This past month serves as yet another example of just how erratic our Lake Norman real estate market has been this year. After an abysmal May, our June closed sales shot up exceeding even my own predictions based upon last month’s pending home sales! Considering that last June was the end of the rebate program, this June was quite impressive; an improvement over 2008 and 2009 for only the second month this year (March).
Here are the June numbers from our Charlotte Multiple Listing Service for our Lake Norman area real estate market:
Some interesting statistics for you:
- 24 of the 95 closed sales or 25% were either Foreclosures (REOS) or Short Sales compared to 27% last month.
- The number of Short Sales was almost equal to Foreclosures which supports the national trend of lenders focusing on working with distressed sellers rather than going through the foreclosure process.
A closer look:
- The number of Active Listings in Lake Norman remains well below last year’s. Our absorption rate/months of supply of active listings dropped to our lowest number since the recession: 12.6 months! ( May had jumped back up to 20 months due to the drop in closed sales. In April we had 14.5 months). Unfortunately, a goal of a truly balanced housing market of 6-8 months of supply is still out of reach in our Lake Norman area (MLS area 13). If we can sustain this high number of sales then I think we can say with confidence that the Lake Norman real estate market has turned the corner at last. However, it is more likely that we will see the erratic ups and downs for sales in Lake Norman though the end of 2011. Note that the average price of our active listings dropped 8% compared to June 2010. We continue to see a number of price reductions.
- Contingent Sales, (sales contracts that are contingent upon the buyer selling their own home) which don’t account for a signifcant segment of our housing market, have been declining for several months and are now actually 42% below last year’s. If you look at the average Days on Market you can see why sellers are not accepting contingent offers!
- The combined total of Conditional Sales and our new “Due Diligence” category increased 23% this month when compared to June 2010. These are homes that just went under contract and still have financial and inspection conditions. They represent potential future closed sales most likely in late July/August/September. After dropping in March and April and then increasing in May by 30% these numbers indicate that we will likely see some higher numbers for closed Lake Norman home sales in the next several months. It is important to note that I decided to separate Conditional from Active Due Diligence catagories because it has become increasing difficult to provide good insight into the average prices and days on market.
- Unfortunately, our Lake Norman Pending sales represent a 23% decrease from a year ago. 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. As I anticipated last month, we saw a nice increase in sales in June when compared to May but I think that we will again see sales slip slightly in July and August.
- The number of closed home sales in Lake Norman were only 12% below June of 2010 after a 34% drop in May. This is particularly encouraging when you consider that last June 2010 was the end of the home buyers rebate/tax credit program. One important note: The average price of homes sold were 12% lower than June 2010 after jumping 26% last month. Another example of the erratic nature of our current Lake Norman real estate market!
The total number of Lake Norman single family homes under contract (but not yet closed) on June 30th is 178. May 31st increased to 199 after falling in April to 173. On March 31, 2011 we had 195 compared to February 28th’s 163 and January 31st’s 142. Last June we had 169 which is another indication that the next two months may result in similar closed sales as in the same months of 2010.
Here is a breakdown by price-range of our June 2011 closed sales in Lake Norman’s area 13- to 13-5:
- $13,000 – $199,999: 20
- $200,000 – $299,999: 14
- $300,000 – $399,999: 13
(These price ranges represented 49.5% of June ‘s total sales compared to May’s 54%)
- 400,000 – $499,999: 16
- $500,000 – $599,999: 6
(These price ranges represented 23.2% compared to 17% last month)
- $600,000 – $699,999: 7
- $700,000 – $799,999: 3
- $800,000 – $899,999: 3
- 900,000 – $999,999: 1
(Solds for $600,000 – $1mill = 14.7% which is almost identical to last month’s 15%)
- $1,000,000 – $1,999,999: 10
- $2 million+ : 2
(Solds $1million+ = 12.6% compared to 13.6% of May’s total sales)
7-Year Comparison of Lake Norman Home Sales By Month
* Please note that all of my numbers 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.
Above is a snapshot of Lake Norman home sales numbers by month for the past 7 years. As you can see, our June home sales were the highest to date in 2011. I just added the 6-month subtotals to the chart which show that so far in 2011 we are 9.4% below the first half of 2010 and better only than our bottom in 2009. This substantiates the concept of a “double dip” housing market as seen in most of the nation.
Up until now I have felt that our Lake Norman housing prices have been consistently trending downward. We did not see increases in home sales prices after the first dip in 2009 as did much of the country. However, I think we are now evoling into a market where Lake Norman home prices, especially of waterfront properties, are erratic but I am not seeing the “screaming bargains” that we saw in the past few years. For the first time I personally feel that overall our home prices may infact have hit bottom. The ability to find more “screaming bargains” will depend on how many more distressed homes come on the market. They will exisit, but not as frequently and not on homes in good condition with good water. My advice to Lake Norman home buyers at this point is to look for bargains but if you find a good home that is reasonably priced you might want to move on it rather than wait to see if it comes down further. Always have your Realtor do a comparative market analysis so that you can determine the price of your offer based up very recent comparable sales.
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