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Fall Colors in the Mountains

I am sitting here in the office thinking about the devastation around Fort Myers in Florida. Words can’t express how that makes me feel. We are all concerned for those who lost family, pets, homes or property during the storm. Hopefully we will watch the recovery and rebuilding progress soon.

Fall colors are coming soon. Here in Maggie Valley, you can see the colors just beginning at the tops of the highest peaks. The birches and spice bushes are turning yellow and some of the maples have a touch of red. In town the Bradford Pears are turning red on the top halves of the trees. It’s amazing to watch the colors march down the mountains in October. Full color should occur here about the 22nd of October. However, that varies with location and altitude. The great thing about fall color is if you are not here exactly at the peak, it’s usually peak color somewhere near here. If there’s not much color yet here in the valley, get on the Blue Ridge Parkway. The colors always begin at higher elevations. If the colors are past peak on the parkway, travel the lower roads. Take Hwy 215 from Canton by Lake Logan, and on toward Rosman. If colors are past peak here in the valley, try the Nantahala Skyway near Robbinsville, NC. They are southwest of us, so the colors seem to be a bit behind ours. In other words, get here from October 10th to the end of October, and colors will probably be peak somewhere.

We look forward to your visit. Stop by and say “Hello”.

August Real Estate Sales Results

Another month is already come and gone. It seems the older I get, the faster they go.

We did have an increase in the number of New Listings come on the market in August. New listings were up 17.5% from August 2021. This is good news, as we currently have a shortage in homes on the market within the Maggie Valley/ Waynesville area. This gives us a 2.4- month supply of homes on the market. This is an improvement over previous months inventory, but still definitely a “Sellers’ Market”.

Closed sales in August dropped 3.9% from August 2021, and days on the market for listed homes increased by 23.8%. The market is strong, but these numbers seem to indicate the market is leveling somewhat. The average sales price was up 5.8% from August 2021 to a price of $398,087. This was a substantial increase, but not as large as increases seen in the previous few months. Again, this indicates at least a slowing of the price increases we have seen monthly since Spring of 2020.

The average list price of homes coming on the market in August rose 3.8% from August 2021 to $421,798. This is down from the year-to-date average list price of $438,410, yet another indicator of the market leveling off a bit.

I hope these numbers help you get a feel for market conditions here. If you have any questions or comments, please let us know.

Thanks to Showing Time and Canopy MLS for the data provided above.

Agency & Agency Relationships

The buyer’s representative (also known as a buyer’s agent) is hired by prospective buyers and works in the buyer’s best interest throughout the transaction. The buyer can pay the agent directly through a negotiated fee, or the buyer’s rep may be paid by the seller or through a commission split with the seller’s agent.

The seller’s representative (also known as a listing agent or seller’s agent) is hired by and represents the seller. All fiduciary duties are owed to the seller, meaning this person’s job is to get the best price and terms for the seller. The agency relationship usually is created by a signed listing contract.

A subagent owes the same fiduciary duties to the agent’s customer as the agent does. Subagency usually arises when a cooperating sales associate from another brokerage, who is not the buyer’s agent, shows property to a buyer. The subagent works with the buyer to show the property but owes fiduciary duties to the listing broker and the seller. Although a subagent cannot assist the buyer in any way that would be detrimental to the seller, a buyer customer can expect to be treated honestly by the subagent.

A disclosed dual agent represents both the buyer and the seller in the same real estate transaction. In such relationships, dual agents owe limited fiduciary duties to both buyer and seller clients. Because of the potential for conflicts of interest in a dual-agency relationship, all parties must give their informed consent. Disclosed dual agency is legal in most states, but often requires written consent from all parties.

Designated agents (also called appointed agents) are chosen by a managing broker to act as an exclusive agent of the seller or buyer. This allows the brokerage to avoid problems arising from dual-agency relationships for licensees at the brokerage. The designated agents give their clients full representation, with all of the attendant fiduciary duties.

A transaction broker (sometimes referred to as a facilitator) is permitted in states where nonagency relationships are allowed. These relationships vary considerably from state to state. Generally, the duties owed to the consumer in a nonagency relationship are less than the complete, traditional fiduciary duties of an agency relationship.

The above is from RealtorMagazine.com

July Real Estate Sales Results

Listening to the TV pundits or reading internet articles about housing, one would think we are certainly headed for a recession. Reading the final results for July real estate sales in Haywood County contradicts this prediction of doom and gloom.

For Haywood County as a whole, new listings were down almost 22% from July 2021. (Keep in mind that inventories were low last year, pushing prices higher as buyers competed for homes in a tight market.) Closed sales were down 16.7% from last year. This was most likely caused by a smaller inventory of homes this year versus last year. (295 homes for sale in July 2021 versus 256 homes for sale in July 2022.) The average sales price of homes in July was up from $334,344 last year to $407,608 this year. (This represents a 21.9% increase in prices year to year.)

