Missing Middle Housing: How Zoning Rules Are Keeping Asheville Unaffordable

Zoning, not a shortage of good jobs, was the culprit at AVLmeetup's third annual Affordable Housing panel, held in August 2024 at The Mule at Devil's Foot Beverage. Barry Bialik of Compact Cottages and the Thirsty Monk, Vaidila Satvika of the City of Asheville's planning department, and Kelly Allen of C&T Real Estate School walked 98 attendees through why the math on a median Asheville home stopped working, and what could fix it.

Key Takeaways

Zac Ruiz's Ruiz Report data showed Buncombe County's median home price at $485,000 in July 2024 (average close price $660,000), against a median family income of $90,310. A median-priced home financed with 3.5% down ate up about 53% of real after-tax household income, well past the FHA's recommended 43% debt-to-income limit.
Vaidila Satvika said two-thirds of Asheville's residential land allows only single-family detached homes. Barry Bialik, reading from a city of Asheville article quoting Satvika, noted the city's last zoning change meant to support housing dates to August 17, 2017.
Barry Bialik built his first Asheville house, on Craven Street across from what is now New Belgium, for $68,000 on a $17,000 lot, a full package under $100,000. The house still stands.
Asheville's Planning and Zoning Commission has approved raising the accessory dwelling unit size cap from 70% of the primary home (as little as 500 square feet on a typical 700-square-foot house today) to 1,000 square feet, and separately cleared "backyard lots" for the first time. Both still need Asheville City Council approval.
One of the panelists pointed to Houston, which cut its citywide minimum lot size from 5,000 to 1,400 square feet in 1998 with no neighborhood carve-outs and stayed comparatively affordable as other major cities got pricier.

How Buncombe County's Housing Math Stopped Working

In July 2024, Buncombe County's median home sold for $485,000 while its median family income was $90,310, a gap Zac Ruiz's Ruiz Report data laid out at the top of the night. Financed with an FHA loan at 3.5% down, that home carried a monthly payment of roughly $3,233, almost exactly the FHA's recommended debt-to-income ceiling of 43% of pretax income. But pretax income is not what anyone spends. Measured against real, after-tax take-home pay, that same payment consumed about 53% of the household's money each month.

"The median family income cannot support the median home price in Buncombe County," Rodrigo Afanador told the room, presenting the Ruiz Report's numbers. He walked through why the county can't build its way to lower prices with the usual levers: production costs, technology, and the broader economy are outside a local audience's control, and the mountains mean there is no more land to add. That leaves one lever cities can actually pull: zoning, which is where the panel picked up.

Why Asheville's Zoning Code Only Allows One Kind of House

Two-thirds of Asheville's residential land allows only single-family detached homes, Vaidila Satvika said, calling it a restriction the city "should have changed yesterday." Right now, an accessory dwelling unit can be at most 70% of the primary home's size, so a 700-square-foot house can only add a 500-square-foot ADU. The Planning and Zoning Commission has already approved raising that cap to 1,000 square feet, and it has cleared "backyard lots," which let an interior lot reach the street by easement instead of owning road frontage. Both changes still await City Council action. Reading from a city of Asheville article that quoted Satvika, Bialik noted that August 17, 2017 was the last time the city changed its code to support more housing.

One of the panelists traced the resistance back to Euclid v. Ambler, the 1926 U.S. Supreme Court ruling that made zoning constitutional. Writing for the court, Justice George Sutherland described apartment dwellers as "parasites," and the panelist said Asheville's own 1922 planner, John Nolan, argued that neighborhoods like Beaver Lake needed protection from the same group.

Fear Is the Real Obstacle, Panelists Said

"So there's one word. It's called fear," Barry Bialik said, describing why more zoning changes have not passed. Neighbors fear what gets built next door, and city council fears losing reelection over an unpopular vote. Satvika pointed to Montford as proof the fear is overblown: the neighborhood already mixes single-family homes with triplexes and small apartment buildings, and nobody treats it as a cautionary tale. Bialik added that building in Montford still costs thousands more because of extra restrictions specific to that historic district.

Bialik also shared Asheville's density numbers: the city covers 45 square miles with 95,000 people, a density of 2,080 people per square mile. Carrboro, North Carolina's densest city, packs 21,000 people into 3,288 per square mile. San Francisco, roughly Asheville's size, holds 18,000 people per square mile. His conclusion was that "car math needs to change" before infrastructure objections override the need for more housing, and he asked attendees to show up when the city considers two UDO changes on September 10.

Questions From the Room

What would convince a skeptic that density is being done responsibly? An attendee who has lived in West Asheville for 25 years cited the roughly 600-to-900-unit Crossroads and Home Depot Smoky Park developments feeding traffic onto Sand Hill Road, and asked for enforceable infrastructure commitments before more units get approved. Bialik said the city needs to stop "thinking in car math," and Satvika added that bus rapid transit, not more roads, is the realistic long-term fix.
How do variance hearings and impact fees actually work in Asheville? An attendee asked how a project gets approved for more density and whether developers pay impact fees. Satvika said North Carolina's legislature does not permit true impact fees, but the city allows conditional zoning, which he called "basically legalized horse trading" between an applicant and council. Bialik added that density bonuses exist for projects with affordable or sustainable elements, avoiding a variance hearing entirely.
What is the city doing to support private investment in affordable housing? An attendee who said he owns four apartment complexes in Houston, working with a tax-abatement program there, asked what Asheville offers developers in exchange for affordability commitments. Bialik pointed to the city's own tax-abatement program for owners who commit to affordability standards, but said the bigger constraint is funding: Asheville's housing trust fund can only offer low-interest loans, not grants, because of the city's limited budget.

The night closed with a pointer back to the Ruiz Report for market data and to REMC.co for real-time MLS analytics. AVLmeetup's next event, on September 5, 2024, was Funding Your Next Deal.