Latest news on the Greater Charlotte Region's real estate market in December 2022...
What you need to know...
What it means for you...
December 2022 home sales were down year-over-year for a 12th consecutive month in the 16-County Charlotte Region. Pending sales were also down year-over-year for a 12th consecutive month. Sales are happening, but not at the volume or pace of the prior year or even earlier in 2022.
Despite, lower closed and pending sales, average list and sale prices increased in December 2022, year-over-year. Home prices are still increasing, but at a slower pace. Median sale price also increased year-over-year. The median sale price is the best measure of price over time, as it factors out extreme highs and lows in home prices. Month-over-month, both average and median sale prices decreased.
Higher home prices coupled with higher interest rates have impacted affordability and continued to cool buyer demand in the second half of the year. The market in 2021 was clearly an anomaly and we can now see that year-over-year sales declines over all of 2022 appear significant.
Home buyers are frustrated by higher rates, rising home prices, and economic uncertainty. Consequently, home sales and mortgage applications have fallen since last year as buying "power" declines. Pending sales are a good indicator of future sales and buyer demand. We should expect fewer closed sales in the months to come. Furthermore, the fact that we also see fewer new listings coming on the market indicates Charlotte region will continue to experience inventory challenges, which impact home price appreciation.
HOUSING MARKET OVERVIEW FOR CHARLOTTE REGION:
DECEMBER 2022 VS DECEMBER 2021
CHARLOTTE REGION HOME INVENTORY INCREASED, BUT STILL IN "SELLER TERRITORY"
Housing inventory increased for a seventh consecutive month in December 2022. Inventory is up 54% compared to the same time last year. The months supply of housing is up from 0.8 months to 1.6 months year-over-year. Month-over-month, the months supply of inventory was 0.2 months lower. Month-over-month, inventory decreased by 847 homes. Continued increases in inventory with weaker buyer demand should help cool price appreciation.
Nonetheless, the 1.6 months supply of homes keeps Charlotte region in "seller territory." We need four months of inventory to consider it a "balanced" market. A buyer's market would need six months of supply. And it's worth pointing out that there are parts of the Charlotte Region where the months supply is lower than 1.6 months. Fort Mill, SC, for example, had 1.2 months of inventory in December 2022.
While housing inventory has increased, new listing activity decreased 31.3% in December 2022 compared with December 2021 and is down 10% year-to-date compared with the same time frame one year ago. Month-over-month, Charlotte region saw 932 fewer new listings.
CHARLOTTE REGION HOMES' DAYS ON MARKET INCREASED IN DECEMBER
Averaging 41 days on market, the days on market increased 21 days year-over-year and by seven days month-over-month. Year-to-date days on market were three days higher compared with December 2021.
Pricing a home correctly is increasingly critical for sellers, as the "right" price brings buyers and fewer days on market. The housing market is not what it was last year. Our market is now more like the pre-pandemic market. Home sellers need to adjust their expectations for price and the time it might take to sell their homes.
LIST TO SALE PRICE RATIOS PROVIDED A WINDOW OF OPPORTUNITY FOR CHARLOTTE REGION BUYERS TO NEGOTIATE ON PRICE
With a list to sale price ratio of 94.7% in December 2022 (down 5.5% year-over-year and down 1% month-over-month), buyers are carefully scrutinizing listing prices and negotiating on price. Year-to-date, the list to sale price ratio declined 1.1% to 99.7% in December 2022. Buyers may have more bargaining power now than at any point during the pandemic. By the same token, it's more important than ever that home sellers price their homes realistically.
TODAY'S HOME BUYERS HAVE MORE NEGOTIATING POWER; VIDEO
WINTER 2023 OUTLOOK FOR HOME SALES IN CHARLOTTE REGION
Moving forward into the winter selling season, slowing buyer demand because of economic concerns, increasing interest rates and home price increases reducing affordability are what will hold the market back in terms of sales momentum.
We will continue to see affordability challenges for first-time buyers, as well as challenges for renters to save for a down payment.
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This Charlotte Region housing market update for December 2022 is provided by Nina Hollander and Carolinas Realty Partners with Coldwell Banker Realty, Greater Charlotte residential real estate experts serving Charlotte region home buyers and sellers for 22+ years.
If you're considering selling or purchasing a home in the Greater Charlotte region, I'd love an opportunity to earn your business, to exceed your expectations, and to show you why experience matters and how:
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Read the full article at www.GreatHomesInCharlotte.com
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