With two full months of home sales in 2008 now in the books we can truly get a good feel for the actual strengths and weaknesses of the Lake Norman Housing market in the new year.
As you know, every quarter I do a Lake Norman Home Sales Analysis by price-range. In between these I try to provide a snap shot of the current sales and inventory to provide you with a sense of trends in the overall Lake Norman real estate market.
Here are the statistics from January 1, 2008 to February 29, 2008:
|Lake Norman Market Report for Jan/Feb 2008|
|Lake Norman||2008||Average $||DOM||2007||+/-||$||+/-||DOM||+/-|
|Months of Supply||21.8|
*DOM = Days a listing has been on the Market
- Our total home sales for the past two months were down 33% compared to the same period in 2007
- The average price of a home sold in Lake Norman since Jan. 1 dropped 11% compared to the same period in 2007
- The number of days a listing took to sell increased by 30% (This DOES NOT include listings that were re-listed so this number is likely to be much higher)
- The average price of our active listings is $718,069 compared to the average sales price of $414,453. Clearly most home sales right now are in the lower price ranges!
We had 134 homes sales in the first two months of this year compared to 200 in the first two month of 2007. While this in itself is not too serious, the biggest problem we are facing is the large amount of active listings compared to the rate of home sales.
We have a whopping 1460 active listings right now. and more are coming on the market every day in anticpation of our normally robust spring housing market. This means, at our current rate of sales (assuming, to be safe, that home sales numbers do not increase this spring) we have about 21.8 months of supply of homes for sale. In a balanced housing market we should have between 6 to 8 months of supply of homes for sale in Lake Norman.
The Bottom Line:
- We are significantly overstocked in the number of homes for sale in the entire Lake Norman area.
- Our number of home sales, like the rest of the country, are down significantly.
- With supply far outpacing demand, Lake Norman is still in a strong buyers markets. I would anticipate more price reductions this spring, especially in the $400,000+ price ranges.
- I think this spring we will not see our usual, season jump in sales so sellers need to continue to determine their listing prices based upon the very most recent sales of the very best, most similar properties to their own.
- Homes are selling , buyers are buying but expect buyers to be very choosy both about condition and prices as they continue to be concerned about overpaying for a home in this market.
I’ve been through this kind of housing cycle before in the early 1990’s in California. It takes hard work, an excellent grasp of the current market conditions and the ability to identify even the smallest sign of changes and trends. Most of all, it takes patience and the willingness to be flexible and listen to what the market is telling us. While 2008 may not see much change, there is much hope that by 2009 we will be moving forward once again.
Lake Norman and all of its communities are some of the most highly sought after in the country. We will see a return to our strong market as soon as the US economy stabilizes.
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