I don’t know about you, but I welcome good news of any kind these days. The fact that our Lake Norman home sales have not only picked up but have had two positive months in a row with indications of more to come is almost GREAT news!
It is important to note that these numbers are only as good as the agents who report them. Expect an adjustment in our 57 sales in February upward perhaps two more sales by the end of the month since it takes some Realtors several weeks to actually input their sales into our MLS. I create these reports early in the month while the information is still very fresh so always pad the sales upward just a bit.
Here are the February 2012 numbers from our Charlotte Multiple Listing Service for our Lake Norman area real estate market:
Some significant additional interesting statistics for you:
- “Distressed sales” ( Foreclosures (REOS), defaults, Short Sales) comprised 21% of our closed sales in February down from 31% last month, 36.7% in December, 36% in November, 19.8% in October, 10% in September, 16.8 in August, 18.5% in July, 25% in June and 27% in May. The US average is 24%. The price range of these distressed sales was$40,500 – $350,100 with NO waterfront homes included. And, our percentage of distressed active listings dropped to a new low of 7.4 % down from 9.5% last month and 10.9 % in December which indicates that our ratio of distressed new listings is actually decreasing. We are not being bombarded by foreclosures and shortsales so far in 2012 as some had predicted.
- 32% of our closed sales were waterfront homes up from 22% last month. Again, there were no closed sales of distressed waterfront properties in February and there are currently only 27 distressed waterfront properties for sale in all of Lake Norman out of 350 or 7.7%.
- 49% of our February Lake Norman home sales were under $400,000 compared to 60.9 % last month. 70% of February sales were under $500,000.
- Our average price is up for closed and conditional sales.
- On March 1st the number of active listings for all of Lake Norman totaled 856 up slightly from 811 on February 1st and our low of 752 on January 1st. To put this number in context, back in June of 2008 we had 1789 active listings.
A closer look:
- The number of Active Listings in Lake Norman increased 5% from last month but were 20% lower than last February. It should be expected that our inventory will continue to rise this spring but hopefully we will remain well below last year’s numbers. Our absorption rate/months of supply of active listings stands at 15. Our shrinking inventory is helping but at this lower pace of sales we are still twice as high as a balanced 6-8 months of supply in Lake Norman area (MLS area 13). The good news for the long-term health of our Lake Norman housing market is that we are not being flooded with new listings so far this year.
- Contingent Sales, (sales contracts that are contingent upon the buyer selling their own home)which don’t account for a significant segment of our housing market, remain extremely low most likely because sellers are unwilling or unable to take on the risk of waiting for the buyer’s home to sell before closing.
- Conditional Sales increased for the third month in a row, this time by 9%. Our Lake Norman housing market has definitely picked up! These are homes that just went under contract and still have financial and inspection conditions. They represent future closed sales most likely in late March/April. Based upon these numbers our closed sales this month and next should exceed the same months in 2011.
- Pending sales were also up 18% compared to February 2011. 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.
- The number of closed home sales in Lake Norman in February were up for the second straight month in a row and a substantial 30% higher than last February. This was the BEST February since 2007! (See the annual chart below).
Lake Norman homes under contract (but not yet closed) on the first of each month are as follows:
- March 1, 2012: 178
- February 1, 2012: 155
- January 1: 134 (the lowest ALL year)
- December 1: 147
- November: 169
- October: 193
- September: 183
- August: 193
- July: 178
- June: 199,
- May: 173
- April 195,
- March: 163
- February: 142
We are now seeing a marked upward trend after a lag at the end of 2011. This uptick in sales coupled with our low inventory bode well for the overall health of the Lake Norman housing market.
Here is a breakdown by price-range of our January 2012 closed sales in Lake Norman’s area 13-1 to 13-5:
- $40,000 – $199,999: 7
- $200,000 – $299,999: 13
- $300,000 – $399,999: 10
(These price ranges represented 52.6% of February sales )
- 400,000 – $499,999: 10
- $500,000 – $599,999: 5
(These price ranges represented 26% compared to 13% last month)
- $600,000 – $699,999: 6
- $700,000 – $799,999: 0
- $800,000 – $899,999: 0
- 900,000 – $999,999: 2
(Solds for $600,000 – $1mill = 14% compared to 23.9% last month)
- $1,000,000 – $1,999,999: 3
- $2 million+ : 1
(Solds $1million+ = 7% compared to 2% last month)
8-Year Comparison of Lake Norman Home Sales By Month
* Please note that all of my numbers are for single family homes. They 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, 2010 and the totals in the prior calendar years. 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.
Summary and My Insight
The Good News and the Bad:
- Inventory remains low without a significant spring bump
- Conditional, Pending and Closed sales are up boding well for the next few months at least!
- Number of distressed homes for sale are actually decreasing as a percentage of our total inventory
- I have experienced multiple offers including one listing of mine that sold for OVER ASKING last week
- We are seeing more and more new construction popping up (Not spec homes)
- Higher-end waterfront lots are selling again. Another sign that construction is returning
- Interest rates are at all time lows
- Unemployment rates are dropping locally and nationally
- Sales above $700,00 are painfully low; our trade-up price ranges and our luxury homes continues to struggle
- With a shrinking inventory of active listings, buyers have fewer options
- Prices remain low
- Home loans, especially construction loans, are still a challenging process.
I continue to believe that our Lake Norman housing market has hit its bottom in terms of sales volume. That said, prices for the most part remain low and buyers continue to be very picky. This is not an easy market for either buyers or sellers.
The future of our Lake Norman real estate market still depends primarily on these two things:
1. How much ”shadow inventory” do we have in our Lake Norman area? Will we see more distressed properties coming on the market later this year or next year? So far this hasn’t been the case.
2. Consumer confidence based upon the national/global economy and relative stability of our national economy
My advice to Lake Norman home buyers remains this: Look for homes that are in good locations and have most of the priorities on your list. While your perfect home might come along, don’t wait too long and don’t dismiss a property if it isn’t perfect. Prioritize: Location, quality and depth of water (if waterfront buyer) and floorplan. Then, to determine a realistic price, use VERY RECENT comparable sales in your specific market niche. The selection may not be great but with interest rates at all time lows and prices low it is a good time to buy. With only 7.4%of Lake Norman’s current listings being “distressed sales” don’t expect the perfect foreclosure or shortsale to come along at an unrealist price. If you insist on lowballing, at least have some comparable sales to justify your number. Don’t focus as much on the price as on the future marketability of the property. A bargain that has incurable issues that will make it difficult to resale, really isn’t a bargain at all. Be smart!
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