I have a growing stack of real estate news articles both national and regional. After grappling with the question of how best to share this information with you, I decided to put all of the headlines in one article while providing my insight into how they relate to our local Lake Norman Real Estate Market:
THE GOOD NEWS
- North Carolina is the fourth fastest growing state in the nation according to the U.S. Census Bureau. See The Business Journalfor more details.
- According the Zillow Real Estate Market Reports the “Carolinas have year’s healthiest regions“
- The Lake Norman Home Builders Association has joined the National Homes Builders Association’s program: “Fix Housing First” . In essence this national effort is urging for an immediate investment in a stimulus plan by creating a “shrot-term plan, targeted incentive package aimed at qualified buyers.”
- The National Association of Realtors has presented Congress with a Four-Point Housing Stimulus Plan to help stabilize the housing and mortgage markets
- Federal Reserve cut short-term interest rates to nearly zero on December 16th. And, they are “expected to stay at “exceptionally low levels…for some time.”
- Mortgage Interest rates are very low and may go lower. I have seen them as low as 5% in the past few weeks. There are some experts suggesting that they may get down into the mid 4% range if the Federal Reserve moves forward with one plan to infuse money to lenders by purchasing large quantities of debt and mortgage backed securities issued by Fannie May, Freddie Mac and Ginnie Mae.
- The number of active listings in Lake Norman today dropped below 1500 after reaching a high of at least 1789. One of the absolute keys to our local real estate turn around will be lowering the supply of homes on the market. Interesting note: of the 1497 active listing in Lake Norman today, only 379 are new construction. The building of new homes has slowed to a crawl as builders struggle to stay afloat.
- New-home construction activity in the US slowed to a record low in nearly 50 years in November of this year according to the US Department of Housing and Urban Development.
THE BAD NEWS
- According to a recent survey by the Pew Research Center fewer Americans are moving. Since our Lake Norman real estate market is greatly influenced by home buyer relocating here for a better quality of life or a new job, we need people to continue to want to move.
- A new 2-year NC job forecast predicts a “bleak” outlook for jobs with predicted job losses of 96,000 in 2008-2009 according to the lasted UNC Charlotte Economic Forecast.
- Some of the biggest sources of jobs in our local Lake Norman area, NASCAR, Lowe’s Home Improvement, Wachovia and our small retail shops and restaurants are struggling during this economic downturn and are laying off some workers.
- Economists at Freddie Mac are now saying that they expect “total mortgage originations ….to shrink by about 8% in 2009 before rebounding…in 2010″.
- According to the National Association of Realtors, the median price of home sales experienced at “record drop…driven largely by sharp declines in the West”. They were down 4.7% in South.
- “New-home prices slip to “04 level according to the US Department of Housing and Urban Development for the month of October 2008.
- “The crippled Charlotte-area real esate market is feeling a new pain: Sales prices of home-building lots have taken a a double-digit dive.” according to an article in the Charlotte Observer recently.
- In another Charlotte observer article Stella Hopkins recently wrote: “Charlotte’s market began deteriorating about a year later than most but local declines this year have far outpaced the national average in the worst housing market for more than a century.”
- 35 – 40% of all recent home sales across the country were “distress sales” including foreclosures and short-sales according to Lawrence Yun, the National Association of Realtors chief economist.
- Here in the Lake Norman and Mooresville real estate market, sales have dropped to new lows which makes our high inventory of homes listed for sale even more significant. Right now we are sitting on about 34 months of inventory of active listings if sales were to stay at our record low pace. For details see my recent Lake Norman sales analysis and housing market reports.
What does all of this mean to Lake Norman home buyer and sellers and for those planning a move to Lake Norman? Until we get the number of homes for sale down significantly, we are going to be in a buyers market. While we have not seen major overall declines in average sales prices of homes, the law of supply and demand would certainly lead me to believe that prices will come down more. Builders have already been hit hard and are making significant slashes in prices on individual properties and I believe we will see prices come down on resale homes as more and more sellers confront the reality that Lake Norman is being impacted greatly by the national slowdown, especially if things don’t improve significantly in the spring.
There is no doubt that the long-term Lake Norman real estate market will be strong. Our future has a strong foundation of the quality of life and normal economic stability offered in the entire State of North Carolina. I have an exceptionally strong pipeline of well-qualified home buyers from all over the country who are planning to move to Lake Norman. While it may take longer than initially expected, I am confident that most of them will move here. The secret of how wonderful life is in our Lake Norman communities is out. Once inventories fall and consumer confidence returns we will once again enjoy a strong and vibrant housing market!