April makes it four; four months in a row of Lake Norman home sales increases over the prior year….but barely! As of today our closed sales are just equal to April 2011’s (See Below!) but I expect at least 3 or more April sales once all of the agents have input their data into our MLS which is the case every month. Unlike the last three months, however, our April closings will not be the highest since 2007. (Update 5/15, they actually equalled our highest April’s!) Of course, in April 2010 we had the tax rebates but we may even match those numbers once all of our sales are recorded. All in all, not a bad month but not great either. That said, wait until you see our other numbers! Here are the April 2012 numbers from our Charlotte Multiple Listing Service for our Lake Norman Area 13 real estate market: IMPORTANT UPDATE! As of today, 5/16/2012 we have now closed 90 sales in April which is 6 higher than this report and 6 higher (7%) than April 2011! Some significant additional interesting statistics for you:
- “Distressed sales” ( Foreclosures (REOS), defaults, Short Sales) comprised only 16.67 % of our closed sales in March down from 27.7 % last month, 21% in February, 31% in January, 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 2011. The US average is 24%. The price range of these distressed sales was $75,000 – $1,270,000. Our percentage of distressed active listings increased slightly to 8% from 6.2 %. Our number of distressed properties remains very low which is very encouraging. We are not being bombarded by foreclosures and shortsales so far in 2012 as some had predicted.
- 40% of our closed sales were waterfront homes which is slightly higher than March’s 31%.
- 43% of Lake Norman’s April home sales were under $400,000.
- 49 % of our April sales were under $500,000 compared to 61% in March sales and 70% in April. Higher price ranges are selling too.
- Our average prices are up for closed and conditional sales and DOWN for our active listings.
- As of today, the number of active listings for all of Lake Norman totaled 950 up from 861 on March 1st but still 20% below April 2011. To put this number in even greater context, back in June of 2008 we had 1789 active listings.
A closer look:
- The number of Active Listings in Lake Norman increased 9% from last month but are 20% lower than last April. 2011 While our number of active listings is increasing as one would expect in preparation for our strongest seasonal sales market they still remain low. Our absorption rate/months of supply of active listings stands at 11.3%. Our shrinking inventory and rising sales are getting us closer to a balanced 6-8 months of supply in Lake Norman area (MLS area 13). This is good news for the long-term health of our Lake Norman housing market.
- 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, have actually been on an upswing. This could be because sellers are more willing to take a risk or more buyers have homes already under contract before they put in an offer.
- Conditional Sales increased for the fourth month in a row, this time by a whopping 79%! This is HUGE! After a slight lull the upward momentum of our Lake Norman housing market is impressive to say the least. These are homes that just went under contract and still have financial and inspection conditions. They represent future closed sales most likely in late May/June. Based upon these numbers our closed sales this month should exceed last month’s and have a chance to be our best May/June /July since 2007. Great short term numbers for Lake Norman!
- Pending sales were up slightly compared to April 2011 and 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.
- The number of closed home sales in Lake Norman in April will be just a bit higher than April 2012 when all the numbers are in but they weren’t too impressive compared to past April’s. (See the annual chart below).
The total number of Lake Norman homes under contract (but not yet closed) on the first of each month are as follows:
- May 7, 2012: 246 (Wow, a new record again!)
- April 1, 2012: 227
- 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 clearly 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 April 2012 closed sales in Lake Norman’s area 13-1 to 13-5:
- $75,000 – $199,999: 11
- $200,000 – $299,999: 12
- $300,000 – $399,999: 13
(These price ranges represented 42.8% of April sales compared to 43% of March sales )
- 400,000 – $499,999: 6
- $500,000 – $599,999: 12
(These price ranges represented 21.4% compared to 26.5% last month)
- $600,000 – $699,999: 11
- $700,000 – $799,999: 3
- $800,000 – $899,999: 2
- 900,000 – $999,999: 4
(Solds for $600,000 – $1mill = 23.8% compared to 19% last month)
- $1,000,000 – $1,999,999: 9
- $2 million+ : 1
(Solds $1million+ = 11.9 % compared to 10.8% 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 Positives and the Negatives: Good signs:
- Sales year to date are up 9.37% over 2011
- Inventory of homes for sale remains low
- Significantly increasing conditional sales indicate that our Lake Norman housing market has strong momentum which will be reflected in higher closed sales for at least the next two months.
- The number of distressed homes for sale are a small percentage of our total inventory and sales
- Sales of homes over $499,000 are improving. This past month the $500,000 – $699,000 price range was particularly strong.
- When properties are priced about right they are getting quite a few showings. I am getting more calls directly from buyers regarding my own listings. There is a marked uptick in the number of buyers out looking.
- We are seeing more and more new construction popping up (Not spec homes)
- Interest rates are at all time lows…3.84% for a 30-year fixed this morning!
- I have a stack of positive articles about the US housing market from: USA Today, Inman News, Real Trends, JP Morgan CEO in CNBC article, National Association of Realtors, Freddie Mac’s Economic Outlook Report, Bank of America and Merrill Lynch forecasts, Zillow.com and Wall Street Daily.
- Positive articles about Charlotte including that we are ranked as one of the 10 fastest growing U.S. Cities according the CNN Money (US Census Bureau), and 53rd in First American’s Improving Market Index
- Donald Trump closed on his purchase of The Point Golf and Tennis Club and is infusing cash into renovations and upgrade now named the Trump National Golf Club, Charlotte.
- Sales prices remain low and I don’t see any signs of them going up. Rather, properties are selling once they are priced low enough to attract offers and then they may even get multiple offers.
- With a shrinking inventory of active listings, buyers have fewer options
- Home loans, especially construction loans, are still a very challenging process.
- New: Homeowner’s Insurance is harder to get due to new stricter guidelines
- Global economic turmoil and US economic uncertainty
As I wrote last month:
I am more convinced than ever that our Lake Norman housing market has hit its bottom in terms of annual sales volume. However, this has not translated to higher sales prices. Prices are low and buyers continue to be very picky; not willing to pay a higher price than past comparable sales. The gossip among Realtors is how dramatically our activity has increased. Despite low inventories, the number of buyers out actively looking has increased substantially. Real estate firms are touting their sales increases and talk as if we are going to sustain these strong numbers. I am a bit more cautious. While the worst is most likely behind us, we have a long way to go and most expect that it will be a very slow recovery. 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 8%of Lake Norman’s current listings being “distressed sales” don’t expect the perfect foreclosure or shortsale to come along at an unrealistic price. If you insist on low-balling, 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!
OTHER ARTICLES of INTEREST