Asheville & Black Mountain Real Estate Market Update

Our quarterly market update starts below and was published on April 14, 2021. You can also skip down to our section of real-time Real Estate Statistics for the Asheville Area.

Every quarter we take a look back at the trends and statistics from the last 3 months. The first quarter of 2021 has been more of the same of what we saw in 2020. Fueled by the global pandemic, historically low interest rates, and ridiculously low real estate inventory, the real estate market in Asheville, NC remains the hottest it has ever been.

Inventory Has Dropped to Even Lower Levels in 2021

In our 2020 End-of-the-Year update, we discussed the lack of inventory for sale. In the first quarter of 2021, inventory has dropped even lower. Some of this can be attributed to seasonal norms, as inventory in Western North Carolina typically hits its lowest level of the year in January or February. Then, listings begin to hit the market in March and typically peak during the summer.

But so far (and it’s still early in the listing season), inventory levels have not even slightly recovered. In fact, the number of homes for sale is down 60% from a year ago, and that was the beginning of the COVID-19 pandemic.

This translates into just over a 1 month supply of homes available for sale. In order words, if no new listings came on the market, there would be zero homes to buy in just over a month’s time.

The Number of New Listings is Almost the Same as 2020

Some good news in the housing market, especially for buyers, is that the number of homes listed for sale thus far in 2021 is almost dead even with number of new listings during the first quarter of 2020. Why is this good news? Well, keep in mind that the coronavirus outbreak didn’t really start shutting things down in earnest until March of last year. And after it did, the next few months saw a huge decrease in the number of homes that came on the market. But now we’re in a period of time when many segments of the economy and everyday life are re-opening. This optimism and gradual return to normal should spur more sellers to put their homes on the market as they would normally do during the listing season.

Now, there is still a lot of pent-up demand for homes (and land as well), so we still don’t expect inventory levels to rebound quickly. Most new listings will sell quickly, which means lots of sales, but not lots of inventory “on the shelves.”

Demand for Homes Remains Unsatisfied

Here’s what we mean by the increase in the number of sales, but with no corresponding increase in inventory. In the first quarter of 2021, the number of sales was up 19% countywide. This number should continue to spike as we continue into the listing season through the 2nd quarter of 2021 and hopefully begin to satisfy some of the pent-up demand.

Multiple Factors Continue to Drive Demand in the Asheville, NC Market

We’ve said this in each of our last few quarterly updates, and even though it sounds like a broken record, it remains true. Buyers’ needs and wants in a home have changed. Home offices are essential for primary residences. Other features like fenced yards are important, too. But the demand for homes to be used as AirBnb rentals has also exploded. For these properties, buyers often want a mountain view or a log cabin.

It’s important to remember that the Asheville market was already red-hot before COVID; the pandemic simply accelerated demand and put a huge damper on supply. So why was the market already hot? Out of state buyers still consider Asheville property taxes and NC state income taxes to be relatively reasonable, the weather is great, and there’s lots to do (even in a pandemic).

Add in record-low mortgage rates, and many buyers have more than enough reasons to move to Asheville.

The 2021 Listing Season will be the Busiest One Yet

We predicted in our last update that the 1st quarter of 2021 would see record sales figures, and it did. Of course, that was an easy prediction to make. The market hasn’t really changed much since then. The 2nd quarter represents the first somewhat normal listing season since the pandemic started, so we expect more new listings compared to the 2nd quarter last year, and almost all of those listings should sell within a month or less.

If you’re considering selling your home this season, here are a couple of key metrics that show what a homeowner selling a home in the Asheville market might expect.

The first is the ratio of sale price to list price. This metric is trending up, with sellers negotiating very little (if at all) off of their asking price. Multiple-offer situations (bidding wars) and contracts for over asking price are not unusual. We’ve seen a few homes sell for more than $100k over asking price!

Asheville real estate prices are at all-time highs and the trend is still going up. Many home sellers are poised to tap into substantial amounts of home equity.

One of the most attractive metrics for home sellers is the quick selling times we are seeing in this market. The median days on market is right around 2 weeks across most of Buncombe County!

Land Sales Are Still Spiking

Pending land sales across the Asheville area have continued to rise over the last 12 months. As mentioned in prior updates, some of this demand is due to buyers being unable to find a home to buy. Building a home is, of course, a much different process than buying a home. For that reason, many buyers remain on the hunt for an existing home. But for others, building a home in the mountains is a dream come true, and building ensures that you can get the unique features and special touches that you want in a home. And we’re seeing a lot of buyers in this market who want to build their dream home.

As a side note, we’re often asked if it’s more affordable to buy an existing home or build new. As a general rule, it’s usually more affordable to buy an existing home than to buy a lot and build a new home, especially if you’re considering building on slope. Construction costs (and especially lumber) have skyrocketed, leading to high prices per square foot to build. But there are exceptions. For example, some new residential developments where lots of homes are being built offer attractive pricing on brand new homes.

Something to consider when choosing between buying a home and building a home is the certainty of the final cost. If you’re considering building a custom home, it’s important to understand that costs can increase over the course of construction, so it’s wise to budget for this.

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Asheville & Black Mountain Area Real Estate Trends and Statistics

At Freestone Properties, we’re a little bit geeky. We love statistics, especially when they help to identify trends in the market. The statistics in this section of our website are updated in real-time. We’ve included many different charts and graphs based on geographic area, price range, square footage range, and other factors. The graphs are interactive, so hovering your mouse over the graphs will show the detailed figures.

We hope you find this information useful if you’re considering selling your home or considering moving to the Asheville area. Keep in mind that statistics such as days on market, sale-to-list-price ratio, price per square foot and other figures can vary greatly depending on a lot of factors. Each property is different, so contact us to discuss a specific property.