Last week, the Charlotte Observer posted a story that the housing market in Charlotte is so tight that there are only 1.6 months supply of housing inside the city. The supply of housing metric is one that Realtors and economists use to judge how balanced or unbalanced a housing market is. A “normal” housing market is around 3-6 months of supply – meaning that if no other houses hit the market, it would take 3-6 months to sell every home currently for sale. 1.6 months is extremely scant, which is leading to some buyers abandoning the dream of home ownership altogether. However, is there really 1.6 months supply of housing in Charlotte?
If you take the entire market and divide it by the current months of sales, yes – you will approach something close to 1.6 months supply of housing. However, that would be like going on WebMD to diagnose a rash, determining that you have a rare flesh-eating virus, and never visiting a doctor. There’s more to the story – a lot more.
The Market Under $300,000
Houses under the magic $300,000 price point are moving relatively quickly. Data taken from last month show that the supply of houses under $300,000 is less than 1 months supply in Charlotte, Huntersville, Matthews, and Waxhaw (the four areas I used for comparison). While that’s definitely tight, in real numbers, that equates to 756 homes active homes for sale on the market right now. Add the number of new construction offerings that are available and the number jumps to 861.
As a result of this price point being relatively tight, it won’t leave a lot of room for negotiating with most selling within 99% of the asking price.
$300,000-$400,000 is a Different Story
When you cross over the $300,000, things start balance out. Homes in this price range in Charlotte, Matthews, Waxhaw, and Huntersville are on the market for around 40 days on average and there is more than a 2 month supply (excluding new construction). This is still lower than a year ago but things are slightly more balanced. There are 318 homes for sale in Charlotte alone in this price range. Additionally, they are selling between 96-98% of the original list prices.
Move Up to $400,000 – $600,000 – Much Different Market
As you would expect, as the prices increase, the market for these homes gets a lot smaller. Still, for many move-up dual-income home buyers, a home in this price range is a reality. Excluding new construction like before, the months supply jumps in Charlotte to 3.2 months. Matthews and Huntersville move to 5.6 months and 5.1 months respectively and Waxhaw rises to 4.7 months. In terms of real numbers: 346 homes for sale in Charlotte, 63 Matthews, 85 Huntersville, and 90 in Matthews. Account for the new construction listings and the number of homes available for sale in Charlotte in this price point rises to 452.
These homes are also on the market between 35-48 days and these homes sell between 96.4% – 97.8% of their asking prices.
$600,000 – $1,200,000 – Hello Inventory
In comparison to the lower end of the market, there is a relative plethora of homes available for sale in this price range. In Charlotte, this range has over 5 months supply of housing, with 332 homes for sale in the market. When you add in the new construction listings, the number jumps to 437; which is consistent for the last 3 years. In Waxhaw and Huntersville, the market stands at 6.1 and 6.8 months respectively. The supply in Matthews is at 9.3 months, which is closer to what it was at this time 2 years ago.
This price point seems to offer Buyers a little more negotiating room as well, with homes selling between 94.1%-96.5% of their original list prices.
So, is it hopeless? Is the only solution to finding a place to up the price or look well outside of Charlotte?
Well, maybe but don’t discount exploring other neighborhoods and nearby cities that offer everything that you’re looking for. There are excellent neighborhoods all throughout Charlotte; even “in-town” that are affordable and others in the suburbs which have a lot to offer.
So the next time you hear your colleague say that they can’t find a house in Charlotte for less than $300,000, you can point out that there at 66 homes in 28269 and 46 in 28278 for sale right now.