Hot of the press, of course, is the big news that President Obama signed into law yesterday the newly revised and extended Homebuyer Tax Credit!  Not only does this legislation extend the $8,000 first-time home buyer tax credit to April 30, 2010, it also adds an exciting new provision.  As of yesterday and through April 30, 2010, homeowners who have lived in their primary residence for 5 consecutive years out of the previous 8 years will be eligible for a tax credit of up to $6500 if they sell this home and have a new written purchase contract by April 30, 2010 and closing no later than July 1, 2010. This is expected to be a big boost to home sales throughout the country.

Other good news came from the Federal Reserve this week.  They will keep the target rate for federal funds at zero to .25% and “continues to expect that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period”.

At the same time the National Association of Realtors report a record 8 straight months of pending home sales increases. 

However, on the negative news side, there has been much discussion about the “shadow” inventory expected to come on the market next spring and a second round of foreclosures brought on by Option ARMS and Alt-A loans that are resetting over the next 18 months.  Some are saying that this second wave of foreclosures, which for the most part are not subprime, will hit the mid-range and luxury home markets because these are loans that the middle class Americans got during the 2004-2007 time-frame.  And, getting new home loans, especially jumbo, are still extremely challenging and a tedious process at best.

It is truly impossible to find any consensus on the future of the US housing market.

However, by taking a look at our local numbers we can have a better understanding the current Lake Norman real estate market and home sales trends and glean potential mini-trends from these.  Below are our October real estate numbers for Lake Norman: 

Lake Norman’s October 2009 Housing Statistics

• Active Listings continue to decline (4.0%).  As I have written many times, this is an important part of our Lake Norman housing recovery.  Again, note the average price of our active listings when compared to the average price of our solds this past month. Our high-end market is still suffering however I am seeing some increased activity in part due to foreclosures and short sales.

• Contingent Sales are down slightly compared to the 17 in September.  These are the homes under contract that are contingent upon the buyer’s home selling

• Conditional Sales are up slightly compared to 58  in September.  This confirms that recent activity remains at about the same level as last month

• Pending sales dropped slightly compared to 87  in September.  This would further confirm that we might expect November closed sales to be about equal to October and September which would actually be a significant improvement over November 2008.

• The number of closed sales was identical to last month and a whopping 22% higher than October 2008!   I am now feeling pretty confident that our fourth quarter 2009 sales will be significantly stronger than last years record lows.  While this is relatively good news, it is hard to predict past November at this point.

 5-Year Comparison of Lake Norman Home Sales By Month 

* Please note that all of my numbers come from the Charlotte Region Multiple Listing Service and will not include sales that took place outside of our MLS.

**I have made an adjustment of  the totals reflecting the ACTUAL  sales  every month in 2009 and the totals in the prior calendar year.

Summary

Overall it is my opinion that sales will definitely be stronger in our fourth quarter compared to last year.  Granted, we are up against some very weak sales but I like the trend!  Some of my buyers have jumped off the fence to take advantage of some incredible deals in all price ranges.

Based upon our October sales we currently have 17.7 months of active listings which is 3 times the 6-month levels of a balanced housing market however we are seeing this number improve slightly each month.  Yes, Lake Norman is clearly in a buyers’ market and probably will be for some time to come but we are heading in the right direction. 

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BlipLake Norman.com

 How would you like to save money AND support our local Lake Norman businesses?  Well, thanks to Tim Ready, a local Lake Norman resident, it has never been so easy!

It all started when the Mooresville South Iredell Chamber of Commerce announced their “Buy Local” campaign in an effort to gain support for all of our locally owned and operated businesses during these challenging financial times.  When Tim learned about this campaign he told me “a light bulb went off”.  He did some research and launched BlipLakeNorman.com.

The premise of BlipLakeNorman is simple:  Local businesses sign on to be a member, consumers like ourselves get a BLIP keytag (Like a grocery store tag) which are available at any of the businesses that are members.  Every time you go into a business that is a member of BlipLakeNorman you get a specific discount.  For Example (This is from their website as of today, November 2, 2009 and will most likely change so please go to BlipLakeNorman.com for the latest discounts!):

• Custom Creations By Tina
  30% OFF Arrangements
• Primal Force
  Get the Gear You Need At A Great Price!
• The Wine Loft
  $1 off any vodka drink , $5 House Wine – Menage a Trois, red & white, Wine Tastings, 1/2 Price Bottles of Wine, $5 Special Martinis
• Barista Bob’s
  FREE Small Latte, 20% OFF Custom Gift Baskets, 10% OFF Coffee, Save on Party Packs, 15% OFF Fall and Signature Drinks
• Clipper’s Flowers
  10% Discount
• R. J. Gator’s
  2 For $20 Dinner Entrees, $8.99 All You Can Eat Wings, $19.99 All You Can Eat Crablegs
• Pomodoro’s Italian American Cafe
  FREE Small Cheese Pizza

Why buy Local?  Here is a great list of reasons provided by BlipLakeNorman:

• Keep money in our community
• Support community groups
• Keep our community unique
• Reduce environmental impact
• Create more good jobs
• Get better service
• Invest in our community
• Put your taxes to good use
• Buy what you want, not what someone wants you to buy
• Encourage local prosperity

A list of participating businesses is also available on their website.  So, go out and get that free dinner at R. J. Gators, that small latte at Barista Bobs or find out what Fishing with Gus has to offer!

Wow, tonight is Halloween and then November is here!  By the end of the month it will look like winter as most of our trees will be bare.  The month of November is a busy time in the garden between collecting all of the fallen leaves, the final planting of our winter annuals and bulbs and mulching.  Our Fescue lawns will remain green all winter but other than an occasional mowing we gardeners are left to peruse landscaping books thinking about what fun plants we can add in the spring.

