Armed with walkie-talkies and sales contracts, teams of Realtors were waiting to greet them. Tassillo jumped in the car of a waiting buyer she’d never met before and got right to business.
“I said ‘How much do you have to spend?’” Tassillo recounted.
She had scouted the development the day before, picking out choice lots in different price ranges. It was a critical strategy, because once the gates opened, time was a luxury they couldn’t afford.
The first to call dibs on a lot got it, and everyone would be racing for the best lots. Tassillo and her carload of clients for the day were soon stuck behind a snaking line of cars winding up the development roads.
So Tassillo went with plan B: ditch the car and hike, make that run, straight up the mountain to the lot she had in mind.
“And I sold the lot,” she said. “We came back down 45 minutes later and the car is still running and the doors were standing open. It was a lot of fun.”
The scene sounds like something from the real estate boom, but in fact, these sale blitzes were commonplace during the bust.
For developers, it was a way of jump-starting stagnating sales.
And for the bargain-shoppers, who were courted weeks ahead of time from the mountain feeder markets of Atlanta and Florida, the promise of limited-time-only, rock bottom deals was too good to pass up.
Tassillo, one of the owner/brokers of RE/MAX Elite Realty in Franklin, became a regular sales agent at these one-day blitzes held across the mountains during 2011 and 2012.
“Once you go to one, they all know you and it starts snowballing,” she said. “I sold land at every one of them.”
It was a tough time, and Realtors did whatever they could to survive the downturn. Not all did, however. There’s been a lot of attrition in the real estate world since the boom days.
When Carol Lynn Johnson started at Prudential real estate in Franklin in 2007, there were 275 Realtors licensed in the Franklin area. Now, there’s just more than 100.
“Sixty-five percent of the realtors aren’t in business any more,” Johnson said.
Those who’ve stayed in the game have to work a lot harder.
“I used to hear stories about people just sitting in their office taking calls as they come in and writing offers on property sight unseen. I can’t imagine that happening now,” Johnson said. “This is not for the weak of heart or weak of character.”
Johnson’s own entry into the real estate business in 2007 was bad timing to say the least.
“The month my license was conferred was the month the big mortgage crises hit the fan. I struggled,” she said.
Luckily, she wasn’t counting on the income to survive.
“If I had, that first year or two, I would have starved,” Johnson said.
Gay Moore, a Realtor with Nantahala Real Estate Company, also entered the real estate world just as the market was going south in 2007.
“Before that, it was hot as could be. Anyone who walked in bought something,” Moore said. “Now you work harder to get a deal done.”
Realtors who never knew the heyday have an advantage of sorts.
“Honestly, we weren’t used to the great boom so we didn’t miss it,” said Becky Ramey, a broker/owner at Franklin RE/MAX, who also went into real restate in 2006.
These days, Johnson, Tassillo and Ramey are among the top 10 sellers in the Franklin real estate market. So far, this is the busiest January they’ve seen.
Ramey has a wall-sized dry erase board over her desk where she tracks all her listings. It’s gotten so crowded lately, she doesn’t have room on the board for her land anymore. Volume is finally picking up, she said.
“People know the market can only go up at this point,” Ramey said, rapping her knuckles on her wooden desk for good measure.
“People know it is do or die now,” Tassillo added.
Across town, Johnson has seen the same rising tide. When a call came in from a prospective buyer last week wanting to schedule a drive around, she flipped through the pages of her desktop planner, looking for an opening among the many showings and even closings already penciled in.
“If I am starting out the year this strong, this is very exciting,” Johnson said. “I think 2015 is going to be awesome.”
Moore has seen a steady uptick in sales and prices in her niche market of Nantahala Lake property as well.
“The last two years have been good,” she said.
Values are still under their historic high — “A lake house that sold for $800,000 then is probably now worth $600,000,” she said — but are least they’re moving.
Thinking back on the 67 closings Ramey did in 2014, she wagered about half were locals and half were the out-of-town variety, be it retirees moving here or second-home buyers. It’s a different landscape than the heyday, when more than 75 percent were the out-of-town buyers.
Twice in the past week, Ramey has seen sellers get multiple bites on a house. Until now, sellers would usually only have a single buyer on the table, rather than fielding competing offers.
