In the Charlotte, North Carolina market, the average sales price for a single family home has fallen slightly from last month. However, that same metric is up over 7% from last year. Now that’s more like it.
When we look at home prices and trends, we really need to be considering a long term outlook. That’s because real estate is a seasonal asset and prices fluctuate throughout the calendar year. Prices go up in the spring, level off in the summer, and then fall in the, well, fall. They finally bottom out in the winter and the cycle starts over.
The media seems to like taking advantage of this confusion. The summer is about over and it appears that home prices have begun their very slow decline into the fall. Don’t be surprised if you see headlines that say, “Home Prices Are Falling In Charlotte.” Well, yeah…..of course they are. They do every year. The more important thing to remember is that prices are still up substantially from last year.
What’s more, the low supply of housing has not improved with rising interest rates. Demand has definitely softened and we can see that in the trend of fewer sales compared to last year. But the reduced demand has not been enough to compensate for low inventory. In July of this year, the supply of single family homes in Mecklenburg County was 1.2 months. A six month supply is considered a balanced market.
The upward trend of home prices is likely to continue until supply comes back into balance. Unfortunately, buyers who are delaying their home purchase because of high interest rates are likely to end up paying even higher prices in the months and years ahead. Don’t let the headlines of falling prices confuse you. Count on us for the real market info.
This week we’ll be sending out our monthly E-Newsletter with stats for Mecklenburg County single family home sales, comparing July to the previous month and to the same month last year. Here’s a sneak peak:
- Home sales are down 23% from last month and 19% from last year.
- Average sales price is down 2% from last month, but up 7% from last year.
- Median sales price is down 4% from last month, but up 6% from last year.
- Average price per square foot is down 1% from last month, but up 2% from last year.
- The average sale to list price ratio remains at 101% from last month, but down from 102% last year.
- Pending home sales are down 4% from last month and 32% from last year.
- Housing supply is up 8% from last month, but down 15% from last year.
- Mortgage rate of 6.96% is up from 6.81% last month and 5.14% last year.
- Average house payment is down 1% from last month, but up 27% from last year.