Did I mention our Carolina Blue skies?  Here is a photo I took several days ago:

But I digress!

To make your desktop calendar, go to the round button at the top of this site’s home page entitled: “Lake Norman Calendar”.  Click on this button and up will come an image of my Lake Norman photo wallpaper calender for November 2009.  All you have to do is right click and select “set as background”.  Enjoy!

While I have great fun taking pictures of Lake Norman, I would love to use one of your favorite photos depicting life here in Lake Norman!. If you’d like to submit a photo for a future calendar, please send it to… 

Waterfront homes on Lake Norman NC are selling.  I know because I have been selling them.  That’s the good news.  Depending on your own perspective, the bad(?) news is that of the last three waterfront homes I have sold, two were distressed sales where the sellers lost money and one was a foreclosure.

In my opinion there are currentlytwo categories of waterfront homes for sale:

• Distressed sales such as short sales, pre-foreclosures, foreclosures and bargains where sellers are able to price at the current market or below
• Over-priced listings where in sellers have negative equity or they simply aren’t motivated enough to lower their prices to sell in this market

After a  little research on the Charlotte MLS, I came up with some numbers of interest:

Lake Norman Waterfront 5-Year Sales Analysis

Here are some critical numbers:

• As of today, we currently have 27.8 months of supply of waterfront homes for sale which is almost 5 times the amount we should have in a balanced real estate market.
• While the number of  waterfront homes sold the past three months increased by 22% when compared to the same period last year, our waterfront homes sales have plummeted by -65% from their high in 2005.  Still, it is important to see that waterfront home sales are improving.
• The average sales price of a waterfront home increased until 2009.  Since the beginning of the year they have dropped -12%.
• While our average sales price is about equal to 2006, the average dollars per square foot for a waterfront home is back to our 2005 prices after peaking in 2007.  The price per square foot has dropped 20% since their highs just one/two years ago.

The average price of a waterfront home currently for sale is $1,098,431 which figures out at $275 per square foot or 30% higher than the average sales price per square foot.  Granted, the very high-end homes do skew these numbers a bit but the trend is clear.  Bargains are selling and over-priced homes are sitting.

When I first calculated these numbers I was not surprised but none the less taken a back by how they supported my recent experiences to the T.  As a rule of thumb, I had found that prices were back to 2005 so when I pull tax records for my buyers or sellers and I see a purchase date more recent than 2005 I already know that there is a good chance the sellers have negative equity in their home.

While we read that much of the country’s housing markets are improving, my discussions with brokers and lenders throughout the country and my research indicate that Lake Norman home sales trends are about 10 months behind much of the country. 

I can’t emphasize enough how important our levels of active listings are to our recovery.  In states like California, where the recession hit early and hard, they are experiencing multiple offers on their distressed/foreclosed properties and their months’ supply of for-sale inventory was 4.2 in September compared to our 18 months in Lake Norman over all. (And our 27.8 months of supply of waterfront homes).

This is a GREAT time to be shopping for waterfront homes.  (If you are a regular reader of this blog you will know that I don’t think I have said this once in the past two years). While a good portion of the homes are still overpriced, there are some incredible bargains popping up.  And, while these bargains are selling at a reasonable pace, we are not yet experiencing multiple offers so it is even possible to negotiate prices down on foreclosures!

In the next two reports I am going to analyze New Construction and Luxury Homes over $1million.  Stay tuned!

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 Lake Norman Real Estate:  Why is it so hard to buy a home right now?

Lake Norman Real Estate’s September 2009 Home Sales

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Some would argue that an analysis of any two-week  period in our Lake Norman  real estate market is simply too short a time time frame to be meaningful.  However, I have found that these monthly two-week reports, especially when put in context with the past 5 months, can actually provide us with a good pulse on trends in the Lake Norman housing market.

Today’s report is another great example of this

The above chart is a summary of today’s “Hot Sheet” from the Charlotte Multiple Listing Service for single family homes in all of Lake Norman (area 13).  These numbers represent a real time snapshot of the past two week’s activity.  As always, I have included the past 5 months so that you can put these numbers in perspective.

Highlights:

New listings , while low compared to most months, they did increase slightly compared to last month.  We still have 1434 active listings in Lake Norman as of today which is about even with last month.  One of the most important components of our Lake Norman housing recovery is a decline is inventory.  We are on track to sell about 70 properties in October which translates to about 20 months of supply or almost 4 times the inventory for a balanced housing market.

The number of properties that came back-on-the-market, most likely due to cancelled contracts, dropped significantly!  Despite the challenges of the current loan market, it looks as if Realtors and buyers are working better with the banks and perhaps buyers are more motivated to buy because they are purchasing a foreclosure or short sale.

The number of price changes also dropped significantly.   This is a bit surprising considering that prices are dropping around Lake Norman. We will have to watch this trend.

Pending home sales are significantly lower.  Since these are an indicator of future closed sales I predict our October sales will be about the same as September.

The number of closed sales in the past two weeks are back up when compared to last month but still below our summer highs.  

Contingent and Conditional sales remain steady.  Since these are properties that just went under contract, these may translate to a stronger November than last year.  

What I have been observing lately with my own buyers is an increased willingness to consider buying this fall or winter rather than waiting for the “bottom” of the market.  This is because they are seeing true “bargains” and understanding that there are some great opportunities to get into a home they could not have afforded several years ago.  In the past two weeks I have negotiated a Lease/Purchase, two short sales and am working on a foreclosure.  This is the reality of our Lake Norman housing market right now.

RELATED ARTICLES

 Lake Norman Real Estate:  Why is it so hard to buy a home right now?

Lake Norman Real Estate:  Affordable Housing at The Point, WOW!

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