It is important to understand the trends in the market and evaluate those trends against the economic “experts” offering their opinions on the future. It is possible that the adjustments in the market over the past several years will reset the marketplace and establish a “new norm”. In my opinion, there is a new norm in Charlotte’s real estate market. The economic “experts” have stated the economic environment in Charlotte will be lackluster and expand about the rate of the entire country. An expansion not sufficient to create enough jobs that would substantially bring down the unemployment rate over the next three years. Let’s consider the following statistics from the Charlotte MLS.
Month # of Sold SF Units Avg Sold Price (rounded)
June 2005 3589 $214K
June 2006 4445 $240K
June 2007 3852 $248K
June 2008 2734 $233K
June 2009 2024 $218K
July 2009 2223 $212K
August 2221 $209K
September 1945 $196K
October 2210 $196K
November 2000 $195K (federal tax credit expired)
December 1527 $211K
January 2010 1364 $200K (market bottom for Charlotte)
February 1397 $191K
March 1900 $197K
April 2220 $201K
May 2537 $212K (same avg. sales price as July 2009)
June 2010 2324 $215K (or is this trending back down?)
It would be reasonable to predict based on current economic “expert” opinions that a “new norm” for the monthly number of units sold in Charlotte will not return to 3,000+ units until 2014.
So bouncing along 2200 – 2800 units per month for the next three years could very well be the “new norm”. This prediction will be influenced by interest rates, tax changes, and all other federal policies. Why is this analysis important to me?
I will adjust my business plan and expectations accordingly. I need to find cutting edge ways to do what I do, differently.
We must focus on “new norms” not on the way it used to be!
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