March makes it three; three months in a row of increases over prior year and the last two months have been the highest closed single family home sales in Lake Norman since 2007. This is the longest uninterupeted string of month over month sales increases since the 2010 housing rebate program.
It is important to note that these numbers are only as good as the agents who report them. Expect an adjustment in our 83 sales in March upward perhaps two more sales 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 March 2012 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 27.7% of our closed sales in March up from 21% last month, 31% in Janurary, 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. The US average is 24%. The price range of these distressed sales was 120,000 – $1,421,000. Our percentage of distressed active listings dropped to a new low of 6.2 %. Our ratio of distressed new listings to non-distressed has been consistently decreasing. We are not being bombarded by foreclosures and shortsales so far in 2012 as some had predicted.
- 31% of our closed sales were waterfront homes which is almost identical to last month’s.
- 43% of our March Lake Norman home sales were under $400,000 compared to 49% last month & 60.9 % in January.
- 61% of March sales were under $500,000 compared to 70% last month.
- Our average prices are up for closed and active sales.
- On April 1st the number of active listings for all of Lake Norman totaled 861 up slightly from 856 on March 1st. To put this number in context, back in June of 2008 we had 1789 active listings.
A closer look:
- The number of Active Listings in Lake Norman increased less than 1% from last month and were 25% lower than last March. So far our inventory has not increased substantially as one would expect in preparation for our strongest seasonal sales market. Our absorption rate/months of supply of active listings stands at 10.3%. 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 very 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 increased a bit. 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 30%! The upward momentum of our Lake Norman housing market is continuing and even increasing. These are homes that just went under contract and still have financial and inspection conditions. They represent future closed sales most likely in late April/May. Based upon these numbers our closed sales this month and next should exceed the same months in 2011.
- Pending sales were down slightly compared to March 2011 but up 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.
- The number of closed home sales in Lake Norman in March were up for the third straight month in a row. This was the BEST March since 2007! (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:
- April 1, 2012: 227 (Wow, the highest yet!)
- 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 consistent 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 January 2012 closed sales in Lake Norman’s area 13-1 to 13-5:
- $40,000 – $199,999: 11
- $200,000 – $299,999: 15
- $300,000 – $399,999: 10
(These price ranges represented 43% of March sales )
- 400,000 – $499,999: 15
- $500,000 – $599,999: 7
(These price ranges represented 26.5% compared to 26% last month)
- $600,000 – $699,999: 5
- $700,000 – $799,999: 5
- $800,000 – $899,999: 1
- 900,000 – $999,999: 5
(Solds for $600,000 – $1mill = 19% compared to 14% last month)
- $1,000,000 – $1,999,999: 9
- $2 million+ : 0
(Solds $1million+ = 10.8 compared to 7% 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:
- Inventory remains low without a significant spring bump
- 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.
- Number of distressed homes for sale are actually decreasing as a percentage of our total inventory
- Higher-end home sales up to $1.5 million are picking up after dropping off in the winter.
- I have experienced multiple offers including one listing of mine that sold for OVER ASKING last month
- We are seeing more and more new construction popping up (Not spec homes)
- Interest rates are at all time lows
- Unemployment rates are dropping locally and nationally
- Sales prices remain low and I don’t see an signs of them going up. Rather, properties are selling once they are priced low enough to attact offers and then they are likely to get mulitple offers.
- With a shrinking inventory of active listings, buyers have fewer options
- Home loans, especially construction loans, are still a challenging process.
- New: Homeowner’s Insurance is harder to get due to new stricter guidelines
I am more convinced than ever that our Lake Norman housing market has hit its bottom in terms of 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 amoung 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 6.2%of Lake Norman’s current listings being “distressed sales” don’t expect the perfect foreclosure or shortsale to come along at an unrealist price. If you insist on lowballing, 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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