Stay up to date on the Charlotte NC Housing Market
Charlotte, NC home prices have dropped by 8% since June! The Charlotte housing market is seeing increased inventory, days on market, and price drops! Today, Josh will discuss the Charlotte real estate market, and review the changes we are seeing in real time. Join Josh as he lays out what happened in the Charlotte housing market and what that can mean for buyers and sellers going forward.
Will the interest rates crash the Charlotte, NC housing market? What can we expect for Charlotte moving forward? Josh explains how interest rates and other factors are effecting the Charlotte, NC housing market.
1. Market Overview
2. Number of New Listings
3. Number of Pending Listings
4. Number of Closed Homes
5. Average Sales Price
6. Charlotte NC Housing Market Predictions
Find out how much your house is worth!
1. Market Overview
The Charlotte, NC housing market has seen its share of good news and bad news this year. The Federal Reserve has raised the federal funds rate at the fastest rate since the 1980s. This has desimated buyers purchasing power. In January, the mortgage rates hovered around 3.22%. They have risen to 7%+.
Since June, home prices in Charlotte, NC have fallen by 8%. Inventory in Charlotte has increased due to the economic factors and mortgage rates. Remember the rule of thumb, for ever 1% change in mortgage rates, affects a buyers purchasing power by 10%.
With that being said, we are coming off one of the strongest sellers market’s we have ever seen (We are still in a sellers market)! So, even though inventory has increased and prices have fallen, historically, it’s still a great time to sell.
Find out how much your house is worth!
2. Number of New Listings
In November, 1017 new listings hit the market, which was an 18% decrease from the number of new listings in October 2022. We saw a 23% decrease in the amount of new listings year over year.
We have continuously seen the number of new listings decrease. Now, this can partly be due to seasonal trends (fewer people choose to list their home in the 4th quarter). However, we can see that the year over year trends add to the story. Most homeowners in the United States have a mortgage rate under 5% (many around 2-3.5%) , which could be persuading them to not make a move. If a homeowner wants to move, they would need to purchase a home at a much higher interest rate.
3. Number of Pending Sales
In November 870 homes in Charlotte, NC accepted an offer. This was a 4% decrease from October 2022 & a 36% decrease from the amount of homes that accepted an offer in 2021.
Fewer homes listed = Fewer homes accepting offer’s.
One of the biggest leading indicators for the housing market is the number of new listings compared to number of pending sales. If the number of new listings outpace the number of pending sales, then we can expect the inventory of homes for sale will increase. This means that there will be more homes avaliable and buyers will have more homes to choose from. If the number of new listings continues, then you can expect for the market to eventually transition to a buyers market. The number of new listings have outpaced the number of pending homes since February 2022.
4. Number of Closed Homes
In November 847 homes closed in Charlotte, which was a 20% decrease from October 2022 & a 45% decrease from November 2021.
The number of closed homes is a lagging indicator. Since we have seen fewer newer listings and fewer pending homes, we can expect to see the number of closed homes to be lower.
5. Average Sales Price
The average sales price in November was $487,000, which was a 2% decrease from October 2022. The average home sales price rose 11% since November 2021.
It seems that the average sales price in Charlotte, NC peaked in June. Since June, we have seen the average price fall by 8%.
Even though Charlotte has seen an average home price drop of 8% since June, we still see a VERY healthy year over year appreciation of 11%. Charlotte is also outpacing the United States as a whole. The United States is only seeing a year over year appreciation of 2%, which means we may see this invert to the negative in the coming months.
Even thought the Charlotte, NC housing market has soften, we are still outperforming the United States as a whole. The economic factors + mortgage rates will affect everywhere, however some cities will be affected more than others.
6. Charlotte, NC Housing Market Predictions
Surging mortgage rates have put some much needed pressure on the hot housing market in recent months after home prices hit record highs across the nation.
The overall housing supply remains limited, as those who purchased homes in recent years at extremely low mortgage rates are staying put. This has kept inventory lower than what we could have expected.
We may continue to see a softening market as the Federal Reserve continues to raise interest rates. The Federal reserve’s main goal is to get inflation below 2%. There have recently been a few positive signs that inflation is starting to slow, this could lead to a more ‘dovish’ Federal Reserve.
The Federal Reserve will meet again Dec 13th & Dec 14th. Right now, they are expected to scale back to a 50 basis point hike. Once they get inflation to ‘acceptable’ levels, we may see the Fed hold interest rates at a certain level for most of 2023, extending into 2024.
Strong demand for the Charlotte area will insulate us from experiencing as severe of a downturn as many other areas in the United States. Charlotte, NC is rapidly growing, which is attracting people from across the states and even internationally. There’s an influx of buyers from California, Chicago, New York, New Jersey, and Connecticut.
For home sellers
The market has softened from the peaks we saw in Q1 & Q2, however we are coming off the best time in history to sell a home. You are still seeing double digit year over year price appreciation. Charlotte, NC is still in a sellers market, and will likely remain in a sellers market for some time.
Will you see more competition on the market? yes.
If you are looking to sell, you will need to make sure you have the right marketing strategy and pricing strategy.
For home buyers
Buyers purchasing power has been decimated this year. Housing affordability nationwide is the worst it has ever been on record due to spiking home prices and interest rates, Bloomberg reports.
However, if you are in the market to purchase a home, you will find more avaliable homes to choose from. You may find you can negotiate more on the sales price and other terms. You could ask the seller to pay for your closing costs and/or a home warranty.
Strong strategies for buyers:
1. Ask for the seller to pay for your closing costs, and use the closing cost concession to “buy down” your mortgage rate.
2. If you have a home to sell, you can make an offer contingent on your home selling. Home sale contingencies have been almost impossible over the past few years, however, with the market softening more sellers are open to accepting a home sale contingency.
Is It a right time for you to buy or sell?
It really depends on what you are looking to accomplish, your goals, and your timeline. We would love to connect with you, discuss your real estate goals and help you determine if now is a good time to buy/sell or if it is better to wait. Feel free to call us, text us, or email us. We would love to be your real estate resource of choice!
Contact us through:
📱Call/Text Direct (704)-631-3977
📧Email: info@thefinigangroup.com
