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Lake Norman Real Estate's August 2009 Sales Analysis

By
Real Estate Broker/Owner with LKN Realty, LLC 242267

 

If you have been following the national real estate news about pending sales being on an upward trend as well as closed home sales in some states, you might have an overall sense that we have hit bottom and are slowly but consistently improving.  But, we need to keep in mind that we always have a seasonal increase in sales monthly from April through July.  Locally our August numbers took a significant dip.  It will be very interesting to see the national housing numbers for August when they are released.

I have been working with a lot of Lake Norman buyers and I can tell you from first hand experience that most sellers in the Lake Norman area are struggling, prices are dropping and there are some really good bargains in every price level.  It truly is a painful market right now and a challenging one for both buyers and sellers due to the difficulties with appraisals and loans and the drop in prices.

 

 Lake Norman's August housing statistics

Lake Norman August 2009 Sales Analysis

  

  • Active Listings continue to decline which is very good news.  Note the average price of our active listings when compared to those that are under contract.

 

  • Contingent Sales  also remain about flat for the past few months.  These are the homes that are sold but they are contingent upon the buyer selling their home...very weak contracts that could go on indefinitely

 

  • Conditional Sales are actually slightly above the 48 in July.

 

  • Pending Sales are equal to July's 90 pending sales which indicates to me that our  September numbers may mirror August's.

 

  • The number of Closed Sales  dropped 18% compared to July 2008.  The average sales price declined 14% and the average days on market increased 30%.  In my opinion, these are critical numbers as they best tell the story of our Lake Norman housing market.  My guess is that our sales peaked last month (July) for 2009 and will now level off.

 

                5-Year Comparison of Lake Norman Home Sales By Month 

  2009 2008 2007 2006 2005
January 27 69 87 102 105
February  40  50 105 98 88
March  55  71 151 153 136
April 65 90 120 143 152
May  66  90 152 182 157
June 87  82 169 227 172
July 90  101 147 166 191
August 62  76 144 180 233
September   69 105 135 163
October   66 98 117 184
November   46 84 88 145
December   62 64 132 134
Totals: 492 901 1489 1704 1873

* Please note that all of my numbers come from the Charlotte Region Multiple Listing Service and will not include sales that took place outside of our MLS.

**I have made an adjustment of  the totals reflecting the ACTUAL sales  every month in 2009 and the totals in the prior calendar year.

 

***IMPORTANT CHANGE IN DATA

While preparing this report I decided to look at the details of the properties that sold in July and August.  I discovered a major flaw in the MLS data program:

  • The normal MLS search for properties that have sold by date actually include the properties based upon when the listing agent entered the sold data into the MLS, NOT when the property actually sold!
  • I went back and discovered that there are a significant number of home sales that are entered several days or more into the next month so the monthly sales numbers are inaccurate.
  • I spoke to the data person at the Charlotte MLS and he said this is the way that the entire MLS reporting is done but that if I want to know the number of ACTUAL sales in any give month I must do a custom search (which I have since done).  So, be forwarned that the public numbers quoted for Charlotte but our MLS will use the flawed method.  I do not know how the national numbers are calculated.

I have since gone back and corrected every month in 2009 to reflect the actual sales that closed in that month.

To give you an example of how bad those prior numbers were, in today's report our August sales would be 79 rather than 62.  There are 22 sales in the August 2009 search that actually closed in July and 5 sales that are included in September when they actually closed in August for a net error of 17! 

 

Summary

 

Clearly our Lake Norman home sales peaked last year in the month of July and I would predict that they also peaked this year in July. August sales dropped 31% versus last month. Right now, with 62 sales and 1498 active listing we have 24 months of inventory of Lake Norman homes compared to a balanced market of 6-8 months of supply.  The average sales price declined 14% compared to August 2008. 

Inventory is coming  down as are prices so the Lake Norman housing market is moving in the right direction to hit bottom.  We must get our inventory down which means getting our prices down to a point where buyers feel confident to buy. 

We are still clearly in a buyers' market.  I think the advantage will be with buyers through the end of the year but then we may see a shift in the mindset of both buyers and sellers as we enter spring 2010.  If the momentum changes, buyers will start to buy fearing they are missing the bottom and they may be right! 

 

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Comments (3)

Tom Braatz Waukesha County Real Estate 262-377-1459
Coldwell Banker - Oconomowoc, WI
Waukesha County Realtor Real Estate agent. SOLD!

Looks like it is time to buy and sell with Diane Aurit in Lake Norman. Happy Labor day to you.

Sep 04, 2009 07:12 AM
Terry & Bonnie Westbrook
Westbrook Realty Broker-Owner - Grand Rapids, MI
Westbrook Realty - Grand Rapids Forest Hills MI Re

Knowing the market is half the battle now accepting the fact that you home isn't worth what you thought it was is difficult.

Sep 04, 2009 02:24 PM
Diane Aurit
LKN Realty, LLC - Mooresville, NC
Lake Norman Real Estate

Tom:  Thank you so much!

Terry:  Yes, it is difficult for both buyer and sellers but knowledge is critical, isn't it?

Sep 05, 2009 09:44 AM