This past two weeks our listings saw an average of less than one showing each. Given the time of year, this is certainly not any cause for concern. The holidays are over and we should slowly begin to see priorities shift back to normal routines. As there really was no normal in 2009, we can start fresh in 2010 as a new normal becomes defined.
The general consensus throughout the media and during casual conversation was that 2009 was a tough year and just about everyone is glad its over. For the Charlotte real estate market that summary is accurate. But if we disect the year as it progressed, there is no doubt that it went from bad to better.
Throughout the holiday season I had the opportunity to socialize with a variety of different people from small business owners to corporate execs and consultants. As discussions of the economy and the real estate market took place, there was a definite pattern that I noticed. Most people agreed that 2009 started out rough, very rough. But by the second half of the year, things really started to turn around. I got a sense that many people were afraid to admit that by the second half of 2009 the worst was over and things were really beginning to improve. It was almost as though people were hedging against a second economic dip. And that’s understandable since the financial downfall was so deep and difficult.
But the reality seems to be that once the “reset” button was pressed between October 2008 and March 2009, real estate and the financial markets have started back on a path more like what we would have expected before the big boom and bust. The majority of people I spoke with felt that 2009 finished strong and far exceeded what most would have expected based on how the year started.
For me, one of the most encouraging examples of the recovery hit me when I was talking with my first new seller clients in 2010. Each time I sit with a new client to talk about listing a home, we evaluate housing inventory in their neighborhood to determine whether they are experiencing a buyer’s market or a seller’s market and to what severity. For two years from 2008 through 2009, I have seen housing inventories in different neighborhoods from 7 or 8 months supply in many first time buyer neighborhoods to almost 5 years for many homes over $1M. The general rule of thumb is that a 6 month supply is a balanced market.
Well, my new client’s (and I) were pleasant surprised to see that in their small neighborhood in Hunstersville, (homes priced from $125-$200K), they were experiencing a 5 month supply based on the last six month’s trend. For the first time in two years, I had the pleasure of informing sellers that their neighborhood was experiencing a seller’s market! It was invigorating and extremely encouraging.
I am very confident that 2010 will continue to be a year of recovery and will finish strong. We have a long way to go before the entire Charlotte real estate market can be classified as balanced. That’s because the high end real estate still has a huge over supply. But if the lower end home sales continue to be strong, then eventually there will be a “trickle up” effect that will begin to lower inventories in the higher price points. I can’t say that the market as a whole will be balanced by the end of 2010, but rest assured….its coming.