Sep. 16, 2008 - Wake County Market Conditions - September 2008
It's that time of year again - the time when the market slows down a bit, the kids are back in school,  and we get to take a look at where the market has been and where it's headed.
What is going on with the real estate market in general?
Gas prices are at an all time high, lending institutions are in total disarray (most recently we can point to the bankruptcy of Lehman Brothers, aquisition of Merrill Lynch), the US housing market is in serious trouble in a number of areas in the country, and the stock market itself was expected to recover with the housing market and that just hasn't happened. Our residential real estate market depends upon the free flow of buyers and sellers. Our market is currently stuck as many inbound transferees cannot sell their out of state residences, many of our outbound transferees cannot sell their local residences and there is a crisis of confidence among a large portion of potential buyers which is playing a role in the ability to sell. While we continue to be praised nationally for strong job growth and a healthy economy the most recent update is that our market, especially in the high price ranges, has taken a beating.
How do sales this year compare to the banner years?
2006 was a banner year in Wake County. Sales were at an all time high. I thought I'd include numbers from the MLS that indicate the change in the market year over year for your reference. Comparing August 2006 numbers with August of 2008 numbers the changes are quite dramatic:
- Supply of homes on the market is up 28%
- Number of homes under contract is down 41%
- Number of homes closed is down 44%
- Average Days on Market are up 27% (83 DOM vs 65 DOM in '06)
| Time Period |
For Sale |
Under Contract |
Sold |
| August 2008 |
11,899 |
1,084 |
1,151 |
| August 2007 |
10,861 |
1,474 |
1,022 |
| August 2006 |
9,328 |
1,851 |
2,073 |
What about the supply of inventory for Wake County in particular?
- The average supply in the Wake County area is running at 8.7 months supply. This is a significant change from the 3.7 months that we saw back in August 2006 - up 138% during this timeframe.
What about market appreciation?
Fortunately, in this area, we have not had the run up in prices experienced around the rest of the country which has helped maintain some stability in sales and pricing. And, appreciation rates have remained stable in Wake County at 4.5% vs. -4.8%% for the rest of the US in 2008.
Here are some additional market variables that a seller must consider before selling in the current market:
- Higher inventory and fewer closings have produced an oversupply of inventory in all price points above $450k
- Price reductions are up: There has been a 73% increase of sellers taking price reductions
Is there any good news in this segment?
As you can see from the change in price reducations recently it's clear that sellers are finally realizing that Wake County Real Estate is now a buyers market. Up until this fall I had a hard time convincing my sellers that the market had shifted and that, to be competitive in this market, you have to be priced in the Top 3 along with having all of the other wonderful attributes and updates needed to sell a home today. Hopefully the bailout of Freddie Mac and Fannie Mae and the competitive mortgage interest rates will help more Wake County home buyers step up and buy a few homes! Now is a great time to buy in Wake County.
Visit my website or Email me at Tracy@TracySantrock.com for more information on Cary NC Real Estate or the Triangle Market in general.
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