The Charlotte North Carolina Housing Market saw surge in activity. What does this mean for the rest of the year? Mortgage rates decreased in March. How will this affect our local Charlotte North Carolina housing market? Join Josh Finigan as he reviews the most up to date information on the Charlotte North Carolina housing market.

If you’re interested in staying “in the know” about the most up to date information on the Charlotte NC housing market than this video/article’s are for you!

Today we will look at the catalysts and trends that are affecting our Charlotte NC housing market, the leading and lagging indicators that can help us identify the current and future state of the housing market. We also discuss what we can expect from the Charlotte housing market in 2023.

 It seems like everyone has their own take on whats going to happen in this housing market.  Everywhere you look, you’ll find headlines preaching fear, uncertainty, and doubt. Our goal is to help you sift through all of the crazy headlines and focus specifically on the greater Charlotte area. Real estate is very local in nature and not all markets will be affected the same.

1. Housing Market Overview

2. Mortgage Rate & Effect On Housing Market

3. Number of New Listings

4. Number of Pending Listings

5. Number of Closed Homes

6. Average Sales Price

1. Market Overview

The Charlotte North Carolina housing market saw some interesting trends in March 2023. According to recent data, home prices increased by 10% and the number of new listings hitting the market increased by 50% compared to the previous month. This surge in activity is indicative of a market that is heating up, which is not surprising given the season and the decline in mortgage rates.

Historically, the housing market tends to pick up in the spring and summer months, as families look to move before the start of the new school year. This is why we often see a spike in home sales and prices during this time. The increase in new inventory also suggests that sellers are feeling confident about the market and are putting their homes up for sale.

Another factor contributing to the current state of the housing market in Charlotte is the decline in mortgage rates. Lower rates mean lower monthly payments, which can make buying a home more affordable for many people. This can lead to increased demand for homes, which can drive up prices even further.

2. Mortgage Rate & Effect On Housing Market

The mortgage rates have proven to be one of the most influential factors affecting our local housing market. We saw that rates declined throughout the month of March. The declining mortgage rates coupled with seasonal trends lead to this marketing heating up! In March, the mortgage rate fell by around .5%. Which means home buyers gained 5% in purchasing power throughout the month of March.  

When you combine declining mortgage rates and a strong seasonal push, you can better understand the surge in activity in our local housing market. But, why did we see mortgage rates fall?

The recent collapse of banks like Silicon Valley Bank and Signature Bank has had a significant impact on the mortgage industry, leading to a fall in mortgage rates. Banks are a major source of funding for mortgage loans, and when banks fail, it can disrupt the flow of capital into the market.

As banks struggle, investors seek out safer assets, such as bonds, which can lead to a drop in mortgage rates. This is because mortgage rates are tied to the rates on 10 year Treasury notes, which are themselves influenced by the demand for bonds.

The collapse of these banks has also led to increased scrutiny of the financial industry, with regulators looking closely at how banks are managing risk and ensuring the stability of the market. This increased oversight can lead to tighter lending standards and more conservative underwriting practices, which can in turn lead to lower mortgage rates.

Overall, the collapse of banks like Silicon Valley Bank and Signature Bank has had a significant impact on the mortgage industry, leading to a fall in mortgage rates. While this may present challenges for banks and investors, it represents a great opportunity for home buyers and home sellers out there.

The Federal Reserve

The Federal Reserve met again on March 21 & 22nd. At this meeting they raised the federal funds rate by 25 basis points, taking the FED prime rate to a targeted range of 4.75% and 5%. This takes the federal funds rate to the highest levels since May 2006. They decided to continue to raise rates, in spite of the recent banking crisis. This shows us how seriously Jerome Powell is taking the inflation crisis. Jerome Powell note’s that inflation is slowing down, which is a good sign. He feels more work needs to be done, so the fight against inflation continues. We may just see a less aggressive fight than before. 

Jerome Powell goes on to say “Inflation remains too high and the labor market continues to be very tight.” He says, “Reducing inflation is likely to require a period of below trends growth and some softening in the labor market.” This means we may not see rate cuts in 2023.

We know that the Federal Reserve’s #1 goal is to bring inflation under the 2% target. While we have a long way to go to get below 2%, we’re moving in the right direction.  

If we look at the Federal Reserve Dot Plot, it shows the Fed’s prime rate peaking at 5.1%. This means we may only have one rate hike left.   

Currently, no officials are predicting rate cuts this year, although they do see rates coming down to 4.3% in 2024. 

