Written by Dale News
ASHEVILLE —High-end home sales and construction have surged
since August, signaling the hard-hit housing market may finally be on the
upswing from the Great Recession, local brokers and builders
say.The sale of million-dollar-plus properties doubled in Buncombe County to 19
this August versus eight in August 2011.
“We’re beating records going back five years. We sold more
units this August than we did in August 2007,” said Neal Hanks, president of
Beverly-Hanks &Associates.
The Cliffs at Walnut Cove in Avery’s Creek has 30 homes under
construction or review —double
what the golf course community had previously seen at any one time, said Kent
Smith, of Walnut Cove Realty.The benefits spread beyond just jobs in the
hard-hit construction sector, which has struggled since the 2008 financial meltdown.“New
homes don’t just support construction,” said Tom Tveidt, an economist with
SYNEVA Economics in Waynesville. “There’s continual demand after people move in
that helps support retail and all other businesses.”
“What’s made the Asheville economy unique is not just our
strong health care and manufacturing sectors, but people moving to the area,”
Tveidt said.
The building of one house alone can employ 40 people, Smith
said.
“There’s a guy doing the framing, another doing the
electrical, another driving the truck and so on,” he
said. “These houses are bringing money into Asheville, and it doesn’t stop
after the home is built.”The building boomlet started in the spring, at least
for C. Skip Brewer, a state accredited builder and owner of Walnut Cove
Builders.
Brewer is at work on a million-dollar home now and has two
more projects in planning. “We’re able to put subcontractors back to work, and
they are grateful.”
Buyers are interested in lots at higher-end developments that
survived the fallout from the Great Recession, including the Cliffs at Walnut
Cove, Southcliff, The Ramble and Biltmore Lake and elsewhere.
And those who have bought lots in those developments are
starting to build now.
“People had been sitting on the fence before,” Brewer said. “This
has been our most positive year since 2008.”
At The Ramble, 16 homes ranging from $780,000-$2 million are
under construction, raising the
total to 110 homes in the development with more in the pipeline, said Brad
Galbraith, vice president of community development at Biltmore Farms.Biltmore
Lake has seen contracts for 12 homes averaging $330,000-$500,000 since August.
“We’ve had 21 contracts so far this year, and we’re entering
the height of the fall market, which creates a lot of home sales,” Galbraith
said.
The story is repeated at Fairview’s Southcliff, which has
sold half of the 144 single family lots.
“We have five homes under construction and five in review. We’ve
doubled our sales since last year,” said Mike Romero, of Beverly-Hanks’
Southcliff office.
Asheville’s housing comeback can be credited in part to
strengthening markets around the country.
“There’s a lot of pent-up demand. People in Chicago and
Florida and Texas are able to sell their homes and make the move to Asheville,”
Romero said.
Nationally, existing home sales in August were the strongest
since May 2011, rising 7.8 percent for the month to a seasonally adjusted
annual rate of 4.82 million, according to the National Association of Realtors.
Dale Akins, president of The Market Edge based in Knoxville,
Tenn., saw construction picking up steam across the region beginning in
January.
Construction up, too
Western North Carolina has seen an increase in residential
building permits as well as markets in the rest of North and South Carolina.
Buncombe issued 303 permits for the first two quarters of
2012, up 18.8 percent from over the same period last year.
Third quarter figures won’t be available until later this
month.
In 2011, Buncombe issued 512 permits, significantly down from
the peak of the building bubble with 1,749 permits in 2007 before the Great
Recession.
Akins doesn’t expect numbers to return to those pre-recession
levels “because that market was unsustainable.”
“We reached the bottom in July 2010, and we’ve seen a steady
climb since then,” Akins said.
The rise in building permits could translate into improving
job figures for the Asheville area within the next quarter or two, depending on
the lag “between issuing the permit and actually putting nails in wood,” Tveidt
said.
“It may be trickling through the economy now,” he said.
Malcolm Morgan, of Morgan-Keefe Builders, sees more interest
with clients coming into the market, ready to go ahead with building plans that
may have been postponed for years.
“We’ve built up a base of good subcontractors. So, we’re
hopeful things are going to loosen up in the market for our subs and vendors,
all of us having struggled for so many years.”
Along with historically low interest rates, the cost of
building materials and labor is lower than the housing boom around 2005, Brewer
said.
“Then there was spike in costs with no end in sight, but now
the roller-coaster has come back to the bottom,” he said. “That makes it a
great time to build a house.”
After years of sluggish sales, Galbraith remained somewhat
cautious about saying that the market had finally turned a corner.
“I don’t know how many corners there are, but I’m definitely
not a pessimist,” he said.
Hanks said almost 10 months of improved sales make him feel
more confident about the housing market.
“There’s a strong trend. We’re seeing movement in the upper
end homes —that was the area had that had been very sluggish,” he said. “We’re
still going to have some dips, but the recovery is clearly on the way.”
