Charlotte-area home sales jumped 33 percent in July from a year ago and buyers continued to pay more – further evidence that sellers hold the upper hand in the local housing market.
The Charlotte Regional Realtor Association, citing preliminary figures, said Wednesday there were 3,527 sales of existing homes in July, up from 2,651 a year ago. It was the largest year-over-year increase in sales since April’s 35 percent gain.
The strengthening market is bolstering sellers’ confidence, encouraging many to finally sell after the housing market crash put them on the fence.
“Homes have been selling at a remarkable rate,” said Sarah Martin, a broker with Charlotte-based Savvy + Co. Real Estate. “We have an agent at the office who has 10 new listings coming up in the next week or two. Eight of those 10 are homes that have been rented for between two and four years because eight of those owners couldn’t sell.”
The average sales price grew by 5.9 percent to $232,851, while inventory continued its downward streak. The amount of homes for sale dropped 18.8 percent, resulting in a 5.2-month supply. A widely accepted definition of a seller’s market is one in which the number of homes for sale is below a six-month supply.
Declining inventory is likely contributing to homes in the region selling faster, as pressure is put on buyers to move quickly. The average number of days a property was on the market from the time it was listed until it closed was 129, down 13 percent. The association’s figures cover 18 counties.
Higher interest rates are prompting some people to hurry up and buy. According to Freddie Mac, the average rate on a 30-year, fixed-rate loan was 4.37 percent in July, up from 3.41 in January but still low by historical standards.
In the Ballantyne area, the announcement of 1,300 MetLife jobs has prompted some homeowners to put their homes up for sale. The sellers see the arrival of the insurance company’s hub in Ballantyne Corporate Park as an opportunity to find a buyer after the downturn made it tough to sell homes.
The improving market is continuing to push buyers to try to outbid one another, real estate brokers say. As recently as a year ago, that was far less common.
Also, sellers are making more money from competing buyers. On average, sellers received 94.7 percent of their original list price, up from 92.5 percent in July 2012, the Realtor association said.
“The thing that’s encouraging to us now ... is good properties, priced right – you get multiple offers,” said Lind Goodman, a broker in Union County for Henderson Properties. “That’s been a long time since we had to even think about multiple offers.”
Goodman said a home she listed in south Charlotte in April received competing bids. The house, originally priced at $360,000, sold in two days for $370,000.
“We had eight showings the first day,” she said. “We could have had three offers that first day. It just so happened that they took the first offer.”
Some sellers are part of the move-up market, and many of those people are opting for new construction, Goodman said.
“The new-home builders have been just swamped,” she said. “They’re selling like crazy.”
Buyers in July saw sellers asking for more money. The average list price increased 8 percent, to $249,984.
It remains to be seen whether the price increases in Charlotte will continue, as some economists expect a slowdown in price gains over the next year to year and a half across the U.S. Also, despite signs of a strengthening market, some Charlotte sellers have had to lower prices this summer after failing to attract buyers.
At least in part, price increases in Charlotte are being attributed to Wall Street-backed investment groups snapping up homes in middle-class neighborhoods across the city to turn them into rentals.
Martin, of Savvy + Co. Real Estate, said some homeowners have been waiting for the market to turn around before putting their houses up for sale. “A strong spring market” and higher selling prices have motivated many to finally take the leap, she said.
“A lot of people that bought at the height are seeing that they can recoup that money,” she said.
The increase in Charlotte home prices is in keeping with a national trend. On Tuesday, Irvine, Calif.-based CoreLogic said U.S. home prices rose 11.9 percent in June, for the 16th month in a row of year-over-year gains. Charlotte home prices rose 7.8 percent, the largest gain for the region in nearly a year and a half.
Roberts: 704-358-5248; Twitter: @DeonERoberts
The Charlotte Observer welcomes your comments on news of the day. The more voices engaged in conversation, the better for us all, but do keep it civil. Please refrain from profanity, obscenity, spam, name-calling or attacking others for their views.
Have a news tip? You can send it to a local news editor; email firstname.lastname@example.org to send us your tip - or - consider joining the Public Insight Network and become a source for The Charlotte Observer.Read moreRead less