It is important to note that these numbers are only as good as the agents who report them. Expect an adjustment in our 60 sales in December upward 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 December 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 36,7% of our closed sales in December which was nearly identical to the 36% last month compared to 19.8% in October, 10% in September, 16.8 in August,  18.5%  in July,  25% in June and 27% in May. Our active buyers right now are clearly folks looking for bargains! The good news is that only 10.9 % of our active listings are distressed.
• 33% of our closed sales were waterfront homes up from 19% last month,  28% in October and 38% in September.
• 56.7% of our December sales were under were under $400 and 81.6% were under $600,000. Clearly our lower priced homes are still driving the market.
• On January 1 our active listings for all of Lake Norman were 752, the lowest number since I started these reports in 2007.  To put this number in context, back in June of 2008 we had 1789 active listings.  Today our inventory is a bit higher at 774. We should see an increase of new listings as we do every spring.

A closer look:

• The number of Active Listings in Lake Norman dropped another 14% from last month and 26% from December 2010. Our absorption rate/months of supply of active listings stands at 12.5%.  Our shrinking inventory  is helping but at this lower pace of sales we are still almost twice as high as a balanced 6-8 months of supply in Lake Norman area (MLS area 13).  With only 10.9% of Lake Norman’s current listings being “distressed sales”,  the “shadow inventory” hasn’t impacted our market significantly.  At this pace, our market will remain at a rocky bottom of sorts with a continuation of the erratic ups and downs in 2012.

• 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 actually increased 11% this month when compared to December 2010 but were 12% lower than last month’s. These are homes that just went under contract and still have financial and inspection conditions. They represent future closed sales most likely in late January/February. It looks like our dip in sales will continue well into the new year but not worsen.

• Pending sales were identical to December 2010 and dropped only slightly from last month.    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. While you are reading in the news about the national increase in pending sales here in Lake Norman our pending sales are actually down.  As has been the case, the Lake Norman housing market does not mirror the national markets.

• The number of closed home sales in Lake Norman dropped a substantial 29% compared to December 2010′s and were 20% lower than last month. It is important to remember that we had a particularly strong November and December 2010  and our drop in sales these past two months is actually more in line with our typical seasonal slow down. That said, this December’s closed sales of 60 were the second lowest December since the recession. (See the annual chart below).  Yet another sign that our Lake Norman housing market is continuing its erratic nature.

Lake Norman homes under contract (but not yet closed) on the first of each month are as follows:

• 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

With only 134 properties under contract in all of Lake Norman, we are at the lowest level of sales activity in all of 2011.  We started 2010 with a whimper, then the market picked up, and now we have closed out the year with a whimper as well. Unpredictable? Yes. Yet our low inventory bodes well for the overall health of the Lake Norman housing market.

Here is a breakdown by price-range of our December 2011 closed sales in Lake Norman’s area 13-1 to 13-5:

• $67,000 – $199,999:  16        
• $200,000 – $299,999:  9 
• $300,000 – $399,999: 9

(These price ranges represented 56.7% of  December’s sales )

• 400,000 – $499,999:  8
• $500,000 – $599,999: 2

(These price ranges represented 16.6% compared to 19.4% last month)

• $600,000 – $699,999:  5
• $700,000 – $799,999: 5
• $800,000 – $899,999: 2
• 900,000 – $999,999:  0

(Solds for $600,000 – $1mill = 20% compared to 9.7% last month, 16% in October)

• $1,000,000 – $1,999,999: 4  (The highest sale in November was only $1.375 million)
• $2 million+ : 0

(Solds $1million+ = 6.6% )

7-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 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.

Summary and My Insight

The Good News and the Bad:

Very Good:

• Inventory is way  down
• Number of distressed homes for sale remains at about 10%
• We are finally seeing some new construction popping up (Not spec homes)
• Interest rates are at all time lows
• Unemployment rates are dropping locally and nationally

Bad:

• Monthly sales are still trending down since November.  The erratic nature of our Lake Norman real estate market continues with no end in sight
• 41.7 % of our Lake Norman sales were under $300,000!
• Distressed sales comprise a larger percentage of our sales than our inventory.  Buyers are still looking for bargains!
• Our highest closed sale last month was $1.375 million.  Our luxury home market seems almost non-existent with  only 6 sales over $800,000.
• With a shrinking inventory of active listings, buyers have fewer options.  With fewer “screaming bargains” will buyers sit back a bit this winter or will they buy as they did over the summer? The national news reports about a potential onslaught of  foreclosures may keep buyers from taking advantage of our low prices right now.
• With construction loans nearly impossible to get, lots, especially waterfront, are still sitting

I still believe that, overall, our home prices have stabilized.  I’m not seeing, for instance, the extremely low prices of waterfront home sales with good water that I did two years ago. 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?  I showed a home priced slightly over $1 million this past week that had a notice of default filed in 2008 yet the bank still hasn’t foreclosed.  How many more of these properties are out there?