As I have speculated in previous blogs, as long as inventories remain low, and buyers’ interest remains high, prices will continue to increase, although I believe prices will start to level off in the next 30 days.

The numbers reveal we are still in a “sellers’ market” and will remain a “sellers’ market” for the near term at least.

If you are thinking about selling your home, please consider letting us guide you through the process. If you are a prospective buyer, we can help you find your little corner of these beautiful mountains.

Thank you!

Real Estate Forecast:

July 28, 2022

Catherine Mesick

Even though national GDP contracted for the second quarter in a row and home sales have fallen for five straight months, property prices are likely to continue growing because of low inventory, Lawrence Yun, chief economist for the National Association of REALTORS®, said Wednesday during NAR’s quarterly Real Estate Forecast Summit. Yun offered his economic and housing market predictions for the remainder of this year and into 2023 at the event.

One of the most unusual aspects of the current economy is the labor market, Yun said. There were more job openings than unemployed people in May—with the difference being nearly two to one, according to Bureau of Labor Statistics data. Construction job openings were at a record high in January, and these unfilled jobs point to a potential slowdown in the housing market, Yun said.

Both existing-home sales and pending home sales have been falling or stagnant for months, NAR data shows. Rising mortgage rates have combined with low inventory to exert downward pressure on the market. “Closing activity will continue to sink even more,” said Yun. “Some [potential home buyers] don’t want to pay higher monthly rates. Others can’t.”

Hope for Consumers

There are bright spots in the market, such as gradually increasing inventory, which is good news for consumers. “They no longer have to make an offer after seeing only one [house],” Yun said. “They can see three or four. It’s returning to a normal process.”

Despite some homes with high list prices beginning to languish on the market, the overall lack of inventory is still leading to price gains. “Even after reductions, prices are still higher compared to one year ago and much higher compared to before the pandemic,” Yun added.

Though the Federal Reserve is expected to hike interest rates several more times this year, Yun said mortgage rates won’t rise much further because lenders have already priced in the potential increases. This can mean increased opportunity for consumers. “We may be topping out independent of what the Fed will do,” Yun said. “Rates will go a little up and a little down. It may be a good idea to lock in when the rates are down.”

He also noted that foreign investment in U.S. real estate is still well short of pre-pandemic levels but predicted that international interest is likely to increase as travel restrictions ease.

Finally, Yun predicted that in 2022, total home sales will be down 13% from the previous year, home prices will be up 11% and total dollar volume will be down 2%. For 2023, he predicted no increase in home sales, a 2% hike in prices and a 2% increase in dollar volume.

Current Trends and Market Opportunities

Jessica Lautz, NAR’s vice president of demographics and behavioral insight, also provided data from the June REALTORS® Confidence Index. Among her key findings:

Median days on market for homes nationwide hit a record low of 14.
The average number of offers per property dipped to 3 from a previous high of 5.
Approximately 30% of buyers are waiving inspection and appraisal contingencies—a number that has held fairly steady since the start of the pandemic.
The share of all-cash buyers currently stands at 25%. This number has actually decreased from a high of 35% in 2014.
First-time buyers are still being sidelined and make up 30% of the market. Historically, they make up around 40%.

In addition, Lautz offered five “touch points”—opportunities for REALTORS® to reach out to clients in the current climate.

Twelve percent of buyers are purchasing homes virtually—and they want a REALTOR® to assist with the process.
Remote work continues to influence buying trends: 34% of buyers want features that enable them to work from home.
Consumers continue to have a skewed view of the typical amount required for a down payment. Thirty-five percent of buyers believe a down payment of 16% to 20% is required; 10% of buyers believe they need a down payment of more than 20%. However, the typical down payment for a first-time buyer is only 6% to 7%. For a repeat buyer, it’s 17%.
There is value in promoting energy efficiency in listings: Forty-four percent of REALTORS® say it’s “somewhat valuable,” and 19% say it’s “very valuable.”
Seven in 10 buyers report a desire for the latest in heating and cooling, windows and doors, insulation, lighting and appliances; however, the typical home purchased is 29 years old and unlikely to have the newest features. This disconnect presents an opportunity for REALTORS® to contact previous clients about satisfaction with their current home and any improvements they have made.

June Real Estate Results

Continuing with the same theme as last month, June 2022 was a strong month for real estate sales, and especially sales prices. Our average sales price in Haywood County jumped from $315,331 in June 2021, to $380,002 in June 2022. This represents a 20.5% increase year over year. Our total inventory of homes for sale in June 2021 was 273. In June 2022 we only had 249 total homes for sale, or an 8.8% decrease in inventory. As long as our inventory remains low, expect average sale prices to continue upward.

The average list price of a home coming on the market in Haywood County during June 2021 was $379,317. During June 2022 the average list price of a home coming on the market has risen to $486,724. This is a 28.3% increase in list prices year over year.

