So, Lake Norman’s real estate market is still rocking! We beat last April’s closed sales by 5% and just about matched last month’s stunning numbers. For the first time our April closed sales actually BEAT April 2007’s and logged in the best April since 2006. Our year-to-date 2015 closed single family home sales were 20.8% higher than 2014’s. On top of these impressive numbers, take a look at what’s on the horizon. Our total number of properties currently under contract match the highest number since the recession which was May 6th of 2013. Lake Norman’s housing market got crazy busy (my technical term for it) right after the holidays and we are now seeing this translated into not just closed sales but high numbers of new contracts as well. Let’s take a closer look:
Lake Norman Market Report April 2015
* All data is from the Carolina Multiple Listing Service.
Some significant additional statistics for you:
- “Distressed sales” (Foreclosures (REO’S), defaults, Short Sales) represented 3.9 % of Lake Norman’s total April home sales. We had just 5 distressed sales with an average price of $221,080 (The highest closed sale price was only $638,000). Distressed active listings currently comprise only 2.1% of our total inventory of Lake Norman homes for sale. Clearly distressed sales continue to play an insignificant role in our Lake Norman real estate market and this is very good news!
- Waterfront homes were 25.6% of our April home sales while they currently comprise 41% of our active listings. The average sales price of a waterfront home in April was $736,264 and the average price per square foot was $225.10 It took on average 197 days for a waterfront home to sell and they sold for 94% of the listing price. Overall, waterfront homes sales still aren’t selling at the rates they were pre-recession. We currently have 11.5 months of supply of active listings so overall our waterfront homes remain in a buyer’s market.
- 25 new construction homes closed in April through our MLS but this does not reflect an accurate picture of new home sales since so many are custom or are purchased directly from the builders and therefore never enter the MLS. (In fact, this segment of the market may be skewing our Lake Norman home sales numbers quite a bit). The average listing price vs sales price of new construction single family homes was 99%. Clearly there isn’t a lot of wiggle room on prices of new homes! We currently have 65 new construction homes under contract in the MLS. The average sales price in April logged in at $452,734. The bulk of our new construction market in the MLS is still in our lower to middle price ranges.
- 52.7% of Lake Norman’s March single family home sales were under $400,000 which was a bit lower than last month’s.
- 72% of Lake Norman home sales in April were under $500,000.
- Our “Under Contract Show” AND “Under Contract No show”/Pending sales combined total of 313 is up substantially from last month’s 272 and last May 6th’s 274. Our new contracts indicate our Lake Norman housing market is very much sustaining if not exceeding our 1st quarter’s momentum.
A closer look at the chart:
- The number of Active Listings today in Lake Norman is 5% lower than last year’s. Our absorption rate/months of supply of active listings is 7.2 which puts us leaning towards a buyer’s market. Within specific price ranges, however, there are swings from buyer’s market to balanced to even a few in a seller’s market.
- Under Contract Show (conditional sales), are up 6% versus this time last year.These are homes that just went under contract (have an accepted offer) and still have financial and inspection conditions. They represent future closed sales most likely in late May/June. This number would indicate that our closed sales should well exceed last May’s. After a bit of a drop off in January, it looks like Lake Norman’s housing market is picking up rather consistently every month despite the lack of a good number of fresh new listings. Note that the days on the market is actually up 5%. My theory on this is that properties that have been sitting on the market are now selling since our inventory of new listing is so low.
- Pending/Under Contract No Show sales are up an impressive 35% and these listings went under contract in only 113 days. These are the contracts that are past their inspection/due diligence periods and are just waiting to close. They are usually the best indication of closed sales in the next few weeks. I think it is safe to say we will at least beat May 2014 sales and may even match or beat our post recession record setting May 2013’s sales.
- Lake Norman’s closed home sales in as of today and as stated above, were up 5% higher than last year’s! (Don’t forget that this number will go up a bit as slower agents log in their sales.)This also makes it the best April since 2006. The average sales price was actually 1% higher than last April’s and the average days on market were up 5%.
