Lake Norman’s September 2012 residential real estate sales number makes it NINE months in a row that we have exceeded all prior months’ sales since 2007. While all 9 months of 2012 have been strong, our homes sales in September were not quite as impressive when compared to last September plus they dropped 26.7% from last month’s and were the third lowest month in 2012. After 4 months of triple digit sales it looks like we will remain in double digits for September even after a few more sales are input into our MLS late by agents. We are clearly seeing our typical seasonal slowdown but at this point it still looks like our Lake Norman real estate market is over the hump and moving into sustained positive territory. As always a few more agents will be late in recording their sales so when all the numbers are for September we should have recorded at least 90.
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 September 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 interesting statistics for you:
- “Distressed sales” ( Foreclosures (REOS), defaults, Short Sales) comprised only 19.3 of our totals, up slightly from 14.5% last month. The average price for distressed sales was $390,000 Distressed active listings currently make up only 5.6% of our inventory of Lake Norman homes for sale. Clearly we are not being bombarded by foreclosures and shortsales so far in 2012 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.
- 27% of our closed sales were waterfront homes which was down from 38% last month.
- 53% of Lake Norman’s September home sales were under $400,000 compared to 49% last month.
- 70% of our September home sales were under $500,000 compared to 66% last month, 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.
- Both our closed sales in September and our “Under Contract Show” numbers are up from last September. (See chart above). This serves as further support that Lake Norman’s housing market is on the mend.
- Another very positive sign was that our average days homes were on market before selling were down again in every category but one. Properties are definitely selling more quickly.
- As of today, the number of active listings for all of Lake Norman total 876 down from 917 last month and 12% lower than September 2011. The number of homes for sale in Lake Norman has been lower than 2011 every month this year. Ask any homebuyer 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 5% from last month’s and are 13% lower than September 2011. Our absorption rate/months of supply of active listings stands at 9.9. Our drop in sales this month caused this number to jump up form 7 last month. We are once again above the goal of a balanced 6-8 months of supply in Lake Norman area (MLS area 13) but not nearly as high as the past few years!
- Conditional Sales, which are now called Under Contract Show, increased for the eighth month in a row, this time by 37% 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 October/November. Based upon these numbers our sales in November should be stronger than 2011.
- Pending/Under Contract No Show sales were 9% lower than September 2011’s. These are the contracts that are past inspections and are just waiting to close and are usually the best indication of closed sales in the next few weeks. Given that we had 88 closed sales last October I am a bit concerned as to whether we will able to meet or exceed this relatively high number for a month in 2011. But, overall our late fall numbers are looking pretty strong.
- The number of closed home sales in Lake Norman in September 2012 dropped a whopping 26.7% from last month’s exceptionally strong sales but were a healthy 13% higher than September 2011.
The total number of Lake Norman homes under contract (but not yet closed) on the first of each month are as follows:
- October 8, 2012: 218 ( higher than last month’s and last October’s which indicates a continuation of strong sales through late fall.
- 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 September 2012 closed sales in Lake Norman’s area 13-1 to 13-5:
- $29,007 – $199,999: 10
- $200,000 – $299,999: 21
- $300,000 – $399,999: 16
(These price ranges represented 53.4% of September’s sales.)
- 400,000 – $499,999: 15
- $500,000 – $599,999: 8
(These price ranges represented 26.1% of our sales)
- $600,000 – $699,999: 8
- $700,000 – $799,999: 3
- $800,000 – $899,999: 3
- 900,000 – $999,999: 0 (Compared to 5 last month!)
(Solds for $600,000 – $1mill = 16. % )
- $1,000,000 – $1,499,999: 3
- $1,500,000 – $1,999,999: 0
- $2 million+ : 1
(Solds $1million+ = 4.5%)
The most improved price ranges were the $200,000’s and the $600,000’s.
Higher-end home sales in Lake Norman
Sales in the $700,000- $999,000 range have been extremely slow all over Lake Norman 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. While last month’s closed sales above $1 million were low, there has been a significant spike in activity in the $1.0 – $1.5 million range recently. Of our 218 homes currently under contract, 35 are over $700,000 and 13 are $1 million-$1.5 million .
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
- Lake Norman is experiencing consistently improved closed sales as well as a stabilizing of average prices and lower days on the market.
- Lake Norman home sales year-to-date are up 22.6% over 2011!!!
- Lake Norman’s inventory of homes for sale remains low.
- The number of properties currently under contract indicates that our Lake Norman housing market will sustain our good closed sales numbers for the next several months.
- The number of distressed homes for sale have dropped to 5.6% of our overall inventory…clearly no longer playing a significant role in our housing market.
- 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.
- We are seeing more and more new construction popping up (Not spec homes).
- Interest rates are down to new lows after the Fed’s recent announcement that they will be buying $40 billion a month in mortgage-backed securities. The 30-year fixed conforming home loan rates are at about 3.375% today!
- Because of higher rental prices and low interest rates, it is now better financially for most to buy rather than rent.
- Positive national housing news this month was pervasive. Almost every economist and pundit has now declared that the national housing market is improving and even seeing small price increases: In the Wall Street Journal, “ The housing market overcame a listless economy this summer, and several data points on Wednesday (September 19th) show it is finally beginning a long climb out of a deep hole”. Inman News: “Economists bullish on housing recovery“, CNN Money: “Economists: Housing recovery finally here”.
- Sales prices, while improving, remain historically low
- 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.
The gossip among 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 near all time lows and prices low it is a good time to buy. With less than 6%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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