If you have been following the national real estate business news this past month, these are just some of the comments/headlines you might have read:
“Credit shortage has strangled recovery; households are in bunkers under collapsed net worth, and not coming out until home values are safe.” (Lou Barnes, Inman News)
“The jumbo loan mod ‘pipe dream'” (Bernice Ross Inman News)
‘Mortgage Delinquencies – The Coming Storm….While subprime mortgages sparked the first round of housing problems two years ago, now troubles are lurking further up the food chain…White-collar job losses have accelerated while more adjustable-rate loans to prime borrowers are resetting to higher payments…” (Chief US Economist at MFR Inc. Joshua Shapiro)
“Credit Woes to Threaten Housing Recovery?” (Consumer New and Advice and RISMEDIA)
“Across the country, homebuilders and developers are reporting a deterioration in credit availability and intensifying pressure on borrowers with outstanding loans.” (National Association of Home Builders Chairman Joe Robson)
At the same time the National Association of Realtors report a record 7 straight months of pending home sales increases. It is truly impossible to find any consensus on the future of the US housing market.
However, by taking a look at our local numbers we can have a better understanding the current Lake Norman real estate market and home sales trends and glean potential mini-trends from these.
Lake Norman’s September Housing Statistics
Active Listings continue to decline (3.7%), this is a important part of our Lake Norman housing recovery. Again, note the average price of our active listings when compared to the average price of our solds this past month. Our high-end market is still suffering in part due to the difficulty getting jumbo loans.
- Contingent Sales are up slightly compared to the 14 in August. These are the homes under contract that are contingent upon the buyer’s home selling
- Conditional Sales are also up slightly compared to 54 in August. This confirms that recent activity remains at about the same level as last month
- Pending sales dropped slightly compared to 91 in August. This would further confirm that we might expect October closed sales to be about equal to September.
- The number of closed sales jumped 25% compared to August but dropped about 5% when compared to September 2008. If we stay equal to 2008 winter sales we will experience a significant slow down. The fact that October looks about equal to this past month indicates we might actually have stronger 4th quarter sales than 2008. While this is relatively good news, it is hard to predict past October at this point.
5-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 and the totals in the prior calendar year.
Overall it is my opinion that sales may be a bit stronger in our fourth quarter compared to last year. Granted, we are up against some very weak sales but it does appear we may experience some improvement.
One of the most important trends to watch right now are the prices ranges of Lake Norman homes that are selling. Of the 78 homes that sold last month, only 20 were above $500,000. First-time buyers are taking advantage of the $8,000 rebate and most other Lake Norman home buyers are gobbling up the foreclosures and other bargains that are now available. Some foreclosures are priced as much as 50% of the price they sold in 2005 or their original listing price.
Based upon our September sales we currently have 18.5 months of active listings which is 3 times the 6-month levels of a balanced housing market. We are still clearly in a buyers’ market. It is so hard to predict what will happen if the $8,000 credit is not extended and the “shadow inventory” of potential foreclosures come to fruition.
In the next week or so I will do my 3rd quarter sales analysis by price range to provide greater insight into our Lake Norman real estate market.
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