Every month, Carolina Multiple Listing Service releases the Charlotte region’s monthly statistics.
Though many articles like to quote month over month or year over year statistics, I believe that it is important to look at today’s statistics versus historical norms because our typical cyclical housing market has been skewed dramatically by government incentives. Below please find Carolina Multiple Listing Statistics from September 2003 through September 2010.
Charlotte’s Activity:
In September 2010, Charlotte’s housing market experienced historically low levels of activity in New Listings (4043), Pending Contracts (1658) and Closed Transactions (1658). These activity levels are well below any September between 2003 and 2009.
What does this mean for you as a Seller?
The decrease in active listings and total listings is positive for our market because there is less competition for the homes that are for sale.
However, low pending sales means that there are were only 1658 people that chose to buy a home last month, as compared to ~3400 buyers each September in the peak years of 2004 and 2005. That’s 50% less buyers in 2010 than the peak years of 2004 and 2005 and 30% less buyers than 2003.
On average, homes are selling at 88% of list price. Listing prices are as high as they were in 2007-08 and closed prices are still down in the 2003-05 range. This significant List to Sales Price disparity is probably due to the increased level of foreclosure and distressed sales in our market. Though there is a current foreclosure moratorium from many banks, The Business Journal reported on October 14th,
“In the 3rd quarter, foreclosures were up 34% year over year in Charlotte.”
On October 15th, a Business Week article stated,
“Homes in the foreclosure process sold at an average 27 percent discount in the first quarter as almost a third of all U.S. transactions involved properties in some stage of mortgage distress, according to RealtyTrac Inc.”
Therefore, if there has been an increase in foreclosures recently and they sell for a significant discount, we are likely to see additional downward pressure on prices in our market.
Though CBJ reported that they “expect to see a dip in repossessions in the 4th quarter” because of the moratorium on foreclosures, there are still a number of distressed sales and short sales available in our market. Ask your Realtor how many distressed homes are on the market in your neighborhood. What homes are buyers in your neighborhood choosing to buy? What comparables will the buyer’s appraiser use to value your property once it sells?
With 50% less buyers in today’s market, the pressure of distressed properties as competition, and the strict lending guidelines, we need to be aware of the intense competition and price and condition all homes accordingly. Please see the blog on Charlotte’s Home Prices – September 2010 to view inventory in each price point and determine the level of competition for your home.
