With summer right around the corner, in addition to the weather warming, the Charlotte real estate market is also heating up. Home values have increased 7.9 percent over the past year and predictions show this trend will continue. This means would-be homebuyers won’t have much time to simply sit and sip drinks poolside.
Prices and sales up
May’s median sales prices increased to $214,000 from $202,000 in April 2017. Sales also rose to 2,660 units in May from 2,242 in April. This is an 18 percent increase. Per square foot, home pricing is up from $133 to $141 on average. This is higher than the Charlotte Metro area, which averages $120. It is currently a “very hot” market that is great for sellers.
Home prices show no signs of easing. For the first time this spring, the nationwide median home list price rose above $250,000. Here in May, it now stands at $275,000, that’s 10 percent higher than this time last year.
Delinquencies down, foreclosures a concern
There are currently no delinquent mortgages in Charlotte. When a homeowner fails to pay his or her mortgage, it is the first step toward foreclosure. Experts predict that foreclosures will continue to impact home values in the Charlotte area. Currently, 1.5 homes are foreclosed (per 10,000). While it is lower than the national value of 1.6, it is greater than the Charlotte Metro value of 1.3. This time last year, there were more than 2,000 homes in some stage of foreclosure.
Home values peaked in 2007 and are now down by more than 20 percent nationally. Homeowners who owe more than their home is worth are said to be “underwater.” This is true of 0.1 percent of Charlotte homeowners.
Rental market insights
With a decrease in available rentals, it may mean new buyers are entering the market. May numbers show only 2,442 rental units available, a decline in the April number of 2,826 units available. After a slight jump in February from $1,300, median rents in May remained flat in comparison to April and are still at $1,350. While rates are still low, current renters who would be potential first-time buyers may find this is a good time to make a purchase.
All about the rooms
The more rooms within the home, the better the increase in sales. Year over year, one bedrooms in the Charlotte area have increased 2.6 percent, two bedrooms by 7.5 percent and three bedrooms by 9.3 percent. Four bedroom homes saw the biggest increase of 13.2 percent over 2016. In the last three months, prices for four-bedroom houses have increased on average from $310,000 to $360,000.
Current mortgage rate trends
The current mortgage rates in Charlotte are currently at 3.86 percent for a 30-year fixed rate loan. This is a slight decrease from April 1, 2017, when the rate was 4.03. The possibility of increased rates is still there for the second half of 2017. That could dampen the market for buyers.
Yet, as we head into the summer months, Javier Vivas, manager of economic research at realtor.com, notes that this could be a furious start to the season due to a record number of home buyers. According to recent U.S. Census Bureau figures, Charlotte is seeing a large population growth, up 1.9 percent over 2016.