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Recent events in our economy have revealed what was known by experienced real estate agents for a long time - property values had exceeded sustainable levels. Another underlying cause for the economic woes was that credit was being extended to those unable to repay the mortgage. Having these “under qualified” buyers enter the real estate market served to exacerbate the problem of rising prices and not enough inventory. An article by Steven A. Holmes in The New York Times published September 30, 1999, declared that “Fannie Mae eases credit to aid mortgage lending”. The article stated ” in a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders”. The stated purpose of this program was to give mortgages to individuals whose credit was not good enough to qualify under existing conditions for a conventional loan. Does anyone else see a problem here? Although the contenders for blame are many, this one stands out.

 After directing Fannie Mae to ease credit restrictions in 1999, the Department of Housing and Urban Development proposed that by the year 2001, fifty percent of Fannie Mae and Freddie Mac’s loans be to low and moderate income groups. There were racial overtones to this rationale, admitted to by Fannie Mae officials, but I dare not go there. Suffice to say, these decisions made in the “roaring 90’s” have been a major contributor to the economic melt-down. Home ownership never has been a fundamental right. It is a privilege extended to those who can afford it.

During the boom years extending from the 90’s into the first half of 2007, home ownership was within anyone’s grasp who was breathing and had some verifiable income. In many areas, houses were in short supply. As inventory stayed low and demand increased,  prices for available homes soared well beyond levels which could be sustained. With the collapse of easy mortgage money and  bank foreclosures on loan defaults, the real estate market bubble burst.

As stated in one of my earlier articles, Black Mountain had largely escaped the real estate market collapse experienced by many areas around the country, although home prices have decreased slightly over the last year. For buyers, this is a unique opportunity, since a decline in property values in our area is rare indeed. My confidence level is high that those with good credit and high income to debt ratios will benefit by the current economic slow-down. Mortgage money is available to those who can qualify under the tighter lending guidelines. As of this writing, there are over two hundred homes available within the Black Mountain zip code listed in the MLS. The selection of homes has never been better nor prices more attractive. The “sky is not falling” on the real estate market in the Swannanoa Valley area. Buying real property has been and will always be the most secure long-term investment that one can make. Buying the right property, in the right area, at the right price will always be a wise investment decision. Now is a great opportunity for buyers with wisdom.

Submitted by Sid Blake for publication in the Black Mountain News.

It’s official!  The nights are getting chilly and I have retired my vibrant sundresses and flip flops for cozy sweaters and boots.   Yes folks, fall is here in all its glory. 

The time has come once again for harvest festivals, county fairs, and homecoming football.  Pumpkins, winter squashes, and decorative gourds have replaced the sweet corn and tomatoes of summer at farmers’ markets and roadside stands, as splashes of vibrant reds, oranges, and golds spread across the mountains.  Almost overnight the mountains of Western North Carolina have made their yearly transition into an autumn wonderland. 

This brilliant foliage display normally continues from September through late October, drawing over a million people to the Blue Ridge Parkway each fall to enjoy the natural beauty.  As a bonus, due to recent weather conditions, this year is predicted to be one of the best fall color displays in recent memory; all the more reason you should plan your family’s fall getaway to the Asheville area mountains! 

It’s not often that governmental action results in tangible savings for the masses. It has been my experience that when our government becomes involved with the handling of money, the end result is worse than before. However with the government takeover of Fannie Mae and Freddie Mac comes an opportunity for buyers to cash in on a bargain. Only last week 30 year loan rates were averaging 6.19%. As of this writing, rates on a 30 year fixed rate had dropped to an average of 5.79%. That’s a huge drop in just one week. Combined with good inventory and lower home sales prices, this is the best news for buyers in many years. The motivating factor of this precipitous drop was the government’s intervention to take over these two “quasi-governmental” agencies. The forming of two separate conservatorships with government backing of $100 billion dollars committed to each will continue to have an impact on the mortgage and housing markets for a long time.

Homeowners will benefit from this governmental intervention. Those with adjustable rate  or high interest rate mortgages can refinance at the new lower rates. No one knows how low rates will go, but my guess is that they should continue to drop slightly or hold steady for a while. Since money will be cheaper, sellers will benefit also; since more buyers will qualify for the lower mortgage payments. To me, the government’s “bail out” of Freddie Mac and Fannie Mae is a big win for the real estate industry, although my opinion is in conflict with much of what I read from some of the real estate prognosticators.  My guess is that in the next few months we will see a surge in real estate sales in our area. This is the natural course of events when interest rates fall and housing prices are down. Those who are prudent will seize this opportunity that came with the mortgage crisis. My life experience is that with every crises comes opportunity. There will be some who see it as such and act accordingly, and others who just watch, wait, and miss the boat.

Buying real estate, especially for a primary residence, has always been a good investment. Because there have been market fluctuations, buying real property should be looked at as long term. The “flipper” days are done for now, but my bet is that they will return. Rarely has anyone lost money in real estate who invested for the long run. In our area particularly, it would be difficult to lose money on a home purchase. It is true that those who purchased a couple of years ago will find the smallest appreciation, or maybe none, but this will change. Home ownership is still one of the very best investments one can make. Not just for capital gains sake, but many personal reasons. Bottom line on all this is that a door has been opened by the Freddie Mac and Fannie Mae debacle. How long it will stay open is anyone’s guess. What can not be avoided is the fact that now is the best time for anyone who has considered buying a home to make the purchase. Don’t miss the boat!

Written and submitted by Sid Blake, Broker, ERA Pinnacle Properties.

Welcome to the Black Mountain Real Estate Blog!

As part of our commitment to provide you with an exceptional real estate experience we at ERA Pinnacle Properties have created our Black Mountain Real Estate Blog .  We are very excited because this gives us another platform to share our knowledge with you!  We will be writing about all things Black Mountain and the surrounding communities, because we love where we live and we want you to love it too. 

Be sure to visit the Black Mountain Real Estate Blog frequently to find valuable, up to date information pertaining to Black Mountain Real Estate, featured Western North Carolina communities, tips for buying or selling your home, and many of the attractions and events that the greater Asheville, NC area has to offer. 

Most importantly we want to hear from you!  Don’t be afraid to click on “Leave a Comment” to let us know how we’re doing, ask questions, or especially if there is a topic you would like for us to feature.  Whether you’re wanting to know more about the Black Mountain real estate market, or just where to get the best BBQ, we want to be your number one source for information on all things pertaining to Black Mountain and the surrounding communites.