We predicted that March was going to be stronger than the prior two months based upon the upswing in Conditional/Active Due Diligence contract numbers in the last month but even I didn’t expect to see the strong sales numbers for Lake Norman this past month! For the first time in 2011 we surpassed our 2010 monthly sales.
A closer look:
- The number of Active Listings remain below last year’s. We are seeing a handful of new listings but not a significant spring bump which is very positive for our overall Lake Norman housing market. Thanks to our relatively strong sales this past month our absorption rate/months of supply of active listings dropped to 14.7 months. While our goal of a truly balanced housing market of 6-8 months of supply is still out of reach we cut in half the high numbers of last month. Clearly we need to have a combination of increased sales and decreased levels of active listings in order to return to a balanced market. Note that the average price of our active listings dropped 13% compared to March 2010. We continue to see a number of price reductions.
- Contingent Sales, (sales contracts that are contingent upon the buyer selling their own home) which don’t account for a signifcant segment of our housing market, have been declining for several months and are now actually 27% below last year’s.
- Conditional Sales and our new “Due Diligence” catagory increased 34% this month when compared to March 2010. These are homes that just went under contract and still have financial and inspection conditions. They represent potential future closed sales most likely in May/June. It is great to see these numbers remain high for the second month in a row. The million dollar question is will this be a sustained rally or just a blip on the screen of our Lake Norman housing market for 2011?
- Our pending sales represented a 22% 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. Our Pending numbers have been down for the past 3 months but should be improving once the Conditional/Due Diligence sales progress. It is important to remember that last year we were anticipating the end of the tax incentives for home buyers so March and April of 2010 had a boost that we don’t have this year yet our March sales were actually better despite this.
- The number of closed sales increased 8% compared to March 2010.
One important note: Our average price for properties sold actually increased this month. Of course, I have pointed out in the past, due to our waterfront properties that can be as high as $11 million, fluctuations in our average prices are expected and don’t necessary have any significance when it comes to what prices are doing in our Lake Norman real estate market.
The total number of Lake Norman single family homes under contract (but not yet closed) on March 31, 2011 jumped to 195. On February 28, 2011 we had 163 compared to January 31st’s 142; December 31st’s 141, to November 30th’s 169, to August’s and July’s numbers of 157, and to June’s 169. Not only was March a strong month but it looks like the next several months may be higher than we have seen in quite some time.
Here is a breakdown by price-range of our March 2011 closed sales in Lake Norman’s area 13- to 13-5:
- $56,000 – $199,999: 13 (Conditional, Cont & Pending =29 )
- $200,000 – $299,999: 16 (Conditional, Cont & Pending = 49)
- $300,000 – $399,999: 14 (Conditional, Cont & Pending = 30)
- (These Solds were 55% compared to 61% last month)
- 400,000 – $499,999: 6 (Conditional, Cont & Pending = 18)
- $500,000 – $599,999: 9 (Conditional, Cont & Pending = 12)
- (Solds were 19% compared to 21% last month)
- $600,000 – $699,999: 5 ( Conditional, Cont & Pending = 15)
- $700,000 – $799,999: 4 ( Conditional, Cont & Pending = 7)
- $800,000 – $899,999: 2 (Conditional, Cont & Pending = 6)
- 900,000 – $999,999: 3 (Conditional, Cont & Pending = 8.)
- (Solds for $600,000 – $1mill = 18% compared to 19% last month)
- $1,000,000 – $1,999,999: 5 (Conditional, Cont & Pending = 17)
- $2 million+ : 1 (Conditional & Pending = 4)
- (Solds $1million+ = 8% compared to 0% last month)
- (Total Conditional, Contingent and Pending =195)
Last month our highest closed sale was $876,000 so clearly our higher end homes languished in early 2011. However, this month our highest sale was $2,000,000. There has been a significant improvement in our higher prices ranges and based upon our Conditional and Pending numbers this trend is still growing.
Also regarding our closed sales, I looked at each property and determined that of the 78 sales in March, 21 were foreclosures, 6 were short sales, 8 were relocation company represented and 1 was an estate sale for a total of 36 or almost half of our entire sales. The hardest hit area was 13-1 (North of Hwy 150 on the east side of the lake) where 8 out of 11 solds were distressed.
Waterfront homes represented 33% of our March Lake Norman sales. The median price was $622,500 and $185 per square foot.
7-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, 2010 and 2011 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.
Above is a snapshot of Lake Norman home sales numbers in the context of the past 7 years. As you can see, our March sales were the highest since 2007!
Things are looking good for April and May but will be beat last year’s numbers? And, more importantly, can our Lake Norman housing market sustain this increased pace?
It is important to point out that our local Lake Norman housing market is not tracking with either Charlotte or the US real estate trends. So, are we experiencing the “double dip” Case-Shiller is reporting in most markets? Clearly, if you look at the chart above, 2009 was our first low in terms of the number of Lake Norman homes sold and we did take a second dip in the number of sales the first quarter of this year. However, the US housing sales bottomed out in 2008, increased in 2009 and then fell back down in 2010.
Unlike our sales volume, I believe that our Lake Norman housing market’s average prices have been trending down consistently since 2007 but have not yet hit bottom so unlike many markets like California who saw an increase in prices last year which are now falling backwards. That said, recent sales have been at rock bottom prices so perhaps we are finally about to hit our price bottom.
OTHER ARTICLES of INTEREST