Residential real estate in the news

By Jason • October 27th, 2009
Raleigh Real Estate News Blog

Home prices rise again

According to the today’s Case- Schiller index, prices in most major cities rose in August. However, Charlotte, NC actually decreased after 3 months of modest gains. Based on the index numbers, Charlotte home prices are approximately 9% lower than their peak in August in 2007. I have seen the same type numbers in the Raleigh area as well. Currently, all 20 markets tracked are still negative compared to a year ago, but overall the index has been improving.

It is important that you keep in mind that the report is for August and is not current. Also, we are in Raleigh and have a different economic base that drives our market.

What to expect

  • Prices to stay relatively flat  through the winter months, signalling that we definitely are at the bottom and it’s just a matter of time before we move up.

-OR-

  • Prices dropping back to levels reported for the first of the year, reversing the gains we saw over the summer.

It’s well known that the government incentive for first time buyers has been a tremendous help to the housing market. I’m not advocating government handouts so please don’t turn this into an argument, but it’s been a successful program by putting money directly into the consumers hands. Even the Cash for Clunkers program that was a mess was still effective at doing just that. The governments decision to continue the program or slowly phase it out vs. ending it December 1st will be a big tell as to what we might expect.

The bottom line

The time to buy in the Raleigh market is now. Even if we see 1% drop in prices over the next 6 months, your long term gain will be enormous in as little as 3 to 5 years (Which is the amount of time many first time home buyers stay in their first home.)

Retail has adjusted

I learned earlier today that Charlotte based Belk Stores has just re-instated their 401k match to their employees and scheduled employee hours have been increased to normal levels. Sounds like they are seeing the light at the end of the tunnel, too. So keep that in mind when you hear all these national reports about consumer confidence.

For more reading:
Charlotte home prices sag after 3 months of gains
http://www.charlotteobserver.com/business/story/1022463.html
Big Rebound in Existing-Home Sales Shows First-Time Buyer Momentum
http://www.realtor.org/press_room/news_releases/2009/10/rebound_shows
S&P/Case-Shiller Home Price Indices
http://www2.standardandpoors.com/portal/site/sp/en/us/page.topic/indices_csmahp/0,0,0,0,0,0,0,0,0,1,1,0,0,0,0,0.html
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