The Charlotte real estate market has shown very few signs of the typical slow down that is typically experienced this time of year. Normally, the market slows in January and February and then begins to pick back up again in March. There does appear to be some of that happening because pending home sales have dropped substantially from last month. But supply is still low and prices are climbing. Mecklenburg County continues to experience a seller’s market, meaning that sellers have the upper hand. And in December of 2016, the average home price was up 7% over the same month last year.
This week we have published the market stats for December 2016 as compared to the prior month and the same month last year. You can find those stats here: http://wrealtygroup.com/market/stats/ These key market indicators suggest that 2017 should be another strong year for sales. I’ll continue to report that message until we start to see both inventory rise and prices level off.
However, one very interesting point to note is that interest rates as of this month are currently at 4.2% for a 30 year mortgage. That’s the highest we’ve seen since April 2014, almost three years ago. The Federal Reserve recently increased short term interest rates again due to their confidence in the economy and as a measure to curb inflation. If the real estate market continues to maintain its current momentum in the face of rising interest rates, then that is a sign that the Fed has made the right decision. But with both rising prices and rising interest rates, the average house payment will rise even more due to this double whammy.
Of course interest rates are still extremely low historically so we can be thankful for that. But there’s no doubt that the days of cheap real estate in Charlotte are behind us at least for the time being.