I keep looking for inventories to increase, which might take the pressure off sales prices, but so far, that has not happened. One reason that sales remain strong, and inventories remain low is directly related to short-term rentals, in my opinion. Investors keep buying properties and placing them in short-term rental program apps like Air BnB, or VRBO. Also, there are local real estate rental companies managing short-term rentals for investors. As long as there is this huge demand for short-term rental investment properties, demand pressures will keep inventories low, and prices will continue to edge upward.

How to Buy in a Tight Market

HOW TO

Buy in a Tight Market

Increase your chances of getting your dream house in a competitive housing market.

Get prequalified for a mortgage. You’ll be able to make a firm commitment to buy and your offer will be more desirable to the seller.

Stay in close contact with your real estate agent. Your agent will be on the lookout for the newest listings that meet your criteria. Be ready to see a house as soon as it goes on the market — if it’s a great home, it will go fast.

Scout out new listings yourself. Browse sources such as realtor.com and local real estate listing sites. Set up alerts for the neighborhoods and characteristics you’re looking for. Drive through your target neighborhoods, and if you see a home you like for-sale, send the address and listing agent’s name to your agent, who can schedule a showing for you.

Be ready to make a decision. Spend plenty of time in advance deciding what you can afford and must have in a home so you won’t hesitate when you have the chance to make an offer.

Bid competitively. Your first inclination may be to start out offering something less than the absolute highest price you can afford, but if you go too low in a tight market, you will likely lose out.

Keep contingencies to a minimum. Restrictions such as needing to sell your home before you move can make your offer unappealing. Remember that, if the market is tight, you’ll probably be able to sell your house rapidly. You can also talk to your lender about getting a bridge loan to cover both mortgages for a short period.

But don’t get caught in a buying frenzy. Just because there’s competition for a home doesn’t mean you should buy it. And even though you want to make your offer attractive, don’t neglect inspections that help ensure the house is a sound investment.

(Thanks to Realtor® Magazine for the above article.)

May Real Estate Results

In Haywood County, May continued to be a strong sales month for real estate. However, I am seeing some beginnings of a down side in this crazy market. Interest rates continue to creep upwards, making house payments more expensive, and keeping some buyers out of the market altogether. For the first time in several months, more new listings came on the market than for that same month in 2021. In April of this year, new listings were down 21.7% from April 2021. However, we had a 4.7% increase in the number of new listings when compared to May of 2021.

In May 2022 we sold 88 homes compared with 118 homes in May 2021, a 25.4% decrease. Also, the average sales price decreased for the first time in a good while to $335,920, from $366,883 last month.

Also, I am seeing price decreases on homes almost daily. For a while, we hardly ever saw a price decrease. I believe this is partially due to sellers over-estimating the value of their homes in a hot market. Those sellers are now seeing a small dose of reality setting in.

While inventories remain tight, and sales are still very good, the above numbers do represent a slight “cooling” of the market.

Will the “cooling trend” continue? I wish I knew. Stay tuned and we will see what June has in store for us.

Equity Gains for Homeowners

April Home Sales Results

I wanted to post some numbers from April 2022 sales for Haywood County, and also compare them with Buncombe County (The Asheville area) in order make all our readers aware of current market conditions.

In Haywood County for April 2022, we only had 138 new listings. This is down over 21% from the new listings in April 2021.

We only closed 98 homes in April which was 13% less than a year ago in April 2021. The decrease was mostly due to having less homes on the market this year. We only had 154 homes on the market in April 2022 compared with 234 homes on the market in April 2021, a 34% decrease in the number of homes for sale. This represents 1.4 month’s supply of homes on the market. (In other words, if no new homes came on the market, and the sales rate continued unchanged, we would be out of homes in about 6 weeks.)

The average sales price of homes sold in April 2022 was $366,883, an increase of 6.2% from April 2021. The average home sold for 99.5% of list price, so homes are pretty much selling for the listing price. (Some are still going for over list price.)

This month I will take a moment to compare the April sales results from Haywood County with Buncombe County. (The Asheville area).

Haywood County sold 138 homes in April 2022. Buncombe County sold 484 homes in April 2022. (Remember, Buncombe County is over 4 times the population of Haywood County.)

The average sales price of a home sold in Haywood County for April was $366,883. Buncombe County’s average sales price for April was $567,274. Also, the average home sold in Buncombe County for 102.3% of the original list price. In Buncombe County you almost have to offer over list price for your offer to be considered on most homes.

In Haywood County, as I mentioned above, we are down to a 1.4 month’s supply of homes on the market. Buncombe County is down to a .9 month’s supply of homes. (Less than 1 month)

I hope I haven’t bored you with numbers. If you have any questions about the market here, or are interested in buying or selling a home, please let us know. We are here to help in this bull market.