As I anticipated last month, based upon the higher numbers for Conditional and Pending home sales in our Lake Norman area, we posted some relatively strong sales numbers in December when compared to last year and even the year prior to that:
The total number of Lake Norman single family homes under contract (but not yet closed) on December 31, 2010 totaled 141 compared to November 30, 2010’s 169 which is a drop of 17% from last month’s high and 10% lower when compared to August’s and July’s numbers of 157, and 17% below June’s 169. It would appear that after 2 months of increases January 2011 closed sales will most like dip below January 2010 sales.
Here are the details:
- Active Listings dropped another 12% from a year ago. Based upon our December closed sales, we now have 12.2 months of inventory. While our goal of a truly balanced housing market of 6-8 months of supply is still out of reach, for the second month in a row, this is the strongest absorption rate we have had since I started doing these sales analysis in early 2007. Clearly we need to have a combination of increased sales and decreased levels of active listings in order to return to a balanced market and with my anticipated drop in January 2011 sales our months of inventory will most like increase next month. However, it is very good news that our inventory is continuing to shrink to record lows each month. Note that the average price of our active listings dropped 20% compared to November 2009. We continue to see a number of price reductions and perhaps a retracting of higher end sales.
- Contingent Sales, which don’t account for a signifcant segment of our housing market, increased by113%. This is an interesting jump and may be a result of very anxious sellers who are willing to accept an offer with a buyer’s contingency to sell another home.
- Conditional Sales increased 23 % this month when compared to December 2009. These are homes that just went under contract and still have financial and inspection conditions. They will represent closed sales in either late January or February and would seem to indicate that the sales in Lake Norman, after a possible drop in January will experience a slight improvement in February.
- Our pending sales represented a 12% decrease from a year ago. These are the contracts that are past inspections and are just waiting to close. Pending sales are usually the best indication of closed sales in the next few weeks. These numbers would indicate that our closed sales this month will be slightly lower than both last month and January of 2010.
- The number of closed sales increased 20% compared to 2009 and our average price was DOWN 24%. We truly ended 2010 on a high note. However, the dip in the number of Lake Norman homes under contract seems to indicate that our string of double digit sales increases is over. It is also interesting to note the significant drop in the average sales price after many months of increases. Are our higher-end home sales slowing down? Let’s take a look:
Here is a breakdown by price-range of our December 2010 closed sales in Lake Norman’s area 13- to 13-5:
- $22,000 – $199,999: 13 (Conditional, Cont & Pending = 22)
- $200,000 – $299,999: 16 (Conditional, Cont & Pending = 29)
- $300,000 – $399,999: 19 (Conditional, Cont & Pending = 24)
- (Solds were 57% compared to 50% last month)
- 400,000 – $499,999: 8 ( Conditional, Cont & Pending = 16)
- $500,000 – $599,999: 8 ( Conditional, Cont & Pending = 12)
- (Solds were 19% compared to 20% last month)
- $600,000 – $699,999: 7 ( Conditional, Cont & Pending = 12)
- $700,000 – $799,999: 4 ( Conditional, Cont & Pending = 3)
- $800,000 – $899,999: 4 ( Conditional, Cont & Pending = 4)
- $900,000 – $999,999: 2 ( Conditional, Cont & Pending = 2)
- (Solds for $600,000 – $1mill = 20% compared to 19% last month)
- $1,000,000 – $1,999,999: 3 ( Conditional, Cont = 6 & Pending = 10)
- $2 million+ : 0 ( Conditional & Pending = 1)
- (Solds $1million+ = 0 compared to 11% last month)
- (Total Conditional, Contingent and Pending = 141)
In October, 61% of our Lake Norman home sales were under $400,000 and 77% were under $600,000. In November 51% of our home sales were under $400,000 and 68% were under $600,000. Last month 57% of our home sales were under $400,000 and 76% were under $600,000. It looks like our lower price ranges are gaining market share again. The one number that remains high is the Lake Norman homes currently under contract over $1million but under $2 million. What is a bit perplexing is that this number has been high for the past three months yet they don’t seem to be translating into closed sales. Something to watch for this month.
6-Year Comparison of Lake Norman Home Sales By Month
* Please note that all of my numbers come from the Charlotte Region Multiple Listing Service and will not include sales that took place outside of our MLS.
**I have made an adjustment of the totals reflecting the ACTUAL sales every month in 2009 and 2010 and the totals in the prior calendar year. The columns may not add up but I do my best with what I have to work! I also adjust past months when I do the monthly update as a few more sales are usually input late by agents.
Here is a snapshot of Lake Norman home sales numbers in the context of the past 6 years. As I said above, our 2010 December 2010 sales were 20% higher than 2009 and 45% greater than 2008. They were the strongest December since 2006!
We ended 2010 on a high note: 16% higher annual sales than 2009, 3% higher than 2008 but 38% lower than 2007 and 51% lower than our peak year 2005.
It looks as if this month will just about match January of 2010 rather than show a double-digit increase as we have been experiencing. Most pundits feel 2011 is going to be very similar to 2010. I tend to agree with one exception for our Lake Norman housing market. IF we can keep inventories down and not see a marketed increase in the spring we may experience a slow stabilization of our overall market.
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