The total number of Lake Norman homes under contract (UCS + UCNS) in the first week of each month are as follows:
- May 6, 2015: 313
- April 6, 2015: 272
- March 6, 2015: 228
- February 6, 2015: 204
- January 6, 2015: 154
- December 6, 2014: 204
- November 6, 2014: 221
- October 4, 2014: 275
- September 6, 2014: 272
- August 6, 2014: 261
- July 7, 2014: 268
- June 5, 2014: 262
- May 6, 2014: 274
- April 6, 2014: 243
- March 6, 2014: 187
- February 6, 2014: 185
- January 6, 2014: 155
- December 6, 2013: 197
- November 6, 2013: 207
- October 6, 2013: 207
- September 6, 2013: 218
- August 6, 2013: 264
- July 6, 2013: 271
- June 6, 2013: 293
- May 6, 2013: 316
Here is a breakdown by price-range of our April 2014 closed sales in Lake Norman
- $59,900 – $99,999: 3
- $100,000 – $199,999: 19
- $200,000 – $299,999: 19–
- $300,000 – $399,999 27
(These price ranges represented 52.7% of our April home sales which is down slightly from last month’s.)
- $400,000 – $499,999: 25++
- $500,000 – $599,999: 6
(These price ranges represented 24% which is higher than last month’s )
- $600,000 – $699,999: 11
- $700,000 – $799,999: 5+
- $800,000 – $899,999: 4-
- 900,000 – $999,999: 1-
(These price ranges represented 16.3% which is about equal to last month’s )
- $1,000,000 – $1,499,999: 6
- $1,500,000 – $1,999,999: 1+
- $2 million+ : 2+
(#Solds $1 million+ = 7.0 % compared to last month’s 3.9%)
The stand out price ranges in April in all of Lake Norman were the $400,000’s, $700,000’s and the 3 sales above $1.5 million.
Higher-end home sales in Lake Norman
I hate to be redundant but mercurial and unpredictable still continues to come to mind when trying to describe our luxury housing market. Looking back, August 2014 was such an improvement over the past years’. We even had two sales at or above $3,000,000. In September 2014 our numbers were back down with only 2 sales above $2 million and in October we had a nice increase in the $1,000,000 – $1,999,999 but we only had one sale over $2 million. In November they sank back down fairly dramatically in all price ranges above $700,000. In December we saw a jump in the $1,000,000 – $1,499,999 price range but one two sales above that price. In January we only had 2 sales above $1 million but in February we had 7 sales above $1 million and one over $2 million. In March we had 5 sales over 1 million but none over $1.5 million. This month we had 9 sales over $1 million including 2 over $2 million. HOWEVER, there is quite a bit of activity going on right now and we currently have 29 properties between $700,000 -$995,000 under contract AND 29 $ 1million + under contract!. This is a clear sign that the luxury home-buyers are returning to Lake Norman in 2015.
Lake Norman’s Waterfront Housing Market
Our waterfront housing market is still overall in a buyer’s market. As of today we have 77 waterfront properties under contract which is just equal to last month’s. I have been showing waterfronts in all price ranges and I am noticing quite a bit of activity especially on new listings. With the inventory so low buyers may be realizing that prices will most likely go up once we get in the strong spring and summer months and are therefore more willing to compromise. We currently have 382 waterfront homes actively listed for sale on Lake Norman. With 33 closed sales of waterfront homes in April this means Lake Norman currently has 11.6 months of inventory of waterfront homes for sale so this niche remains overall in a buyer’s market but within certain price ranges it is getting quite heated.
In the meantime, new construction on the water is everywhere. Folks are gobbling up waterfront tear-downs and now even considering older homes that need renovations. If you drive or cycle like I do around the waterfront neighborhoods you will see a lot of new construction on the water. If you are reading this and you are a potential waterfront buyer I would encourage you to take advantage of this low period as it is hard to predict what will come later this spring.
11-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 Carolina 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. ***With our new MLS Matix program there are some variances in numbers but I am not going to go back to prior years and adjust.
