How is the Wilmington NC Real Estate Market Stacking Up Against National Trends?

I must admit, I have been guilty of talking about the local real estate market here in Wilmington with more emotion than actuality. 

Why do I sometimes talk about the market with emotions instead of facts?

Well…I believe the Wilmington NC real estate market has been and will be a great market for many reasons for years to come.  But my opinion on the market’s potential and its actual current performance are two different things. 

As a local Wilmington real estate agent, I have the privilege of witnessing first hand the excitement that people have when relocating here.  Additionally, I have noticed many sellers’ desire is to move across town rather than leaving town.  Let’s face it, Wilmington has a lot to offer with its easy access to local beaches, the historic downtown riverwalk, shopping, and nightlife.  And the city continues to grow with new plans of development that will enhance what Wilmington NC has to offer the world around us.

Yet, a look at some basic real estate market statistics will show that Wilmington’s real estate market has slowed down considerably.  No matter how excited I am about what Wilmington has to offer, and the future growth of Wilmington, the current facts are the facts.

Should Local Real Estate Agents Be On Top of Current Market Trends?

I do feel it is important that local agents are aware of the current local real estate market trends.  It can be time consuming to pull this data together.  As agents, we don’t have programs with stock ticker graphs rolling across our computer screens.  We have to go into the MLS database to draw these stats out ourselves.  And that means work.  (And for me, lately my time has been consumed with working with clients.  Thus, my promised market reporting is a bit overdue.  For my regular readers, thank you for your patience.)

So how is the Wilmington NC Real Estate Market Stacking Up Against National Trends?

Today, we are going to look at just two market indicators to compare Wilmington to US real estate market trends as well as the Southern US Region’s market trends. 

NOTE:  This is not a comprehensive picture of the market, but it will give you a decent snapshot of Wilmington’s local market trend compared to the national and regional level. 

The first market indicator is the Pending Contracts written in the past two years. 

A Look at Pendings

Pendings are a forward looking indicator.  Pendings refer to how many contracts were written.  When a property is pending, it means a seller has accepted a buyer’s offer and the property is now under contract.  Two things to note on Pendings. 

1. Roughly 75% of pending properties actually close.
2. The escrow period of a pending property is typically 30-45 days.  But this can be significantly longer with new construction.

In 2006, US Pendings were down 10% from 2005.  In the Southern Region of the US, Pendings were down only by 6%.  Zoom into Wilmington NC (more specifically, New Hanover County but excluding the local beach markets), Pendings were down 26% from 2005 to 2006 (see graph below).  This was the first sign of the slow down for Wilmington’s real estate market.  The evidence really didn’t show up in the Sales index till the fourth Quarter of 2006.

In 2007, US Pendings slipped 14% from 2006 - a much more aggressive fall from 2005 to 2006.  In the Southern Region of the US, Pendings came down an additional 15%.  Wilmington’s Pendings fell by 12% from 2006 to 2007.  Though the Pendings continued on a downward spiral for Wilmington in 2007, it was not as aggressive as the previous year.  (Sorry. I can’t figure out why the numbers are missing on the Y axis of the graph.)

 

 

A Look at Sales

For homes that actually closed, we call these Sales (or Solds).  On the national level, Sales for 2006 fell by 8% from 2005.  In the Southern Region, a more conservative loss of 5%.  In Wilmington, Sales were down by 19% in 2006 from 2005. 

Comparing 2007 Sales to 2006 Sales, the US real estate market trend continued its downward turn by a 13% decrease.  The Southern US region mirrored the national downward trend with Sales down by 13%.  Wilmington’s Sales out paced the national and Southern downward trend by an additional 21% decrease in overall house sales for the year. 

The Wilmington Average and Median Sales Price Continued to Climb

In 2006 and 2007, the Average and Median Price continued an upward climb for homes sold in Wilmington NC.  The Average Sales Price peaked in October of 2007.  I was a bit perplexed at this trend given the downward turn in Sales and Pendings.  I posted on this phenomenon back in December ‘07 and put my local real estate predictions for Wilmington on the line for 2008. 

As I expected, the Average and Median Price have come down in 2008.  How much have they come down you ask?  Stay tuned by becoming a Wilmington NC :: Real Estate Subscriber TODAY!  You can subscribe by RSS Feed or by Email Subscription so that you do not miss a post. 

So the Moral of the Story?  

When you hear a local real estate agent tell you the Wilmington real estate market is sizzling compared to national trends, you can take that to mean what they really want is for to you buy or sell a home. 

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On that Note:  If you are thinking of buying or selling real estate in the near future and would like to be personally educated on the full picture of the Wilmington real estate market so that you are making the best possible decisions, CONTACT ME TODAY!

www.WaltDowdy.com