Signs of spring in Charlotte are accompanied by continued evidence of a robust Charlotte real estate market.
Strong Selling Prices
For the three-month period ending March 15, Trulia says that the median selling price for Charlotte-area homes was $190,000, a 3.3 percent increase year-over-year. The median selling price of four-bedroom homes was particularly strong, rising 13.0 percent, to $308,000. The one-bedroom home segment also demonstrated strength, rising 9.3 percent to $164,000.
February 2017 statistics released by the Charlotte Regional Realtor Association also reveal strength in Charlotte real estate prices. The association calculated a median selling price of $180,525 in February 2016. One year later, the price rose 10.2 percent to $198,000.
Zillow rates the Charlotte market as “hot,” with home values increasing 7.8 percent over the past 12 months. Using its own metrics, Zillow calculates the current median home value at $179,200. It also projects that median home values will rise another 3.4 percent by January 31 of next year.
Inventory Up Short-Term
February data compiled by the Charlotte Regional Realtor Association highlights growth in key areas. For example, February new listings are up a solid 14.5 percent year-over-year and pending sales are up 18.4 percent. Any increase in available inventory will be welcomed by prospective buyers, many of whom would welcome a wider selection and less competition for desirable properties.
Still, in many instances, Charlotte homes for sale are snapped up in a matter of weeks. In fact, the number of days the average home is on the market has dropped from 71 days to 57 days, a significant year-over year reduction of 19.7 percent. Overall inventory of Charlotte homes for sale is down by more than 2,300 listings since last February, a drop of about 21 percent. There is now only a 2.3 month supply of inventory, down from 3.2 months one year earlier.
Given the imbalance of supply and demand in many parts of the market, it is not surprising that many sellers are getting very close to their asking prices. The percent of original list price received now stands at 96.3 percent, up another 1.3 percent over last February’s already-high 95 percent figure. Going forward, double-digit increases in the number of listings in early 2017 offer buyers hope for the expanded selection they desire. More Charlotte homes for sale could reduce the competition among buyers that has fostered some of the upward pressure on median selling prices.
Impact of Mortgage Rates
Gradual increases in mortgage rates may also slow increases in selling prices. The long run of 30-year benchmark rates remaining in the mid-to-high threes increased the buying power of many of those wishing to purchase. The Fed’s recent rate increase is driving mortgage rates higher. Recent rate increases into the low fours reduce impact on the market by reducing the maximum home value buyers qualify for. With the prospect of additional rate increases by the Feds in 2017, buyers that can do so should act sooner rather than later.