I love this chart of our sales by month since 2005 as it really gives us a good sense of where we are today and where we were over the past 11 years. In 2009 we had a total of only 187 sales in the first 4 months compared to this year’s 418. Notice the crazy high sales in 2005! We are actually beat the annual 2007 sales in 2014 so it will be very interesting to watch as 2015 continues after such a strong start. Will we be able to reach last year’s strong 4th quarter numbers?
Summary and My Insight
- Lake Norman’s inventory of active listings remains low although it is getting closer to last year’s numbers as sellers realize this may be the time for them to sell after waiting through the recession. Hopefully our inventory will remain low which will help balance our market.
- The number of distressed homes for sale remain so low that they are truly irrelevant and did not play any perceptible role in our Lake Norman housing market.
- New construction is definitely back. While we only sold 25 new homes last month through the MLS, we have 65 under contract and this does not include custom homes and homes sold directly by the builder/developer in subdivisions. I was talking to a building supervisor for a Lennar Homes community yesterday during a walk though and he said he had 9 closings last month and they are building as fast as they can.
- Waterfront tear-downs and lots are selling. More buyers are willing to build or do major renovations if they can get “good” waterfront lots.
- New listings that are in good condition and in desirable locations are selling quickly.
- Custom and smaller groups of spec homes are popping up all over Lake Norman. Builders are telling me that they could built twice as many as they are if it weren’t for the shortage of qualified labor.
- Economists say that continued housing improvement depends on fundamentals like job growth, rising incomes and low vacancy rates all of which the greater Lake Norman and Charlotte area are experiencing.
- The Lake Norman, Mooresville, Charlotte area is consistently announcing new businesses relocating or starting up in our area.
- Long term mortgage remain lower than early predictions. Jumbo loan interest rates are still LOWER than conforming loan’s.
- I have personally experienced a marked increase in the number of calls from buyers from out-of-state planning to move to Lake Norman since the early January.Because sales and prices are up in many states that feed relocating buyers to our Lake Norman area, more homeowners are able to sell and move now than in the past 5 years.
- Our trade-up price ranges continue to struggle.
- Waterfront home sales continue to be weaker than historical numbers in Lake Norman.
- Lake Norman’s luxury home sales, while better, are still lower than they were before the recession and remain very erratic.
- Lake Norman home prices have stabilized but are only increasing in a rather inconsistent pattern and in different locations and price ranges. At the same time, according to economists, home prices in the entire US are expected to rise about 4.5%.
- Existing home sales are being challenged by new construction! In head to head competitions new construction usually wins which hurts resale homes in the same or similar communities.
- Where are interest rates headed?
- Strict loan standards are still making it more difficult of buyers to qualify despite some easing and modifications.
- Lake Norman’s average days a listing takes to sell, while dropping, is still twice as high as the national average.
- Finding the perfect home has become more difficult because much of the older inventory has been picked over. Buyers who want perfection can’t wait too long to make decisions about new listings because the good homes and lots are selling quickly. Watching the “hot sheet” is once again a part of the buying process. Don’t procrastinate when considering a new listing because they are selling quickly!
- On the flip side, higher-end properties are simply taking much longer to sell.
- No matter how hard I try to provide you with the most accurate and insightful data, it is critical to know your own niche because there are so many variables in the Lake Norman housing market. Don’t assume all price ranges and locations are equal. You might be facing multiple offers and/or picked over inventory or you might not.
My advice to Lake Norman home buyer is to focus on location, neighborhoods and lifestyles that best suit you and/or your family and friends. With bargains gone and sales up now is the time to act quickly when you find a home that suits you. If you are looking in a “HOT” neighborhood and price range be prepared to make an offer or you just might loose out. These are new times so make sure you know what is happening right now in your market niche! 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), lot 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 but rising it is still a great time to buy. With less than 3% of Lake Norman’s current listings being distressed (foreclosures, short sales etc.) don’t expect a “bargain” to come along at an unrealistic price.
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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