What does this mean for mortgage rates?  

We may have seen the highest mortgage rates behind us, however they are unlikely to return to the rock bottom levels we saw in 2020 and 2021. 

We can expect mortgage rates to remain volatile. They will probably yo-yo a bit, at least until there is a firm consensus on when the fed will conclude raising rates. See below for the most recent predictions for mortgage rates to the end of 2023:

3. Number of New Listings

In March, 1,530 new listings hit the market, which was an 50% increase from the number of new listings in February 2023. We can expect to see more people list their homes as we move further into Spring due to seasonal trends of the market. This is a strong sign though, buyers will welcome this increased inventory on the market. However, we saw a 6% decrease in the amount of new listings year over year. This shows us that we’re still below trend for the amount of new listings coming onto the market. However, we are getting closer to year over year norms. The number of new listings coming to the market have continuously decreased throughout 2022 and into 2023 and this surge in new inventory shows us that homeowners are now feeling more comfortable putting their home on the market. 

4. Number of Pending Sales

In March, 1,371 homes in Charlotte NC accepted an offer. This was a 19% increase from February 2023 and a 4% decrease from the amount of homes that accepted an offer in March 2022.  

We can expect the number of pending sales to increase, due to seasonal trends. However, there was a HUGE increase in the number of pending sales from February 2023 to March 2023. One strong reason for this could be the mortgage rates. As we stated before, the mortgage rates fell by around .5% through the month of March, this means that buyers have 5% more in purchasing power. Buyers affordability had a boost, so we saw a boost in the number of pending sales in March 2022. That coupled with strong seasonal trends, lead to a very active month in the Charlotte North Carolina housing market. 

One of the best leading indicators for the housing market is the number of new listings compared to number of pending sales. This helps us determine how to project the inventory levels we can expect in the future.

Sellers Market | Decrease In Inventory

If the number of pending sales continuously outpace the number of new listings, then we can expect the amount of homes for sale will decrease. This means that there will be less homes avaliable and buyers will have less homes to choose from. If this trend continues, then you can expect for the market to eventually transition to a sellers market.

March  2023 New Listings: 1,530 

March 2023 Pending Sales: 1,371

This was the first month in the past 4 months that the number of new listings outpaced the number of pending sales. This indicates that the amount of inventory on the market increased by 12% in March. March was very strong for buyers and sellers alike.  

1. Home Sellers: Home sellers saw a huge increase in the average sales price and buyer demand.  

2. Home Buyers: Home buyers saw a surge in new inventory, giving them more options to choose from. Home buyers also enjoyed falling mortgage rates, making the homes more affordable. 

5. Number of Closed Homes

In March 1,182 homes closed in Charlotte, which was a 37%  increase from February 2023 and a 3% increase from March 2022. 

We have seen the number of closed homes continuously decline throughout 2022. However, we were slightly higher than the year over year trends. Which could be due to a strong 2023 selling season this year. Inventory remains lower, so it will be interesting if this continues. 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. 

6. Average Sales Price

March proved to be a very strong month for home sellers here in Charlotte, North Carolina. In March 2023, the average sales price was $513,000. This was a 10% increase from February 2023 and a 6% increase from the average sales price in March 2022. With March’s data, Charlotte home prices are only 3% off the peak of the market (in June 2022). We’ve seen a 13% increase in home prices since January 2023.

The Charlotte North Carolina average sales price is continuing to chart with the mortgage rates. We’ve seen lower rates, which has spurred more activity in the market and helped home prices appreciate. 

For home sellers

With strong seasonal trends and declining mortgage rates, the market has somewhat revitalized in the recent months. We have likely seen the peak of the mortgage rates, and with this a resurgence in homebuyer demand. Many homeowners have started to take advantage of the lower interest rates and started making a move, which has increased the total inventory on the market. However, this has not affected the demand for homes.  

If you are considering selling your home, make sure you choose the best Realtor. Watch this video to make sure you are asking your potential realtor the RIGHT questions:  10 Questions You Must Ask Your Realtor Before Hiring Them. 

For home buyers

Competiton for the best homes are increasing. However, the lower mortgage rates will help with overall affordability.  Also, more and more homeowners are deciding to put their homes on the market, which will allow more options for you to choose from. 

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. 

Should you buy a home right now?

It really depends on what you are looking to accomplish, your goals, and your timeline. If you are wondering if NOW is the right time to purchase, visit Is NOW a Good Time to Buy a House in Charlotte? We explore who should be purchasing a home and who should wait a little bit. 

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