I was previewing Lake Norman waterfront properties last week on a spectacularly beautiful day and decided to take some photos.  This is about as good as it gets for what we call “main channel” views.  At the southern portion, the main channel of Lake Norman widens out quite a bit which creates these vast, wide open water views.  As you travel to the north side of the Brawley Peninsula, the main channel narrows a bit and curves around our many peninsulas making the main channel views quite different; a bit more private.

And yes, that is a real palm tree!

Imagine waking up to this every morning or lounging on a summer afternoon with a cold sweet tea!  Jump in the pool or the lake…so many decisions!

To make your desktop calendar, go to the round button at the top of this site’s home page entitled: “Lake Norman Calendar”. Click on this button and up will come this image of my Lake Norman photo wallpaper calender for January 2012. All you have to do is right click and select “set as background”. If you would like a copy of this photo without the calendar, just send me an email.

FREE $25 GAS CARD!

I need your HELP!  I would love to use one of your favorite photos depicting life here in Lake Norman.  (Optimum size is a landscape photo about 2MB or about 1600 x 1200 pixels). I will give a $25 Gas Card to anyone who provides a photo that I use as one of my monthly calendars.  If you’d like to submit a photo  or an idea for a future calendar, please send it to…

diane@dianeaurit.com

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Lake Norman Monthly Sales Chart for 7 Years

*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!

Price trends since 1998:

As you can see, our volume of Lake Norman home sales peaked in 2005 while our average sales price and price per square foot peaked in 2007.  But, since our significant drop in 2009, our average sales price for all homes in Lake Norman has remained fairly stable while our number of home sales has increased about 16%.

This past year’s average price per square foot of $136 is not that far off of 2005′s $144 despite a drop to half the number of home sales.

Another interesting trend is the average days a home was on the market in Lake Norman (DOM which is the last column on the right).  This number has consistently increased since 2006.

Of course, this is a very broad generalization including so many variables related to waterfront home sales, luxury homes sales etc. but it is important to see our annual trends to get a better overview of our Lake Norman home sales and price trends.

Waterfront home sales trends since 2006:

Waterfront homes have experienced more steady rises and falls in both volume an prices.  After peaking in 2006 in volume, the number of sales plummeted 57% by 2008 and since then have steadily increased by a total of 72%.  At the same time our average sales price and price per square foot peaked in 2007/2008 and have been consistently falling since that time.  Since their peak, the average sales price has dropped 22% and the average price per square foot has dropped 29%.  Finally, the average days on market has increase 3 fold since 2008.

Our waterfront market has such a diversity of types of properties, from luxury estates to single-wide mobile homes and from open main channel water to end of tiny coves that to truly understand your own market you will need to look at the sales by price-range and by age of the property as well.  But, this overview is a good indication of our overall waterfront housing trends.

I would agree that most of the common terms to describe the current national housing market also apply to our Lake Norman real estate market:

• Erratic
• Fits and Starts
• Hopeful
• Comeback
• Cautious
• Rocky Bottom
• A light at the end of the tunnel
• The worst is over
• Price declines are coming to an end
• Home prices won’t hit bottom unitl the end of 2012 or early 2013
• Prices are stabilizing
• Shadow inventory could stall the market’s recovery
• Foreclosures May delay housing rebound to 2013

I will focus on 2012 in my annual forecast in the next few weeks!

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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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If you live on Lake Norman I don’t have to tell you that our lake levels have been uncharacteristically low since late summer; dropping down to 95.0′ on September 17th which is a full 3 feet lower than our  summer “target” levels of 98 feet.  And, you most probably have also noticed a sudden increase starting on November 16th bringing us up to our current level of 98.7 feet! 

I must admit I am baffled as to why Duke Energy, who manages our Lake Norman water levels, decided to drop them fairly suddenly during a time when our “target” levels were 98 feet and we were not in a drought.  One guess is that they were worried about the potential for Hurricane Irene’s high rain levels.  If any of you all know more, please leave a comment!

For those of you who are new to Lake Norman, the very best resource regarding Lake Norman water levels bar none is Duke Energy’s Check Lake Norman Water Levels website  which Duke Energy updates daily.  On this site you can get the actual lake levels of all 11 lakes that are part of the Catawba River System as well as the “target”” Lake Norman water level for that day, the minimum , maximum, range and any lake message updates.  They also provide a schedule of flow releases and other related data.

Lake Norman is a result of the damming of the Catawba River back in 1963 when the Cowans Ford Dam was completed.  It is part of Duke Energy’s power resources and provides electricity to the Piedmont Carolinas by using the McGuire Nuclear Station and the Cowans Ford Hydroelectric Station at the south end of the lake and the Marshall Steam Plant on the west side at Highway 150.  The water levels are controlled by Duke Energy and normally vary less than 5 feet.

The maximum level is called “full pond” which is 760 feet above sea level. Duke Energy considers full pond to be the “the point at which the water begins to spill over the flood gate spillway.” You will sometimes hear waterfront homeowners refer to the “760 line”.

On the Lake Norman Water Level charts, full pond is considered 100.0 feet.  Duke Energy purposely lowers water levels seasonally to anticipate rain or melting of the winter snows that feed the entire Catawba River system.

If you want to see today’s 13-Month Lake Level History chart for Lake Norman  on Duke Energy’s website you can see the daily water levels for the past year.

All I know is the lake looks awesome!

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The Point, with its 13 phases and about 900 home-sites is arguably the most well-known and popular luxury community on all of Lake Norman.  It has been fascinating to watch how the recession initially impacted its home sales and the progress it has made since then. In fact, the numbers today would indicate that The Point is actually leading the Lake Norman real estate market’s recovery.

Back in September of 2008, (see my article: Lake Norman Real Estate:  The Point, A Case Study, Part 2  ) The Point looked like this:

• 123 Active Listings
• A whopping 41-months of supply of homes for sale compared to the overall Lake Norman housing market’s 28-months of supply
• The average days on market for the 9 properties sold was 428 DAYS!

Now fast forward to today and The Point looks like this:

• 38 Active Listings (One third of the amount in 2008)
•  7.86 months of supply of homes compared to over 12-months of supply in all of our Lake Norman housing market
• The average days on market for the 29 properties sold in the past 6 months was 178 days

What a remarkable turn around during a very tough national economic slowdown!  What is so interesting is how The Point went from being significantly worse than our overall Lake Norman market in 2008 to today when it is a bit better off than our overall real estate market.

Here are two charts, one for waterfront homes and one for off-water homes to provide you an overview for the past 10 years.  Keep in mind that 2011 is not completed:

Waterfront Home Sales in The Point 

*Note that the while the number of homes sales this year to date are lower, the average price and $ per square foot are siginificantly higher.

Non-Waterfront Homes Sales in The Point

*Again, while the number of sales is down, the average price and days on market are improving.

This is yet another sign that our Lake Norman real estate market is improving.  Low inventories are key to this trend and they are continuing to fall not just in The Point but throughout our Lake Norman area.

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