One of the most frequent questions that we are asked as Realtors is – “How is the real estate market doing?” At the risk of stealing lawyers’ favorite line, the answer is – “It all depends.” The simplest explanation is that it all depends on the time period which we are analyzing. If we are talking about monthly results on a standalone basis, we are looking at the equivalent of a still photo. If we are talking about longer term trends, the analogy would be like looking at a moving picture.
Let’s use the October Hatteras Island major real estate indicators to illustrate the impact of time on our market perspectives:
- One of the brightest spots in the island’s current market performance is the number of residential properties for sale. In October, the number of homes available for purchase was 146. This was more than double the number in July of last year and significantly above the longer-term average of 98 over the past 22 months. The trend is clearly upward which means that buyers are seeing an increase in the variety of properties from which to choose.
- In other good news, the number of homes reported sold last month was 23. While the number of sales changes from month to month, this level of buyer activity was close to the average 20 sales per month since January 2023. In short, the trend line in sales has risen slightly over the last two years.
- Turning to the price performance of residential properties, the median sale to price in October was $542,500. This was in the middle of the $500,000 to $600,000 range and not too far beneath the long-term average of $590,000 – good news from sellers and reflective of a pattern of rising selling prices over time.
- Finally, in October there were 27 homes under contract to be sold. Properties under contract are generally considered to be a leading indicator of future sales which take about 60 days from the contract date to the closing date. This was the lowest number of pending sales for any month so far this year. A declining trend in under contracts is difficult to figure out especially in comparison to the number of home sales which have been fairly consistent. Since January of 2023, there has been an average of 34 residential properties per month under contract to be sold.
In summary, I think it would be reasonable to conclude that we are seeing improvements in what has been a relatively slow longer term real estate market on the island. We will have to wait to see what, if any, impact the recent election might have on our local market.