This week our listings showed on average 1.1 times each. This is clearly a slowdown and is most certainly due to the flurry of recent economic news and the fate of Wachovia, one of Charlotte’s largest employers. Only time will tell how a selloff of the company will affect our local real estate market. Resilience will be critical in the next few years.
Last week the Charlotte Regional Realtors Association released August market data for our region. Specifically, I noted the active listings and closings in our MLS during the month. Back in May, I reported home inventories broken down by price point to show how the market changes as price increases. Five months later, lets compare and see how things are going:
Below is a summary of August’s data for the region
Sold Active Supply % of Market
< 120K 692 5710 8.3 28.0%
120-150K 345 3275 9.5 14.0%
150-190 378 3799 10.1 15.3%
190-250 353 4384 12.4 14.3%
250-350 323 4766 14.8 13.1%
350-500 195 3761 19.3 7.9%
500-1M 155 3309 21.3 6.3%
1M+ 28 1168 41.7 1.1%
The first two columns were taken from the Realtor publication, while I calculated the last two. The supply column represents the number of months it would take for the current inventory in that price range to sell out at the current rate of sales (assuming no new listings hit the market). The last column, % of Market, represents the sales in its respective price range divided by the total number of sales.
Compared to the April 2008 data I reported on my May 31 blog, the market has slowed a bit more, but the slowdown seems to be leveling off. Across the board we see that the Charlotte region is in a strong buyer’s market. A buyer’s market can be defined as one in which supply is greater than six months. But as we look more closely at the data, we see that the degree of buyer’s market increases as price goes up. Notice that for homes in Charlotte over $1 million, it would take over three years for the current inventory of homes to sellout. On the other side, there is only an eight month supply for homes under $120,000.
A market distribution such as the one we are currently experiencing is perplexing for sellers with more expensive real estate. But it is a tremendous opportunity for those trade up buyers. On the selling side, it won’t be nearly as difficult to get your home sold as it will be for the seller of the home you will be purchasing. You might have to take a small haircut on the sale of your home, but it should more than make up for the deal you should expect on the new, larger home.