If you are in the market to purchase a home, in terms of financing, you can’t go wrong right now. Mortgage rates fell to yet another record low with the average interest rate on a 30-year fixed-rate mortgage at just 2.67%. That is the lowest level in nearly 50 years according to CNN. The 15-year fixed rate has dropped to 2.21%.
This would be great news for buyers if there was more supply on the market. These great rates come at a time when we also have historical low inventory with the Charlotte area at just a 1 month supply of homes, or just 4,554 homes. This is down 52.4% from what we thought was a historical low last year of just 9,568 homes.
According to the Canopy Realtor Association monthly report from their MLS system, prices are also headed up. The average home in the Charlotte area sold just shy of $350,000, up 14.2% from last November. This gives buyers a little pinch in the pocketbook as they have to pay more for a home this year. It can be offset by lower interest rates, but real estate taxes will also go up due to the higher prices.
Homes are selling more quickly as well. Last year it took an average of 42 days for a home to go under contract and 92 days to head to the closing table. This year, homes are going under contract in an average of 24 days and closing in 77 days. What this says is that buyers have to be ready as soon as a home hits the market. They need to have their financing in order and be ready to write an aggressive contract to secure a home. There have been many homes that get multiple offers further driving prices up.
New listings were up 7.9% year over year, but couldn’t keep pace with demand. The new listings also couldn’t make up for the slow spring with the year-to-date new listings lower by 2.9% over last year. That is an impressive showing though considering the uncertainty of the pandemic.
Pending sales are still going strong and they are up 26.4% from this time last year. This shows us that the market will stay strong as we head towards the new year as these transactions head to the closing table.
Closed sales have recovered from the spring slump and have passed last year by 4.2% rising to 49,010 so far for the year. These sales are selling for an average of 98.9% of list price so buyers can’t expect much of a discount as sellers still have the upper hand in negotiations.
Looking forward, analysts expect the real estate market to stay robust, but the seller’s market may ease a bit as people who were reluctant to list their homes in 2020 may list them in 2021. Realtor.com has ranked the Charlotte area the third best market in the country for 2021. Looks like next year has the potential to make up for this year and could bring the market closer to a balance between buyers and sellers.