Tough market rental in Black Mountain
Several people that Charlie Sparks is building houses for in Black Mountain are interested in making a little money on the side. Or in the basement.
“They’re always asking me about putting in a garage (apartment) in back or a studio apartment on top of the house or in the basement,” said Sparks, whose Black Mountain Bungalow Co. builds Craftsman-style homes around town. He sold a house in September — it was on the market a total of eight hours — that has an apartment in the basement that the buyers planned to rent out.
“They want to mitigate the mortgage payments,” Sparks said.
His experience — of people incorporating rental property into the houses they’re building - might be unusual in Black Mountain, according to other interviews done for this story. But it’s indicative of the tight rental market in the Valley, one that’s largely unseen and unnoticed by everyone except those looking for a place they can afford to rent.
They better than anyone else know how tight the market is. A 2014 housing-needs analysis of Buncombe, Henderson, Madison and Transylvania counties commissioned by Asheville City Council cited an apartment vacancy rate of just 1 percent.
“For rent” signs in the Valley come down almost as soon as they go up, and many never make it up at all. Many rentals these days are handled online, which both fosters and accelerates the demand for rentals in the area. Some aren’t advertised at all. Gail Freirich doesn’t advertise.
“We just do word-of-mouth,” she said. She rents a couple of studio apartments in North Fork and never has a problem getting them rented, possibly because she charges $450 a month for two rooms, a kitchen and a bathroom.
Someone who rented from her in the past is searching for a place in the area for about $750. But she’s not having any luck, Freirich said she told her. “It’s a pretty tight market, according to her,” Freirich said.
“Very, very tight” is what Chip Craig, owner/broker of Greybeard Realty and Rentals in Black Mountain, called the rental market.
“We are near zero vacancy. Demand far exceeds supply for rental homes,” he said. But though his company has some homes with separate rental units, he’s not seeing many instances of people folding them into their building plans.
Neither is Sean Sullivan, president of Black Mountain-based Living Stone Construction and the 2015 president of the North Carolina Home Builders Association. He agreed that the housing and rental markets in the area are exceedingly strong.
“Everybody wants to be here, as we keep making all the top ten lists,” he said, alluding to Asheville’s frequent presence on lists of the nation’s most livable cities.
Sullivan segmented the home ownership market into three general categories: starter homes, move-up homes and homes built for retirement. His company focuses on move-up and retirement homes. People don’t often build rental units in homes in those segments, he said.
Because building is so “expensive,” rental space is usually made out of existing homes, he said.
“People will buy a house before they will build a house if they’re in that starter market,” Sullivan said. “Typically the move-up and retirement market is your new construction.” He mentioned a home he built a decade ago that he recently renovated to include a section for additional family members - or, potentially, for use as a rental unit.
The town of Black Mountain doesn’t have regulations regarding rentals or the zoning districts in which they’re allowed, said Jennifer Tipton, Black Mountain’s zoning administrator. “We currently have residential structures in all districts except for the light industrial (district), which is solely Ingles warehouse,” she said.
The town doesn’t require occupancy permits for rentals, she said. But if an owner wanted to modify a garage to include an apartment, he’d have to apply for a building permit, she said.
Like Sullivan, Tipton isn’t seeing a wave of rental units being built into new construction.
“We might see some rough-in plumbing or electrical for a basement or a garage that could later be turned into a rental unit,” she said. The town typically would not need to be made aware of housing with rooms designated for rental unless it were part of a motel, hotel or inn.
“What we are seeing here is more people renting out whole houses, basement apartments, garage apartments or building secondary dwellings to use as rentals,” Tipton said.
Sparks said interest in having an income-producing apartment in a home is building.
“The market is so strong that no one questions whether you would be able to rent it,” he said.