Charlotte’s real estate market is starting to level off, according to the latest data from Canopy MLS.
Why it matters: After two-plus years of plummeting inventory and sky-high home prices, Charlotte buyers have waited a long time for a little relief.
What’s happening: Supply is going up and demand is going down. That shifting dynamic has finally caused home prices to decrease.
- Mortgage rates, which have reached 6%, are the number one driver of the market right now, according to Jeff Clay, owner of JClay Realty Group.
By the numbers: Inventory is up 25.8% year-over-year — the highest it’s been since May 2020, per Canopy.
- Pending sales and closed sales are down 22% and 18%, respectively, compared to this time last year.
- And while median and average home prices are up year-over-year, they’ve fallen in recent months.
- For example, in June, the median sales price was $400,000 and in August it was $388,505.
Also of note: For the first time since February 2021, sellers aren’t getting 100% of their asking price anymore. On average, homes received 98.5% of the original list price in August 2022.
- This time last year, homes were selling for 101.5% of the listing price.
- This is one of the leading indicators of the market rebalancing, says Bree Vaughan of Keller Williams.
Homes are sitting on the market a little longer than usual, too. In August 2022, homes sold in 19 days on average, compared to 15 days in August 2021.
What it means: Buyers have more options so they can take their time and have more negotiating power, especially if the house doesn’t sell within the first five days.
Flashback: In 2021 buyers had no bargaining power. It wasn’t unusual for buyers to have to quickly offer $100,000 over asking with $15,000 in due diligence and an agreement to pay the appraisal gap if there was one, Vaughan says. That’s not the case today.
Now, you might be able to get the seller to take on some of the closing costs and come down on the asking price, Clay tells Axios.
- The days of 25 offers on one house are over, but it’s still common for well-priced homes in desirable locations to have a handful of offers, he added.
The other side: These market changes are only helpful for people who can afford to take on the 6% mortgage rates. Higher monthly payments have priced some people out of buying right now, Clay said.
What’s next: Vaughan doesn’t predict a complete buyers’ market, but it’s possible the rest of 2022 starts to feel more like it did pre-pandemic.
The bottom line: Buying conditions are calmer now than they were a year ago. But many people can’t, or won’t, buy right now because of higher mortgage rates.