December 2021 Market Update

WILMINGTON, NC - In this video Buddy Blake, the owner of Waypost Realty in Wilmington NC, goes over the recent real estate market stats and what our local regional market is experiencing as we approach the end of the year.

All right. Today is December the sixth, Monday, December the sixth, 2021. I hope everybody has a great December going on. It is mid to upper 70s here in Wilmington, North Carolina today. It is amazing. Anyway, guys, I'm going to shoot over some basic market info from last month, give you the latest and greatest. Things continue to shift around a bit. We are seeing indications that the market has slown in many parts of the country. And here also in our local slowdown is mostly due to the lack of inventory. We're just not seeing the houses hit the market, we don't have the new home inventory coming to bear, and we don't have presales in most cases for new homes. So it's tough. I know right here, we've got our in-house lender, Paul Bowers with our Waypost Mortgage company. And I think we've got 14 or 15 pre-approved ready to go buyers in all kinds of price ranges, not just low price ranges. They have not been able to find houses, some of them have made offers on three or four houses, well above asking and still haven't got it. But then we got other situations where houses are sitting on the market and they're not selling, we're seeing price reductions, seeing more price reductions than listings.

But I think what we've got is we've got a combination of a few things. We've got a lot of not great properties come out at this time, people are trying to get rid of. We've also had a lot of sellers that are just testing the market, just to see if they can get some crazy number and they're not really committed to selling. And then we got people just asking too much, and they pushing too far.

So anyway, so let's get going here. First off average price. I ran this back three years just to give you some perspective. COVID was right here. So you can see this is not a natural transition right here. And three years ago it was 270, 260,000 dollars was average price in our three county area right here you'll see. Now we're up into the four thirties is the average price for a single family property in the three county area. Now do keep in mind we have a strange market here, or we used to, we used to have a fair amount of properties in the low to mid 100s, we don't have those anymore. And then we multimillion dollar properties too. But the three county areas are pretty good mix, there's enough sampling in there. But 430, so it has gone up almost $200,000, which is difficult for a lot of folks.

Now, this is our pending sales. Actually ran this back all the way to the records that we had 2004, right before the last break or bust up. And the reason I did that, I wanted to show, I mean, it is slow this year. Last year we really did not get the same kind of seasonality slow down in December and November last year of contracts, because we had inventory. This year we have slow down because people quit listing as many houses during the holidays and also there's just not much inventory. And the new home thing is really messed things up for us because the pre-sales, a lot of times we'd be writing a contract now, putting somebody on the contract for a house it'd be ready, six to eight months. And a lot of home builders simply aren't doing that due to the uncertain times and supply lines and costs and things like that. But you'll notice this, the ups and downs and ups and downs, in November, December, January, February, that's always kind of the down and then it rebounds.

But this one right here, you'll see last year right here, this was a long stretch up, and this is when all the activities started going crazy. And then it slowed down a little bit, but then right here, we didn't get the fall like last time. But now, we're seeing a double dip here. We haven't seen this double dip like this in a bit. So, personally my thinking, and this is just my world of thinking, I think that we've seen the best days. Are we going to still see multiple offers in certain areas and price ranges? Absolutely. There's no question about it, because of lack of inventory. But once the inventory starts coming online, you're going to see that go away. And unfortunately, the way we human beings act is we typically, me included, we don't put that property on the market thinking it's going to keep going, keep going, keep going. And then when we see things changing a little bit or get a little concerned, we throw it out there based on the data that our friends told us, or we saw months ago and we put it out there and then it doesn't happen. And then we're chasing it down and then get upset at whoever's involved with it and blame them.

But, truth of the matter is people who are putting their house on the market right now, if it's in good condition, good area, and it's price reasonably, it doesn't have to be priced great now just reasonably, within some sense of the realm, it's selling quickly, because there's nothing out there. You have no competition, nothing like the competition you're going to have come January, February, and certainly March and April, that is when the onslaughts coming. Plus you're going to be fighting and you're going to be competing head on with all the new construction that's coming to bear. The presales quit April, May, June in a lot of cases last year, so that means those houses that normally would've been under contract already are going to be coming on the market first quarter next year.

So if you've got a house in, I'm going to say, in the four to five to six range, a resale, and you're thinking about selling it next year, you going to have a lot of stiff competition in the new home sector next year, because there's going to be a out of houses coming online in our three county area, a lot of new homes coming online. So all you got to do is look at the permits and just drive around and see it. But you're just not going to see it in the MLS, you're not going to see it on Zillow, you're not going to see it on a website because no builder wants to deal with that right now. They're trying to finish up the people that are under contract, they don't want to create an argument with somebody else that's wondering when's my house ready, when's my house ready, when they don't have the answers. I'm not defending anything, but the truth of the matter is home builders in a lot of cases don't know anymore than the consumer knows because they're just upheld. Personally, I ordered windows for a screen porch at my house in March, and it is now December, it is nine months later and I still don't have windows. So I don't like it, but I understand it.