2.  Consumer confidence based upon the national/global economy.

My advice to Lake Norman home buyers at this point is to look for homes that are in good locations and have most of the priorities on your list.  Then, to determine a realistic price, use VERY RECENT comparable sales.  The selection may not be great but with interest rates at all time lows and prices for the most part having hit bottom it is a good time to buy.  Just make sure you know your market niche!

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It is important to note that I am doing this analysis two days earlier than usual so expect an adjustment in our 72 sales in November upward by the end of the month since it takes some Realtors several weeks to actually input their sales into our MLS.  A great example of this is this past October.  When I did our chart on October 6th we had 81 sales. As of today we actually have 88 sales documented for October in 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 November 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 36% of our closed sales in November which was up significantly from 19.8% last month, 10% in September, 16.8 in August,  18.5%  in July,  25% in June and 27% in May. Our active buyers right now are clearly folks looking for bargains! The good news is that only 9.5% of our active listings are distressed. While the percentage of sales of distressed properties in Lake Norman jumped the number of distressed homes on the market did not.
• 19% of our closed sales were waterfront homes down from 28% last month and 38% two months ago.
• 63% of our November sales  were under $400 and 89% were under $600,000. Clearly our lower priced homes are driving the market right now!
• Today our active listings stand at 859, the lowest number since I started these reports in 2007.  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 dropped another 6% from last month and 20% from November 2010. Our absorption rate/months of supply of active listings stands at 13.5%.  Our shrinking inventory  is helping but at this lower pace of sales we are almost twice as high as a balanced 6-8 months of supply in Lake Norman area (MLS area 13).  With only 9.5% of Lake Norman’s current listings being “distressed sales”, if we don’t get a second wave of foreclosures, which we haven’t so far, our housing market is definitely shoring up but still quite erratic month to month.

• 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 fairly low most likely because sellers are unwilling to take on the risk of waiting for the buyer’s home to sell before closing.

• Conditional Sales decreased 5% this month when compared to November 2010 and were 14% lower than last month’s. These are homes that just went under contract and still have financial and inspection conditions. They represent future closed sales most likely in late December/January. It looks like our dip in sales will continue in December and we will end the year about equal to 2010′s total sales.

• Pending sales dropped to 68 from 79 last month and from a whopping 102 in September.  They are also 14% lower than November 2010.    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. This is another strong indicator that December closed sales will be down from this month’s and December of 2010 as well.

• The number of closed home sales in Lake Norman dropped 11% compared to November 2010′s and were 18% lower than last month. It is important to remember that we had a particularly strong November and December 2010  and our drop in sales this November is actually more in line with our typical seasonal slow down. (See the annual chart below).   My guess is that once all sales are input in our MLS we will probable have about 77 or 78 sales for November which isn’t too far off of November 2010′s 81.

• One important note:  In ever single category on this chart our average prices were down.  We had a marked decline in sales of properties at or above $600,000.  The lowest price ranges in our Lake Norman housing inventory are driving our current market.  It isn’t so much that our prices themselves are still falling but rather the concentration of sales is in our lowest price ranges.

Lake Norman homes under contract (but not yet closed) on the first of each month are as follows:

• December 1: 147 (The lowest since February!)
• November: 169
• October: 193
• September: 183
• August: 193
• July: 178
• June: 199,
• May:  173
• April 195,
• March: 163
• February: 142

With only 147 properties under contract in all of Lake Norman, we are at the second lowest month in all of 2011.  We came in to the year with a wimper then the market picked up and now we will be closing out the year with a wimper as well. Unpredictable? Yes. Yet our low inventory bodes well for the overall health of the Lake Norman housing market.

Here is a breakdown by price-range of our November 2011 closed sales in Lake Norman’s area 13-1 to 13-5:

• $35,000 – $199,999:  19        
• $200,000 – $299,999:  15 
• $300,000 – $399,999: 13

(These price ranges represented 65.3% of November sales compared to 60% of October ‘s total sales)

• 400,000 – $499,999:  7
• $500,000 – $599,999: 7

(These price ranges represented 19.4% compared to 19.6%  last month)

• $600,000 – $699,999:  3
• $700,000 – $799,999: 0  (Wow!)
• $800,000 – $899,999: 0 (Another Wow!)
• 900,000 – $999,999:  4

(Solds for $600,000 – $1mill = 9.7% cimpared to 16% last month and 19% in September)

• $1,000,000 – $1,999,999: 4  (The highest sale in November was only $1.3 million)
• $2 million+ : 0

(Solds $1million+ = 5.5% )

7-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 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.

