Yes, you read the post title correctly! The average home price in Mecklenburg County for May 2013 hit an all time high in May. Last month I encouraged my readers to stay tuned as I knew it was coming, but it happened faster than expected. There are still many skeptics out there that say the economy is still struggling. That may or may not be true on a macro or national level. But one thing is for sure, real estate in Charlotte, North Carolina has boomed.
The average sales price for May was $287,955 which is up 17.8% from last year. I have been tracking market stats since 2004. The highest average price that I have seen in any given month was right before the market crash; in September 2008 the average sales price was $278,473. So May’s average price is 3% higher than the pre-recession peak.
A few days ago I shared this news with one of my clients who is a real numbers guy. When I shared the news, he asked me how the average price per square foot has fared. It was a good question because average prices can be deceiving. The average price is just that; it is an average of all sales in that given month. So if more high end buyers happen to be buying in that month, then prices will of course be higher and vice versa if the first time buyer market booms. I appreciated the question very much and have decided to add a few new stats to my blog and E-newsletter including average square footage of homes sold and average price per square foot.
Interestingly, when I did that I was actually surprised to find very little change in the percentages. The average size of home sold has not changed much at all in the past year. Therefore the price per square foot has risen right in step with the average home price. BOTH average sales price and average price per square foot are up about 17% from the same month last year (May). A deep sigh here – the market has come roaring back in a short period of time.
A word of caution! This news that Charlotte prices have hit all time highs is very likely to have a strong impact on home seller confidence. The word on the street is that there is a lack of inventory (which is true). When sellers get wind that home prices are back to peak levels, that will surely be another confidence booster. However, as an agent out the trenches every day, I can report that we are already beginning to see the brakes being gently applied. Showing traffic is beginning to level off along with inventory and pending home sales.
Summer time has always been the seasonal peak of any calendar year. Sales contracts that are coming together this month and next will close at the end of the summer and even into the fall. It is very likely that we will begin to see a downshift when those numbers are reported. In the opening paragraph of this post, I said the market “has boomed”. As much as I would love to see it continue, I’m not sure how much longer the boom will continue. I expect to see numbers rise for another month or two (June & July sales), then begin to slow as they do every calendar year.