WNC home prices set records in 2023, Asheville up 53% since 2019; solutions ahead?

ASHEVILLE - Asheville's housing market hit an all-time high in 2023 — setting a record median sales price of $485,000. Yet, our "Blue Ridge nestled" city is not alone — at least in Western North Carolina.

In addition to a $460,000 median home sales price in Buncombe, much of WNC saw record prices. Henderson, Madison, Haywood and Transylvania counties all saw the highest median home prices on record in 2023, with Transylvania even exceeding Buncombe's, according to reports compiled by the Asheville-based Mosaic Community Lifestyle Realty.

Since 2019, Asheville's median home sale prices have increased from $316,000 to $485,000 — a 53% increase. The number outpaces the national 48% increase over the same period, where median sale prices increased from $272,830 in January 2019 to $403,164 in December 2023, according to Redfin.

For some, the news may not come as a surprise.

Prices steadily rose throughout 2023, bringing reports of high prices — amidst 23-year high interest rates — nearly each quarter.

Asheville Vice Mayor Sandra Kilgore told the Citizen Times that despite limited inventory and many looking to move to the area, she felt a change could be coming. Kilgore, who grew up in the Southside neighborhood, has been a realtor for over 30 years.

Kilgore noted that when the market was more active, some home buyers skipped inspections to buy quicker. Now, prospective buyers seem to be measured in their purchases.

"I will say, list price and as far as what (homebuyers) are actually getting for the properties, that sort of still remained the same," Kilgore told the Citizen Times. "But I saw a change as far as how people negotiate for them."

The city of Asheville's record median sale price of $485,000 is $30,000 more than 2022's reported price. Yet, the rate home prices are increasing has gone down.

The 6% increase from 2022 to 2023 was not as significant as increases in recent years. From 2021 to 2022, Buncombe County home median sale prices increased from $400,000 to $455,000 — a 13% increase.

Mike Figura, owner of the Asheville-based Mosaic Community Lifestyle Realty, noted how the year continued to be heavily controlled by interest rates.

"It felt like a year that was uncertain because interest rates were all kind of all over the place," Figura said.

Despite consistent fluctuations throughout the year, prices steadily rose throughout 2023. In October, interest rates hit a 23-year high, but month-to-month fluctuations weren't as impactful on pricing, Figura noted.

"The pricing was not as elastic as the interest rates were," Figura told the Citizen Times. "I think people were trying to make sense of the market all year and the market was a moving target."

Interest rates for an 30-year mortgage ended at an average 6.69% the week of Jan. 25, down over a percentage point since October, according to Freddie Mac, the Federal Home Loan Mortgage Corporation chartered by Congress in 1970.

As for housing supply, Figura noted that Asheville is "in the camp" of supply not keeping up with population growth.

"We had a decade of population growth without enough construction happening," Figura said. "At the same time, running out of easy land to build on, so land prices going up, construction costs going up and a lack of construction happening."

Between 2010 and 2020, Asheville's population grew by 13.4%, and is now estimated at just under 94,000, according to U.S. Census estimates.

Buncombe County, City of Asheville, local nonprofits look to find solutions

The record home prices certainly don't exist in a bubble.

Just Economics of Western North Carolina recently raised the Buncombe County living wage to $22.10 — around a 9% increase. The decision was cited to primarily be the result of rising housing costs, as reported by the Citizen Times.

Other projects in 2023 saw nonprofits take action to target the problem.

BeLoved Asheville work to build deeply affordable tiny homes targeting those who make 30% of the area's median income. Another Asheville-based nonprofit, Mountain Housing Opportunities, received City Council approval for a 60-unit 100% affordable housing project off of Tunnel Road. Others are looking to preserve historic buildings by converting them to affordable housing.

Some government officials, like Kilgore, see the lack of housing supply as one of the major reasons to vote "for any housing development that comes in."

"Because you've got to understand, the only way you are going to be able to control rent costs is, you know, supply and demand," Kilgore said.

As for Buncombe County officials, the Ferry Road development represents another method of providing housing — subsidizing and planning a distinct, five section development with the goal of 55% of the units being provided to those with lower area median incomes.

"You know, we're like 5,000 units short in our community — period," said County Director of Economic Development and Governmental Relations Tim Love.

The project would bring a new county-backed mixed-income development to Asheville. The goal is to help shape development by offering county property, rather than trying to influence developers on their own projects, Love said.

"We just had this light bulb moment where it's like we've got assets like land, parking lots — we need to put those things into play," Love said. "That's our leverage out there."

Depending on funding, the total number of new housing units from the development could fall within a range of anywhere from "500 to 900," but 650 units of housing is the "sweet spot" for the development, Love told the Citizen Times.

"It could be a much smaller project for about 500 units or it could be — based on the range — 900 units, but we don't envision 900 units is realistic at all," Love noted.

When completed, the goal is to have around 55% of the units subsidized for those who are making anywhere from 30% to 80% of the area median income.

Currently, the Asheville AMI is $59,500 for one person. For those earning 30% of Asheville's AMI, they would make $17,850 a year.

The project will include a mixture of both apartments and single-family homes. County officials realized both were important when forming the project goals.

"We need to create units that are affordable, but we also need to create homeownership opportunities so people can accumulate wealth," Love said of the process designing the project.

Love noted that the project is a "housing project with conservation at the heart," where over half of the French Broad River adjacent parcel will be conserved.

Median home sales prices for five WNC municipalities in 2023

Here are the median sale prices for five WNC municipality. All data is from regional Mosaic Community Lifestyle Realty reports:

• Asheville (Buncombe): $485,000

• Waynesville (Haywood): $345,000

• Hendersonville (Henderson): $448,000

• Marshall (Madison): $450,000

• Brevard (Transylvania): $450,000

Median home sales prices for five WNC counties in 2023

Here are the median sale prices for five WNC counties. All data is from regional Mosaic Community Lifestyle Realty reports:

• Buncombe: $460,000

• Haywood: $373,000

• Henderson: $391,000

• Transylvania: $468,000

• Madison: $391,000

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Will Hofmann is the Growth and Development Reporter for the Asheville Citizen Times, part of the USA Today Network. Got a tip? Email him at WHofmann@citizentimes.com. Please help support this type of journalism with a subscription to the Citizen Times.

This article originally appeared on Asheville Citizen Times: Asheville home prices have increased 53% since 2019; more supply soon?