The recovery from the 2008 real estate market crash continues to make strides as the calendar marks 12 years since the historic crash.
Local market pundits say their continued strategy of moving cautiously forward helps prevent history from repeating itself.
Highlands-Cashiers Board of Realtors President Julie Osborn of Pat Allen Realty Group said the local real estate market reflects the sign of the times.
“We are seeing more and more people move to the plateau to be full-time residents due to the appeal of the climate, low crime rates and the lower key lifestyle offered,” Osborn said on Thursday. “My gut tells me we are not going to be a ‘seasonal’ economy much longer. In contrast to the past, buyers are looking and purchasing homes in what we used to call our ‘off season.’”
Osborn said the local real estate market is still a buyer’s market, according to statistics.
“A balanced market is considered six months of inventory in the real estate world,” she said. “Anything greater than six months of inventory is considered a buyer’s market and anything less than six months of inventory is considered a seller’s market.”
Locally, Osborn said the market was at approximately 9.4 months of inventory in the area, “Which indicates our market is still a buyer’s market,” she said.
But the inventory is shrinking.
“Yes, our inventory is shrinking in comparison to previous years,” she said. “My guess is this trend will continue.”
Robust economy forecast
The indicators all point to a growing economy locally, Osborn said.
“According to the U.S. Bureau of Labor Statistics, the unemployment rate in 2008 was 13.2 percent,” she said. “In November 2019, the U.S. Bureau of Labor Statistics reported the unemployment rate nationwide as 3.5 percent. That’s almost a reduction of 10 percent. We’ve come a long way since the crash of 2008 and I think we all learned lessons from it.”
Osborn didn’t know of a single industry that wasn’t impacted in some way by the recession of 2008, that didn’t suffer during and afterwards.
“It was catastrophic to multiple industries on multiple levels,” she said. “We are obviously in much better shape than we were in 2008.”
Nationally, home sales climbed 3.6 percent in December 2019, according to the National Association of Realtors, but a record-low inventory of houses on the market has caused prices to surge as affordability is worsening.
Home inventories shrinking
According to the NAR, sales of existing homes rose last month to a seasonally adjusted annual rate of 5.54 million. For all of 2019, 5.34 million homes were sold — matching the 2018 level. High mortgage rates hurt sales in the first half of the last year, while lower rates boosted purchases in the second half.
But the rebound in sales failed to cause more people to put their homes on the market, according to the NAR. Sales listings have tumbled 8.5 percent from a year ago to 1.4 million properties. There are just three months’ supply of single-family houses for sale, the lowest level since Realtors began tracking the number in 1982.
Inventories have fallen at all price levels below $1 million for the past year.
The median sales price has jumped 7.8 percent over the past year to $274,500. Home values have increased at more than double the pace of wage growth.
In December, sales rose in the Northeast, South and West, but sales fell in the Midwest, which is generally a more affordable market.
Osborn said the real estate market on the plateau bucks the national trend.
“We are definitely in the middle of a buyer’s market up here because of our inventory,” Osborn said. “But again, that trend is starting to shift.”
Home sales up
Highlands Cashiers MLS homes sales reflected another upward trend in 2019, said Highlands-Cashiers MLS President Marty Jones.
“The average home price rose from $655,423 in 2018 to $683,066 in 2019,” he said. “The number of homes sold rose from 694 in 2018 to 709 in 2019, and the gross dollar volume of homes sold in 2019 was $484,294,113, compared to $454,863,627 in 2018.”
Jones added, “While the percentages of increases in gross dollar volume, number of homes sold and average home prices are not astronomical, it does show slow, healthy growth beginning post-recession in 2013.”
While two years, 2015 and 2017 saw slight drops in average homes sales prices, the number of homes sold and the gross dollar volume was still on the plus side for those years, Jones said.
“But, 2018 and 2019 saw increases in averages sales price, gross dollar volume and number of homes sold.”
In short, the local real estate market is in good shape, he said.
Looking ahead
“While it’s too early to tell, 2020 appears to be on pace to reflect another positive year in the Highlands Cashiers real estate market,” Jones said. “For the same year-to-date in 2019, Jan 1 - Jan 24, there were 26 homes sold at an average sales price of $579,481. In 2020 for the same time period, there have been 38 homes sold for an average price of $694,439 in 2020.”
Jones pointed out two new upscale developments in the area, the High Hampton project, and GlenCove, a new wellness and agrihood community by Old Edwards Hospitality Group.
“In the past, we’ve seen increased volunteerism and charitable donations from similar new communities, as well as spin off real estate sales,” he said. “I anticipate that to be the case with the current new projects.”
Like other professionals in southern Jackson County, Jones believes with the new Horsepasture River sewer facility getting underway, will mean good news is in store for both the commercial and residential real estate market in the area.
“The increased sewer capacity in the works for Cashiers will help provide some boost to the Cashiers Commercial District, but while there are many vacant land opportunities within the district for new commercial construction, we have not seen a significant jump in commercial unimproved sales in the Cashiers Commercial District,” he said. “There has been residential growth in the commercial district, filling a niche for buyers who desire to be within walking distance to shops and restaurants, but most commercial sales in the past two years have been sales of existing businesses or facilities.”
Jones is owner/broker of RE/MAX Summit Properties in Cashiers and has been a full time real estate broker in the Highlands Cashiers area since 1986, and has been a full time resident of Jackson County since 1974.
Good times coming
Stephanie Edwards, executive director with the Cashiers Chamber of Commerce gave props to Interim Tuckasiegee Water and Sewer Authority Interim Executive Director Dan Schaeffer for his quick work in getting the new facility back on track. She said the impact of the new Horsepasture River Wastewater Treatment Facility is immeasurable.
“We’re pleased with the recent engineering progress on the new wastewater treatment plant made under the direction of Interim TWSA Executive Director Dan Schaeffer,” Edwards said. “This facility will provide additional local allocation needed to support responsible growth. It also will help protect our pristine natural resources which could be threatened in the future by aging or failing septic and community systems.”
Edwards looks forward to the potential growth on the horizon.
“We look forward to inevitable growth as measured development which enhances the character of our community, respects the environment, and expands our economy for year-round prosperity,” she said.
Osborn said the local market will continue to thrive in 2020.
“With the robust economy, low interest rates and low unemployment rates we’re seeing, I feel the real estate market will continue to be strong in our area.”
The Highlands-Cashiers Board of Realtors is a nonprofit trade association with approximately 300 members, serving southern Jackson County, southern Macon County and surrounding areas in North Carolina.