If you are following the national real estate market, you may be getting mixed messages. Some areas are seeing falling prices and there is talk in the news of a “crash” or real estate slow down. Keep reading to learn what is actually happening in the Wilmington, NC market and surrounding areas. Although this data represents New Hanover County, I looked at the numbers for Brunswick, Pender, and Onslow as well. Those markets are similar.
There are several numbers that indicate the current condition of the real estate market. The one I consider to be of great importance, and my favorite to monitor, is months of housing inventory.
Inventory is calculated as follows:
Months of Inventory = # of Active Listings / # of Closings (That month, or an average of several months)
The number of months of inventory indicates the following and gives a picture of current supply and demand:
0-3 Months indicates a seller’s market.
4-6 Months indicates a stable market (usually does not last, gets passed through on the way to either a buyer’s or seller’s market).
Over 6 Months indicates a buyer’s market.
You can see from the graph above that we have not been in a buyer’s market for several years. The closest we were to a stable market was three years ago – before COVID. We have had less than three months of inventory for almost three years.
Now let’s look at September. It looks like things might be changing! Inventory crept up to about the January level (2.4 months), which is the highest we have seen since early summer 2020. Will this continue? No one knows for sure, but my guess is yes. We are at a normal seasonal downturn in the market coupled with roughly a 10 year low in number of homes sold. We may be at a bottom, and I would expect inventory levels to continue to climb through January 2024 until the natural seasonal Spring buying season starts again.
Some other numbers to note: Median days on market remains low at 13 days. Sale to list price remains high at 98.6%, although lower than the past few years when we saw over asking average sale prices. Median sale price remains at a near all time high of $420K. Number of homes sold was at a near low in the past three years of 308 sold in September.
What does this mean to you? Things have slowed down. The people who are buying and selling right now are the people who have to, and investors. Without another personal reason forcing a move, current homeowners with low rate mortgages of the past few years aren’t selling, and buyers are having a hard time finding solutions with current interest rates and home prices that have not yet fallen. So we are still seeing low inventory, and a lot of activity around well priced homes when they do hit the market, because there are people out there who need/want to buy right now.
What does the next year look like? I can’t tell you for sure. My feeling is that prices will level out, buyers will have a chance to breathe without the intense competition of the last few years, and sellers will still be able to sell if they price for the current market. Will home prices drop significantly? I don’t think so, barring another unforeseen catastrophic event. There is still a lot of demand and people continue to move to our area. I believe as interest rates fall, prices will begin climbing again.
If you’re looking to make a move now, there may be some great solutions for you. Selling should be possible at near market highs, and buying at today’s rates is doable for a lot of people, even if not as appealing as it has been the past few years. I do have great lender relationships and programs that allow for 100% financing and refinances within five years if rates drop, without lender origination and appraisal fees. If the time is right for you personally, I wouldn’t wait.
Questions? Please reach out to me at kim@thecoastalrealestategroup.com. I’m actively helping both sellers and buyers win in this market.
Buy
success stories
Sell
