Lake Norman’s December home sales truly put an exclamation point at the end of 2012. For the third month in a row we have posted sales numbers that not only exceeded 2011 numbers but were higher than every year back to and including 2007! And, our first 9 months of 2012 exceeded all months back to 2008.
Let’s take a closer look at the numbers to glean some insight into the short term future and exactly where the Lake Norman housing market stands right now.
Here are the December 2012 numbers from our Charlotte Multiple Listing Service for our Lake Norman Area 13 real estate market:
* Note that the Charlotte Regional Multiple Listing Service has created two new categories, Under Contract Showings (UCS) to continue and Under Contract no showings (UCNS). These replace the Contingent, Conditional and Pending categories. Contingent Sales are now joined with Conditional sales in my reports.
Some significant additional statistics for you:
- “Distressed sales” ( Foreclosures (REOS), defaults, Short Sales) comprised 21.59% of our total sales up slightly from 18.6% last month but significantly down from December 2011 when they represented 34% of our Lake Norman single family home sales. The average price for distressed sales was $467,941 indicating that these sales are primarily in our very lowest price ranges. Distressed active listings currently make up only 7.2% of our inventory of Lake Norman homes for sale. Clearly we are not being bombarded by foreclosures and shortsales as some had predicted. While buyers are looking for bargains they simply don’t exist in the numbers we experienced in the past several years and are now primarily in the lowest price ranges.
- 26% of our closed sales were waterfront homes which was about equal to the past several months. The average sales price of waterfront homes in December was $686,376 or $211 per square foot.
- We had 9 new construction homes sold compared to only 6 in December of 2011. It is important to note that many of the new construction homes you will see driving around the lake are custom homes so will not be included in our Multiple Listing Service numbers. I counted 11 single family homes under construction on Barber Loop on the Brawley School Rd. peninsula alone!
- 61% of Lake Norman’s December home sales were under $400,000 compared to 51% last month.
- 74% of our December home sales were under $500,000 compared to 75% last month, 67% in October, 70% in September, 66% in August, 60% in July, 72 % in June, 70% in May, 49% in April, 61% in March sales. Clearly our lower price ranges are still dominating our Lake Norman housing market.
- Our “Under Contract Show” AND “Under Contract No show”/Pending numbers were up substantially from last December (32% and 49% respectively, see chart above). This serves as further support that our Lake Norman’s housing market is maintaining the strong upswing of sales we enjoyed in the entire year of 2012 and that our late winter sales will remain relatively robust.
- As of today, the number of active listings for all of Lake Norman total 708 down from 790 last month, 834 in October, 876 in September and are 8% lower than the same time last year. However, they are up from the record low of 690 just 5 days ago on January 1. The number of homes for sale in Lake Norman has been lower than 2011 every month this year. Ask any home buyer or Realtor and you will hear complaints about how few homes are on the market. 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 dropped 8% from last month’s and are 8% lower than December 2011’s. Our absorption rate/months of supply of active listings on January 1 was 7.8. This puts us within the goal of a balanced 6-8 months of supply in the Lake Norman area (MLS area 13). Back in January of 2009 we had a 52.5 months of inventory!
- Conditional Sales, which are now called Under Contract Show, increased for the twelfth month in a row, this time by a healthy 32% compared to last year. 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. Based upon these numbers we should start 2013 with relatively strong sales.
- Pending/Under Contract No Show sales were a whopping 49% higher than December 2011’s. These are the contracts that are past inspections and are just waiting to close. They are usually the best indication of closed sales in the next few weeks. Given that we had 88 pending sales last month as well I am pretty confident that we will exceed last January’s 48 closed sales substantially. Not only a great way to enter the new year but a continuation of our remarkably CONSISTENT sales growth after so many years of erratic ups and downs.
- The number of closed home sales in Lake Norman in December 2012 were an impressive 38% above December 2011 and the best December since 2006. Once the few additional belated sales are reported to our MLS I think we will most like have at least 90 sales. While our Lake Norman home sales slowed since the seasonal summer peak they have remained stable since September rather than continuing to drop as they do in most late falls and winters.