Summary and My Insight

The Good News and the Bad:

Very Good:

• Inventory is down
• Number of distressed homes for sale is below 10%
• We are finally seeing some new construction popping up (Not spec homes)
• These are all signs that the Lake Norman housing market is stabilizing

Bad:

• Sales are trending down again this month and into January.  The erratic nature of our Lake Norman real estate market continues with no end in sight
• 65.3% of our sales were under $400,000 and 26% were under $200,000!
• Unlike prior months, distressed sales comprise a larger percentage of our sales than our inventory.
• Our highest closed sale last month was $1.3 million.  Our luxury home market was almost non-existent.  No sales in the $700-$899,000 is very rare as well.
• With a shrinking inventory of active listings, buyers have fewer options.  With fewer “screaming bargains” will buyers sit back a bit this winter or will they buy as they did over the summer?
• With construction loans nearly impossible to get, lots, especially waterfront, are still sitting.

I still believe that, overall, our home prices may have hit bottom. 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?  I showed a home priced slightly over $1 million this past week that had a notice of default filed in 2008 yet the bank still hasn’t foreclosed.  How many more of these properties are out there? This is the million dollar question!

2.  Consumer confidence based upon the national/global economy.

My advice to Lake Norman home buyers at this point is to look for homes that are in good locations and have most of the priorities on your list.  Then, to determine a realistic price, use VERY RECENT comparable sales.  The selection may not be great but with interest rates at all time lows and prices for the most part having hit bottom it is a good time to buy.  Just make sure you know your market niche!

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Relocating to Lake Norman

The article went on to say that “Although affordability has increased….housing demand remains depressed with existing home sales back to 1998 levels.”

Of course, I had to see if these is true of our Lake Norman real estate market and here is what I found:

* Note that our 2011 numbers are through today and I expect them to equal 2010.

Insight Summary

• If you look at the Sales column, you can see the dramatic rise, fall and recent leveling out of the number of single family homes sold in Lake Norman (MLS area 13) since 1998.
• The second easiest column to explain is the average Days on Market which shows a fairly consistent time until the past few years.  Imagine that back in the early 2000′s it took less than 2 months to sell a property!
• What is fascinating but a bit more complicated is the average sales prices and the average dollars per square foot columns. Overall our average sales prices in Lake Norman really haven’t dropped that much yet this is counter intuitive to our experiences of the past 4 years.  (Unfortunately I can’t get the median prices from our MLS which is what most national statistics use).  The average sales are particularly skewed here in Lake Norman because of our waterfront homes which can sell as high as $6 million.  It doesn’t take too many very high end sales to impact the average sales numbers dramatically.  As you can see, over all our prices have only dropped about 5% from our highs in 2006/2007.

Through a Statistical Analysis Module I am able to get charts using our MLS data from 2005 to October 2011. I can’t copy them here but I can email you copies if you are interested. Here is what I learned:

• The median sales price in Lake Norman went from a low of $260,000 in January 2005 to a high of $$350,000 in 2007/2008.  Our median prices since then have followed a jagged line between $350,000 down to a low of $315,000 in November of 2009. Lake Norman median prices for home sales have actually increased since September of 2010 and stand at $330,000 as of the end of October.
• In contrast, I looked at the same median sales price chart for ALL of the Charlotte Multiple Listing Service and it resembled a pyramid; starting low in January 2005 and increasing steadily up until the first quarter of 2008 after which it dropped consistently until January of 2010 but not quite as low as the beginning of 2005.  Since then they have remained at about the same price.  Our entire MLS dropped significantly lower than Lake Norman and in a more predictable fashion.

My overall conclusion for these statistics is that Lake Norman truly is a unique market which can’t be discussed with a broad brush approach.  In order to truly understand our Lake Norman housing market if you are buying or selling a home you need to narrow your focus to your specific property type, location and price range.  Hopefully my monthly and quarterly sales analysis will provide more valuable insight for your purposes.  (See the right hand column on the home page of this website where is says “Topics” and click on “Market Reports” to access all of the reports available.

Questions? If you want copies of these charts please email me: diane@dianeaurit.com.

More Lake Norman Real Estate Sales Data:

Lake Norman Real Estate’s October 2011 Sales Analysis

Lake Norman Real Estate’s 3rd Quarter 2011 Price Range Analysis

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