Category: Cotswold

It’s been a bit of a bumpy ride in the Charlotte area over the past few months. Between HB2 and rioting, not all of the dust has settled yet. One place that doesn’t seem to be seeing the dramatic effects yet is the housing market. That may change as we see the numbers for October next month, but for now, we still have a strong seller’s market.

Based on the report from the Charlotte Regional Realtor Association, if you look at the entire Carolina MLS Region, compared to last year, we are doing better in all of the major metrics. New listings, pending sales, and closed sales are all up from last year. Median and average sales price are up. Homes are staying on the market for less time. Inventory is down from last year from 4.2 months to 3 months. A balanced market has 6 months of inventory so this is a substantial shift with the seller having much more power than the buyer in a transaction.

If you look at Mecklenburg County, inventory is down from 4,539 to 3,513 homes. This represents a drop of 22.6%. There has been a rise in the number of homes closed, but not a corresponding rise in new listings. This could be because of fear for the market due to recent events. It could also be that people are moving here and not leaving so we have a lack of housing right now. It could be the time of the year as there is a natural slow-down as we approach the holidays.

Union County follows the same trends except they also have fewer new listings than last year.  Uptown Charlotte is similar to Union County with fewer new listings, but they also have fewer pending listings and have seen a downturn in the Average and Median sales prices. This might be a more direct result of HB2 business losses and riot aftermath.

South Carolina, Fort Mill and Rock Hill are seeing the same trends. Fort Mill closed 30.3% more sales this year than last year at this same time. Rock Hill on the other hand saw a decrease of closed sales from last year of .7% but was similar on all other metrics. Both saw a decrease in inventory to 2.5 months available. This is much lower than the balanced market 6 months.

It will be interesting to see what happens in the next few months. We will be sure to be on top of the data so we can help you better prepare for your future sales and purchases.

Now looks like a great time to upgrade from renting to buying. Zillow predicts a rise in rental rates of 3.2% over the next year in Charlotte. This is well above the nation’s average of 1.7%. With interest rates remaining at historic lows, what have you got to lose?

If you are still on the fence, here are some advantages and disadvantages of buying a home you might want to consider.

Advantages:

1. Greater Privacy. Buying a home, unless it’s a condo or townhome, means you don’t share walls with anyone. This can be great if you want to play loud music, host a dinner, or just have a dance party. This also means fewer restrictions on pets, children, number of cars, etc.
2. Investment. Typically, homes increase in value over time building equity. This can make for a great nest egg for the future, or to help you move up to a bigger home from a starter home. If you pay your mortgage in a timely manner, it can also boost your credit score.
3. Stability of costs. If you have a fixed-rate mortgage, your costs are much more predictable with no hikes in rent. You may still have fluctuations in utilities and taxes.
4. Tax advantages. The mortgage interest and property tax portions of your mortgage are tax deductible. This can mean the difference between owing taxes and getting a refund. Because mortgages are front loaded with interest, you typically have the largest tax write off in the first years you have a mortgage with deductions diminishing each year until you fully pay off the mortgage.
5. Community ties. A mortgage is a long-term commitment, typically 30 years, and can help tie you to your community more tightly than renting. Renters can be more transient as the commitment is typically for 1 year.
6. Personalization. You can paint the walls whatever color you like, heck, you can take out walls or build new ones. When you own, you have much greater freedom to upgrade you home from upgrading, to updating, to changing completely.
7. Second income stream. When you own a home, you have the potential to rent out a room, make your home a vacation rental, or buy a duplex and rent out half. There are many ways to have someone else help pay your mortgage.

Disadvantages:

1. Commitment. It is much harder to sell a home than break a lease. This makes it harder to move to another city.
2. Maintenance. When you own, there is no landlord to take care of a leaky toilet or broken air conditioner.
3. Expense. Typically buying your first home requires a down payment, closing costs and moving expenses. This is usually much higher than security deposit and first month’s rent for a lease agreement.
4. Investment. Any investment carries some risk. Your home may not appreciate much in value, especially in the first few years. It can take 3-5 years in a mortgage to come out ahead compared with renting.

If you think you are ready to take the plunge into homeownership, one of our Realtors would love to work with you.

For the second straight month, the Charlotte Regional Realtor Association report shows that home sales have cooled slightly in the entire MLS reporting area. In June, sales were down over the previous year by 3.3% from 4,577 in 2015 to 4,425 in 2016. In July, sales were down further from 4,286 to 3,900 down by 9%.

Three early months of the year, February, April and May, were up over last year so the YTD numbers are slightly up, 4.4% from 24,105 in 2015 to 25,159 for 2016.

The price homes have been selling for continues to rise from $252,874 in 2015 to $269,426 in 2016. These price increases appear to show that the cool down in the market may be due to price increases. With only a three month inventory on hand, there continues to be a sellers market which is supporting the price increases.

Pending sales have increased over last year by a whopping 20.4% from 3,773 to 4,543. This makes it look like next month should be a better month as most of those pending sales should come to a close. This means that there are still motivated buyers out there that are willing to pay the higher prices for homes.

When you look at the City of Charlotte on the report, you see that there are only 2 months of inventory in the city skewing the market even further in favor of sellers. Prices for homes in the city have gone up almost 5% just this year alone.

A few places defy the trend, Waxhaw, NC saw an increase in home sales from last year of 3.5%. Uptown Charlotte also saw an increase in home sales last month of 25%. Fort Mill and Rock Hill, SC saw home sales about the same as last year, only one additional sale this year over last for each area.

The news is tough if you are a buyer. There isn’t as much inventory as you would like to have the choices available to you. In addition, you will probably have to pay more money for the house you finally get. However, if prices continue to rise, you will be in good shape if you need to sell.

If you are a seller right now, looks like the news continues to be good for you. Your home should sell for more money than it would have last year and you even have the potential for multiple offers with inventory as low as it is right now.

For now, it’s just a wait and see situation to see if the market begins to correct itself. If we get to the point where there is 6 months of inventory, it will be a more balanced market between buyers and sellers. This kind of equity helps buyers and sellers be happier with their transactions.