 24 feet (counted the block when walking by) and three stories tall, on a tiny steep lot, without a view of anything but the one they are building 10 feet away. The sign says they are putting up 18 homes or town homes. Looked the property up on the GIS system, and it is only 3 acres for all 18, and it is also quite steep.

And you can pick it up for a mere $625K ($534 per sq ft)

I guess they are working on the PT Barnum theory, some idiot with more money than sense will come along and buy it.

[gypsychic]

Originally Posted by Asheville Native

Hey, that is a deal, you should have snapped it up. Some speculator is building a 1170 sq/ft house (not sure that is a good description) but the foundation is 24 x 24 feet (counted the block when walking by) and three stories tall, on a tiny steep lot, without a view of anything but the one they are building 10 feet away. The sign says they are putting up 18 homes or town homes. Looked the property up on the GIS system, and it is only 3 acres for all 18, and it is also quite steep.

And you can pick it up for a mere $625K ($534 per sq ft)

I guess they are working on the PT Barnum theory, some idiot with more money than sense will come along and buy it.

Wow, those are some crazy "stupid" prices, as a friend of mine would say. It makes my house sound like a real steal - getting ready to list my Kenilworth Forest home around $249,000. My realtor actually had higher comps for that neighborhood, houses sell within a month or two even in this market at asking price or only slightly below. Nothing else for sale in there now except ours when we list. We love Asheville very much, but we know there are no good jobs to be had and my hubby has a good one now where we live in Florida, so we know we won't be able to move up there in the foreseeable future. I love that little house and neighborhood, kind of hate to see it go, but must be practical. And if it doesn't sell, we don't care, we like it can afford it and will just keep it for now.

I truly hope the insane building and destruction of all the beautiful mountains comes to a grinding halt - that is going to destroy what so many are attracted to the area for. Every time we go up there, there is more building and more destruction. Who the heck is buying all that overpriced stuff? And why anyone would want a tiny house on a scary steep lot at ANY price is beyond me, let alone for a small fortune.

And I have to agree with all of you about the infrastructure here - it badly needs to catch up with all this growth - water system is not adequate, roads too congested, etc. Definitely affects the quality of life.

[smalltownusa]

Originally Posted by Crazy G

Financing is dry up....

The number of mortgage brokers is greatly diminished, and banks just don't have cash to lend out...period...

In the banking business, it's both a credit squeeze, and cash crunch ""BOTH""

The losses the banks are taking, on foreclosures, is affecting their capital structure, to the point that they need cash...they're NOT lending like they used to....a $1 dollar loss, affects $10 of lending.....

eg....""QUESTION???""
When was the last time you got a credit card ad in the mail????

Today, I got a ad from Macon County Bank, to open a checking account, and they'd give me a 'toaster' or something....[they need cash]

We're back to the 1980's again, with S&L crises all over....

10 years at least to work this thru!!!!

Worst of all..

>>>>>>>"""THERE WILL BE TEARS""<<<<<<<<<

CG,
I had to think about the cc solicitation and although we still get them, they have slowed down considerably...

In my wildest scenario, I can not see us coming out of this snowballing mess too quickly. We have the housing crisis, the car industry crisis (no one is buying new cars either), the energy costs doubling the price of everything item you purchase and the staggering household debt (a combination of keeping up with the Jones' and credit cards absorbing, again, the escalating energy prices) with the final kick in the shins, the loss of jobs and manufacturing overseas...... this will not correct itself easily.........

It's not close to over IMO and compared to a tsunami, the last wave has not even hit.... Then there's the damage assessment when it recedes and it aint gonna be pretty...

[smalltownusa]

Originally Posted by Asheville Native

His opinion, like your opinion, is just that opinion, but I fear he is much closer to the reality of what is going on. The latest effort by Bush to freeze rates to keep people from loosing their homes is a band-aid, and will expire in 5 years. When the coach turns back into a pumpkin, hang on cause it is going to be a mess.

The root cause is that people were lied to and told they could afford homes that they didn't have a chance to qualify for without falsifying income on the loan applications. Well guess what, there is no fix to fix that, these people could not afford these homes to begin with, all you have to add to the formula for disaster is the impact the energy cost rise on these peoples bottom line.

This is OT, but humor me. My favorite scenario was a family in L.A. I read about who bought a $650,000 dream house and suddenly they could not afford it when their interest rate "re-adjusted" and wondered if the govt was going to bail them out. Their income? Ninety thousand a year and their mortgage payments had jumped to somewhere in the range of $4500/month can't recall if it was pre-taxes and insurance or not but it doesn't matter.......do the math. They never should have been approved to buy this house.

[smalltownusa]

I grew up in a household where I was taught early on that you don't spend what you don't have. It's served me well, especially when I saw what was happening with fuel and housing prices over the past several years, not to mention watching other people's spending habits

There you have it. Living within your means, the results of which will serve many of us well while a financial quagmire engulfs those who embraced a lifestyle of out of control spending habits. Living by the adage: do I really NEED that new "car, house, computer, bedroom suite, in-ground pool, cruise, etc.?" versus the "I must have it NOW, affording it be damned" allows one the ability to ride out a recession, albiet, still bumpy. For many others, it will be an eye-opening fright-fest roller coaster ride of financial comeuppance......

Too bad their shame is exposed only at the financial expense of the American public.

Yes, the drawback being, we are all going to take a hit for this failure to see the Emperor had only his under garments on.....

[Asheville Native]

Originally Posted by smalltownusa

Yes, the drawback being, we are all going to take a hit for this failure to see the Emperor had only his under garments on.....

This emperor is buck nekid, yet many see only fine silk robes.

[Steve Hazzard]

Originally Posted by Flat2MT

NCBND, your explanation is dead on. Especially your last thought.....

I too am bullish on WNC but I am prepared for it to get much worse before it can even begin to get better.

Check out this forum...Jus' West of Asheville....where we've recently discussed this same topic.

So, when I move to Asheville around 2010 and rent my one bedroom unfurnished apartment, the real estate market will have stabilized and everything will be okey-dokey once again, and all will right with the world.