Every month, I analyze the sale of homes for the preceding month in ten Charlotte local market areas for publication on the Realty Times website and Realtor.com. I have been doing these market analyses since March of 2006. Data is taken from both the Carolina Multiple Listing Service and the Piedmont Multiple Listing Service. These analyses are completed on or about the fifteenth of each succeeding month due to the time allowed by the Carolina MLS for agents to enter sold data.
I was unable to publish the statistics for April, but they were calculated and are contained in the spreadsheet linked at the end of this article. In a nutshell, the local submarkets showed generally increasing unit sales but flat or decreasing average prices in April, still way down from twelve months earlier.
For May, 2009, Charlotte/Mecklenburg County and the larger submarkets increased units following the typical seasonal curve, but continued to be 30% to 40% below 2008 numbers. For Mecklenburg County as a whole, including Charlotte and all other towns in the county, the number of homes sold through the MLS increased from 597 in April to 639 single-family homes, and 146 to 168 condos and town homes. Average selling price was 20% below twelve months ago for single-family, and 11% down for condos and town homes, based on averaged data. Inventory of both single-family and condo/town homes decreased slightly from March/April, to 14 months and 22 months respectively. A normal, healthy market is considered to be 5 to 7 months of inventory, but a decrease is better than a further increase.
I have spent a lot of time trying to understand the few buyers in the market, both for the benefit of my sellers and for my own efforts to find more buyer clients. There are very few buyers in the market compared to almost any time in the past. Most of those buyers, whether first-timers motivated by the tax credit or move-ups realizing that this is a golden opportunity if they have good credit and the necessary down payment, are heavily concentrated in the $100K to $250K price range. There are very few buyers in the medium and high price ranges; inventory of homes over $1M is still four plus years. With virtually no exceptions, these buyers are all looking for the deal of the century, and sellers who must sell have to understand that.
Sellers must position their property as the best value within their competition. Value is a combination of price (low), features and condition, with a small influence from incentives. The formula for selling quickly is to price at the low range of the competition and be the best house from a feature and condition standpoint. Even with that positioning, sellers have to understand that they will have a hard negotiation, will probably have to discount 5% or more from list price, and will have to fix whatever the buyer’s inspections find in order to close the sale.
For buyers - I have said it before but it is still very true - there has never been a better time to buy if you have the credit standing and downpayment money available. FHA loans only require 3.5% up front, and first-time buyers (who have not owned a principal residence in three years) have an especially good opportunity with the 2009 Federal tax credit (10% of purchase price up to $8K).
Click here to download an updated Excel spreadsheet containing all the monthly statistics for these submarkets back to May of 2006.
Rather interesting. Has few times re-read for this purpose to remember. Thanks for interesting article. Waiting for trackback