People are constantly asking me “how’s the market?” Although, I’m very interested in the overall economy both locally and globally, including what’s happening with wall street, gas prices, etc., I’m really only qualified to answer as it relates to the Charlotte real estate market. As a practicing Realtor in the trenches every day, my response is that the market is very strong. From my perspective, all indicators for the Charlotte real estate market are up and pending homes sales (an indicator of what’s to come in the coming month’s) is also predicting that sales will continue to be strong.
Today I will be sending out my monthly E-newsletter which includes the market stats for Mecklenburg County in July. Check it out and be sure to consider the changes over the same period last year. There’s no doubt that things have improved. A few things that are notable in this month’s data:
– There were 992 single family home sales in Mecklenburg County in July. That number is up 21% over the same period last year. But it’s also important to recognize that the last time sales were that high was June 2010 when sales peaked due to homebuyer tax credits. Prior to that, the last time we saw sales that high was back in May 2008, which was just about the time when sales prices were peaking in Charlotte. In May 2008, Charlotte didn’t see the downturn coming yet and sales were still considered strong. So in terms of sales, we have recovered from a sales standpoint. (For reference, the highest number of home sales I’ve tracked since 2003 was in August 2005 when that number hit 1652).
– Pending home sales are currently sitting at around 2400 contracts and has been since February. In Spring of 2010, pending sales hit 2000 for a few months because of the tax credits but then fell sharply immediately after the tax credits expired. The last time we saw pending sales numbers similar to what we’ve had this year was back in the summer of 2007. The peak for pending sales was in the spring of 2007 when they hit 3000. The pending numbers we are seeing right now are only about 600 contracts short of the peak for that indicator. Pendings have been rising until this past month as they appear to be leveling off. I expect them to begin dipping again due to seasonality.
– Home prices appear to have hit a peak for 2012 as of June. Both the average and median prices have dipped slightly from the previous month, but are both still up from last year. Seasonally, that is normal. During a calendar year, it is normal for prices to peak in the summer and then fall back as the year comes to an end. The hope is that they only fall slightly and then pick up steam again in the spring of 2013.
– Inventory has fallen to 8.8 months. A balanced market is at six month’s supply. Anything over that is a buyer’s market and under is a seller’s market. So we are still in a buyer’s market. But, things are getting closer to balance every month. The last time supply was this low was pre-recession in spring of 2008. Supply hit a low of 4.6 months in December 2005, rose a bit, then dropped to 4.7 again in December 2006. From there supply steadily rose to a peak of 13.9 in March of 2010. We have come a LONG way since then.
If I were living in a vacuum and real estate were all I knew, I would be as bullish as one could be on real estate. (I am very bullish, but still have the same fears as many others). Of course, I don’t live in a vacuum and I hear the same gloom and doom that everyone else is hearing about the global economy, high unemployment, etc. I think we are all afraid of repeating the last 3-4 miserable years of recession and don’t ever want to go back there again. Clearly, a downturn in the national or global situation will have an impact on our local real estate market. But I’m staying bullish until the numbers can prove me wrong. Charlotte real estate is selling like hot cakes right now. It’s a great time to sell and there’s still terrific opportunity for buyers, especially with interest rates below 4%. When will a time like this ever come again!