What the data tells us:
The real estate market here in the Charlotte region has seen it’s share of ups and downs over the last year thanks to historically high interest rates and unusually low inventory levels. A typical supply and demand curve would tell us the lower the overall supply the higher the demand, but this last year has shown us that real estate economics just isn’t that simple.
As rates climbed above 7% for the first time in two decades buyers were met with the resounding question, do we wait to buy a home? Sellers asked themselves the similar question, does it make sense to sell our home and lose our sub 3% interest rate? The answer is ambiguous and the same for both questions, it depends.
Our inventory levels are historically low right now in the Charlotte region. In fact, they’re the lowest they’ve been in the last 10+ years, but our Months of Market Inventory (MMI) has actually risen to 4 months compared to 2 months just this summer. For those of you that don’t know, 6 months is considered a level inventory for the market. Anything under 6 months and the market is considered to be a sellers’ market because the inventory that is currently available can only sustain the buyers in the market for 4 months. Anything above 6 months and the market is considered to be a buyers market as there is enough MMI to last 6 months or more, meaning buyers have more choices.
What’s interesting about this data is that the number of listings has continued to decline month after month while the months of inventory continues to climb. This explains to us, nearly clear as day, that many buyers have exited the market giving existing buyers more options. This should come as a welcome site to buyers who’ve been waiting in the wings to have more listing options.
Another key factor in the market is our original list price VS sales price data. This data point tells us what the average home was listed for when it first hit the market vs what the average closed price is, regardless of the amount of time it was on the market. In the Waxhaw region specifically, the median original list price in October (so far) is $812,500, but the median sales price thus far is only $610,000. This is explaining that we’re seeing more expensive homes sit on the market longer and lower valued homes are selling faster. It also tells us that sellers are negotiating more off their original list price than in months prior.
Overall, we’re still in a fairly level market locally, but the trends are starting to show that we’re moving towards a buyers’ market. The question, is will buyers actually want to buy when it’s their turn in the market? Only time will tell.
If you want to talk real estate, the market, or options available to you as a buyer you’re welcome to call or email me anytime. 980-250-2795 or Matt@briggsamerican.com. I would love to help you find a way to make homeownership more affordable and a possibility for you!