“That hasn’t happened much in years,” Ramey said. “That’s when it starts to transition from a buyers to a sellers market.”
It’s still a ways off, however.
Another positive sign is the receding number of foreclosures. At the market’s low point, nearly a quarter of all the listings in the greater Franklin area were foreclosures. Now it’s down to 8 percent, Johnson said.
Foreclosures had a depressing effect on the real estate market, driving down overall values. Banks were dumping a huge number of foreclosed properties on the market for cheap.
“They want to move it and there is no emotional baggage for them. They are going by a spreadsheet,” Johnson said.
As foreclosures are cleared out of the pipeline, the glut of property on the market is shrinking, allowing values to climb again.
In the meantime, some Realtors like Tassillo have gotten into the game of managing long-term rentals — an attractive option for sellers unwilling to sell at today’s depressed values. Instead of selling now at a loss, they are renting their homes until the market rebounds more.
Banks holding the bag on foreclosures are also taking that route. They’ve begun renting homes they can’t sell at a decent price, turning a write-off into a moneymaking asset until values come back up.
But no amount of waiting will help some sellers.
“If they had purchased in 2004, 2005, or 2006, they are never going to see that money,” Tassillo said.
That’s the tough choice facing sellers today.
“What I tell people, is if they need to hold out for a number it might be two to five years. They have to decide whether to hang on for that time frame, or should they go ahead and cut their losses,” Ramey said.
As for a full rebound, however? Ramey doesn’t see that happening.
“I think it would be unhealthy if it got back to where it was. We couldn’t sustain the growth that was happening,” she said.
No more rose-colored glasses
A periodic countywide property appraisal — known as the reval — squares up property values on the county’s tax rolls with real-world real estate values.
The last reval in Macon was in 2007 during the height of the mountain real estate rush, when second-home buyers, dreamy retirees and high-rolling speculators sent property values soaring into the stratosphere.
There’s been widespread carnage in the real estate market since then. The much-anticipated reval captures the broad stokes of the Macon’s boom-and-bust. Here’s some top data points to come out of the just-released reval.
This is the closest dollar figure we have on how much the real estate market crashed as a whole in Macon County. A staggering $1.2 billion in real estate value has evaporated since 2007. The homes, land and lots are all still here, of course, but it’s worth a lot less now. Collectively, the value of real estate in Macon fell from $8.9 billion to $7.7 billion over the past eight years — a 15 percent drop on average.
Despite a crash in property values over the past eight years, we’ve finally turned the corner. In a reval forecast issued this time last year, property values were tracking 25 percent below 2007 values. But the gap closed in 2014. Values are now only 15 percent lower, a 10 percent rebound compared to 2007 values in a year’s time.
The year the market hit bottom — 2011 had the lowest average sales prices and the least number of valid real estate sales.
The number of valid real estate sales are up substantially: more than 700 sales were recorded in 2014 compared to 420 sales in 2011. Valid sales don’t count foreclosures, short-sales, auctions or transactions between family members or neighbors.
Lots in mountain subdivisions were once all the rage, but went out of style faster than butterfly collars. Lot sales have seen only a meager recovery. The number of lots sold increased by only 10 percent from the trough of 2010 to 2014, lagging behind the rebound in home sales.
Lot sales once outpaced home sales, but now account for only a quarter of valid real estate sales — fewer than 200 lots sold in 2014 compared to 500 homes that year.
The number of home sales doubled — a 100 percent increase — between 2011 and 2014. Home sales have carried the real estate market recovery, compared to the has-been champion of land.
Sales of high-dollar homes — those over $500,000 — have more than doubled since 2011. Less than 30 sold that year, but more than 60 sold in 2014.
Moving up a notch to the over $1 million bracket, 25 homes sold last year — a four-fold increase over 2011 when only six homes sold in that range. And in the upper echelon — homes over $2 million — there haven’t been many sales, but the number on the market is growing. There were 25 homes listed on the market for more than $2 million in 2014, up from about 10 the year before.
Homes and lots sold in 2014 that sold for 20 percent less on average than what they were worth in 2007, when the county finished its last reval at the peak of the boom.
Property values soared during the mid-2000s. The last reval before this one was done in 2007. It showed a 69 percent increase in real estate values in the four-year period from 2003 to 2007.