But anyway, all right, so this is pending sales, this is the tip of the spear, this is when it goes under contract. This is when the sale actually happens, not when it closes. Homes for sale, here's our issue. This is the inventory. You can see back in 06, 07, we had low inventory, 05, boom went from 4,000 to over 10,000 homes available in our three county area. Now we are down to less than 2000, probably 1700, 1600 homes available in the entire three county area, I've never seen it this low. So you can see for yourself what the dilemma is, we've just eaten up all of the excess houses that we're sitting out there at any given time, the ones that expire, they just have sold. So we are down to the few. And if your house isn't selling and your house is on the market right now, you are either overpriced or there is something terribly wrong with your location or your house. That's all I can tell you. And you need to address it or drop your price, or probably both. That's just my opinion.

Let's see. Next thing, this is Hanover County. This is absorption reports. And down below, you're going to see some links where you can actually download the full reports on these. These are PDF reports you can pull up. All I want you to look at over here right now is just look at the color code, and then the red, this is month supply. Basically what it means is if we quit listing houses in this price range, we would run out of houses in one month in this case right here. So just take a look. You can see 300 active in Hanover County, 404 pending, there's more pending than there is active. And then in the last six months, 2,300 have closed, which is a crazy, crazy number. You can see the prices here, the prices are doing quite well. 99% of ask, in a lot of cases we've... Now, what that does compensate is we have a number of them selling for well over asking, but we have some that's selling for under too, especially as you climb the price range.

I will tell you that last month, this right here, this was red. We were about one, less than two, months supply in all price ranges up to 2 million. So you see these oranges, this is new. We haven't seen this in a number of months, certainly not a yellow where you're starting to see some inventory start coming online and days on market start increasing. So this is three months, four month supply. So we are seeing it happen and it always happens from the top down.

This is Brunswick County, you can see it's pretty solid red still, super busy, not a lot of inventory. Brunswick County's the largest county in North Carolina and there's only 555 total properties. That's everything, that's not just single family, that's multifamily, that's condos, town homes, that's all of it.

Pender County, same thing. All the way up until about a million it is rock solid red, so it is super busy. And again, I think you'll like these reports if you download them, and they'll be very helpful.

Mortgage update. Paul's not with us right now when I'm doing in this, but if you need a mortgage, our in-house guy, we have a joint venture with them and we have our own mortgage firm called Waypost Mortgage. And Paul is our go-to guy, he does a phenomenal job. If you've got a mortgage quote and you want to make sure to kind of keep where you're at on us, he'll do it for free, doesn't charge you anything. And also if you've got an online quote from some of the online mortgage companies, I highly recommend get with a local mortgage company, especially in a coastal area, because those companies just don't know what coastal issues are. They don't understand the flood plains, they don't understand flood insurance, they don't understand wind and hail insurance, they just don't understand those things the same way that local folks do.

But Paul is an advisor first, he doesn't charge for it and he does a fantastic job. He'll get a pre-approval for free. If he can't do the job he'll tell you, if you got a better deal somewhere else he'll tell you. I think it's a great, great solution for you. So much so that we brought it in house because we want to take care of our clients, because so many of the lenders that are out there now it's been busy and the customer service and the response time has not been great. Paul does a phenomenal job and he has room for more clients.

Anyway, I hope this is helpful. If you'd like any more information, more specific to your neighborhood or your community let me know, be glad to share it with you. Just know that the online valuation systems are pretty weak. I don't know if you've been reading the news about Zillow, Zillow offers, which where they were buying houses. They have stopped it and moth bought it, put it on the shelf because their algorithms on their pricing was apparently off quite a bit. So now they're sitting on 7,000 houses that they overpaid for because they used their own algorithms. So just be careful. Automations are fine to get some ideas, but if you're getting ready to sell your house or do something with it, you need an evaluation for an estate purpose. First off, you certainly can call a certified appraiser, pay four, five, $600 to get an appraiser, whatever the number is. Or you can call your trusted realtor and they can run a car and a lot of market analysis for you with the same kind of data from the MLS system that appraisers use. We can't do a certified appraisal, but we can certainly give you some really good price opinions and market condition reports. And I think you'll find them very useful.

Anyway, have a great week. I will be back and talk with you before Christmas. And want to wish you and your family are Merry Christmas, and if we can do anything in our world to help you, please don't hesitate to reach out. Thanks.