Charlotte Region Housing Market Update:
The Charlotte region's housing market continued its strong start of the year in March 2016, with pending sales and home prices up and days on market, inventory levels, and new listings all down. Only closed sales were down (1.4%) -- and partially due to lack of affordable homes for sale, as also evidenced by the increased average list price of home to just over $368,000. In a market where the average sale price of a home is some $120,000 lower than average list price, it's easy to see why sales are down due to the extreme lack of inventory in the more affordable price ranges.
March 2016 Closed Sales: down 1.4% versus March 2015 and up 0.3% year-to-date.
March 2016 Pending Sales: up 20.0% versus March 2015 and up 13.9% year-to-date.
March 2016 Average List Price: increased 28.6% to just over $368,000 versus March 2015 and up 7.1% year-to-date.
March 2016 Average Sale Prices: up 2.6% to just under $247,000 versus March 2015. Median Sale Price was also up 3.7% to $198,000 as compared with March 2015. Year-to-date, average and median sale prices are up 4.0% and 4.2% respectively.
March 2016 Percent of Original List Price Received: up 1.0% to 95.5% compared with March 2015 and up 1.2% year-to-date.
March 2016 Inventory of Homes for Sale: down 27.8% versus March 2015, with new listings decreasing by 0.2% in March 2016.
- March 2016 Months Supply of Homes for Sale: down 36.4% to 2.8 months. Charlotte region's housing market continues to be very much a seller's market, as it was throughout 2015, with parts of the Charlotte metro area holding steady at barely 2 months of inventory.
The message for Charlotte region home buyers remains what it was throughout 2015 and isn't likely to change much in the forseeable future:
- The supply of homes available to buy remains very tight and those that are on the market are selling more quickly and with minimal negotiating room. In prime neighborhoods, we see many homes going into contract within days of listing. Home buyers continue to have fewer options to choose from and need to make decisions and offers more quickly than ever. With many homes receiving multiple offers, buyers also need to make "clean" offers with a minimum of contingencies.
- While home prices are not "running away with themselves," they are continuing a steady increase and housing affordability continues to decrease. Buyers must be prepared to pay more for a home and to expect to negotiate less off the asking price. Depending where in the Charlotte metro area buyers are looking, they may not be able to negotiate at all and should expect to see bidding wars that drive the final sale price above asking price.
- For buyers looking for homes priced under $250,000, and especially under $200,000, the selection is exceedingly slim these days.... and no wonder when the average price of homes sold continues to increase month after month.
- With the housing affordability index down by 2.4% in March 2016 alone, and by 3.0% on a year-to-date basis, a strong argument can be made that home buyers should be making purchase decisions sooner rather than later as affordability will most likely continue to decrease.
The message for Charlotte region home sellers also remains what it was throughout 2015 and doesn't appear poised to change much in the coming months:
- If a home is priced right, staged right, and marketed right, it will sell and, on average, should sell in less than three to four months. The days from list to closing in March 2016 were down 5.4% to 122 days as compared with March 2015 and are down 5.4% on a year-to-date basis to 123 days.
- Sellers who have been overly aggressive in pricing their homes are not getting their homes sold. Pricing is still key.
- Sellers need to be prepared to move quickly and to have back-up plans for a new residence at the ready.
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