The total number of Lake Norman homes under contract (but not yet closed) on the first of each month are as follows:
- January 6, 2013: 184 (While down from last month, 37% higher than last beginning of January’s 2012 numbers)
- December 6, 2012: 197
- November 7, 2012: 214
- October 8, 2012: 218
- September 6, 2012: 206
- August 6, 2012: 228
- July 6, 2012: 234
- June 6, 2012: 235
- May 7, 2012: 246
- 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
Here is a breakdown by price-range of our December 2012 closed sales in Lake Norman’s area 13-1 to 13-5:
- $39,000 – $199,999: 14
- $200,000 – $299,999: 14
- $300,000 – $399,999: 26
(These price ranges represented 61% of December’s sales.)
- 400,000 – $499,999: 11
- $500,000 – $599,999: 6
(These price ranges represented 19% of our sales)
- $600,000 – $699,999: 6
- $700,000 – $799,999: 2
- $800,000 – $899,999: 3
- 900,000 – $999,999: 2
(Solds for $600,000 – $1mill = 14.8% )
- $1,000,000 – $1,499,999: 4
- $1,500,000 – $1,999,999: 0
- $2 million+ : 0
(Solds $1million+ = 4.5%)
The most improved price range was the $300,000 – $399,999. There were no closed sales over $1,725,000.
Higher-end home sales in Lake Norman
Sales in the $700,000- $999,000 range remain slow all over Lake Norman as they have been for most of 2012. In my opinion the good waterfront bargains in the $600,000s peaked two years ago and in the $700,000-$900,000 last summer. Of our 184 homes currently under contract, only 8 are $700,000- $999,000 and 9 are above $1 million. Look for my 4th quarter Lake Norman home sales analysis by price range coming up later this 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 adjust past months when I do the monthly update as a few more sales are usually input late by agents.
Summary and My Insight
- Lake Norman is experiencing consistently improved closed sales as well as evidence that prices have not only stabilized by are actually increasing. Our overall prices in 2012 increased 1.7% over 2011 and climbed to $141.07 per square foot from $136.69 in 2011. While not a large increase, it is still the highest since 2008 and our first average price increase since 2008 as well.
- Lake Norman home sales for 2012 were up 23.2% over 2011!!!
- Lake Norman’s inventory of homes for sale continues to decline to record lows.
- The number of properties currently under contract indicates that our Lake Norman housing market will sustain our strong closed sales numbers for the next several months.
- The number of distressed homes for sale represent only 7.2% of our overall inventory…clearly no longer playing a significant role in our housing market.
- New construction is back! Not only did we sell 9 new homes last month but as I drive and cycle around I am amazed at how many new construction homes are breaking ground.
- Serious home buyers are out looking around all of the Lake Norman area. Properly priced listings in very good condition are selling more quickly and sometimes with multiple offers even in our $1 million+ price ranges.
- Interest rates remain low after ticking up a bit and are predicted to remain low in 2013.
- Because of higher rental prices and low interest rates, it is now better financially for most to buy rather than rent.
- Positive national housing reports and economic analysis continue to headline news about the US housing market both now and predictions for 2013. I will share more in my annual upcoming predictions for Lake Norman’s real estate market in 2013.
- Our mid to higher-end property sales are still inconsistent and relatively weak despite some recent activity.
- With a shrinking inventory of active listings, buyers have fewer options. There aren’t that many “good” homes on the market so buyers are watching the new listings and jumping on most of the good ones if they are priced properly. So, Lake Norman has a lot of “leftovers” on the market that have been reduced a number of times and have more negatives including being dated. are in less desirable locations or not having good water.
- Home loans, especially jumbo and construction loans, are still a very challenging process, particularly underwriting and appraisals.
- Global economic turmoil and US economic uncertainty continue to reign in consumer optimism and the confidence of potential home buyers to a certain degree although not to the extent as last year.
The gossip among Realtors is how dramatically our activity has increased. Despite low inventories, there are a good number of buyers out actively looking to buy a home in the Lake Norman area which should continue to grow as we hit our seasonally strongest months in spring and summer. I am not 100% convinced that our Lake Norman real estate market will maintain an uninterrupted trend in growth but I am more bullish than I have been in 5 years. While the worst seems more than ever to be 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 floor plan. 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 near all time lows and prices low it is a good time to buy. With less than 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!
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