June Market Update

One of the great things I love about my profession, being a full-time local Realtor since 2003, is that the real estate market always tells on itself.  With the average sales price being up almost 13% in Craven County this year, the real estate market is telling everyone: “Now is a great time to buy, sell and invest in real estate around our area!”  The real estate market will continue to grow as Craven County grows, which means homes will become more expensive as inventory levels remain low.

Craven County’s growth will continue to be the catalyst for our real estate market to grow.  Craven County is not only growing with more people moving here to retire, but we are also seeing several jobs being created due to more businesses coming to our area, as well as Cherry Point increasing the number of Marines and FRC East employees.  Employment opportunities increasing for our area can only be a positive, as this will provide more opportunities for local people as well as others moving to our area.  The one issue that Craven County and a lot of North Carolina is facing, is keeping up with the demand for homes for people to live in.  Drive around most anywhere in Craven County and you will see houses and apartments being built.   Currently there are only 108 homes for sale in Craven County that are not new construction.  There are 133 new construction homes for sale with most of those not having started construction.  In fact, about half of the new construction homes listed for sale, the builders don’t even own the land that the houses are listed on.  Therefore, we have 108 properties for resale in Craven County that range from $47,000 to $2,700,000.  For perspective, ten years ago we had around 1550 homes for sale.  Developers can’t develop property and builders can’t build homes fast enough to level out inventory issue anytime soon keeping supply and demand out of balance.  The lack of balance is still making it difficult for buyers to find homes and one of the main reasons buyers should continue to try to find a home as prices rise.  Yes, it is difficult to find a home but don’t give up hope just because it is challenging. Make sure you have someone working to help you find a home and not someone just opening doors in homes you would like to see, as there is a difference.

The market is telling us that mortgage rates are higher than they were last year.  This is true and just because the scale in my bathroom shows a higher number than it did a few months ago, does not mean I should stop exercising!  Interest rates are higher than they were a few months ago and a lot higher than they were 18 months ago, however, that does not mean one should stop their dream of owning a home or investing in real estate.   If you are renting a property, you are currently paying an interest rate of 100%, which is much higher than the 6-7% interest rate mortgage lenders are offering.  As a homeowner, not only do you get to build equity in your home instead of paying for your landlord’s investment, but you also have the right to stay in the home or move out of the home whenever you want and take advantage of the equity you have built in the home.  As a homeowner, you know approximately what your monthly payment will be, though it will vary a little over the years as the cost of taxes and insurance will increase.  A homeowner is not at the whim of a landlord telling them to move out or that the rent is increasing.  

Due to higher interest rates, we are seeing buyers backing away from the buying process as they “wait for interest rates to go back down.”  Waiting for interest rates to go down will cost buyers thousands of dollars and in some cases, tens of thousands of dollars!  The average sales price in Craven County has increased almost 13% this year and is up over 19% from May 2022.  As buyers wait for the mortgage rates to fall from what is basically the last 40-year average rate, prices will continue to increase.  A buyer should want to be locked in at today’s prices as we can never change the price of a home once we purchase it.  However, homeowners can lower their mortgage rate when the time comes that mortgage rates do decrease.  Let’s do the math on how much waiting for interest rates to lower may cost you on the purchase of your home.  We know the average sales price of homes in Craven County for this year is $317,990 and home prices have risen over 19% since last May.  The average home last year would have cost you approximately $60,000 less than it does this year.  The same average home next year will likely cost you at least $30,000-$40,000 more, if price increases slow down as some economists are predicting.  I’d rather save tens of thousands of dollars now than $50-$100 on my mortgage payment, especially since there will be no savings once prices rise.  Also, if you think we have inventory issues now, when mortgage rates go back down, many more buyers will be competing for even fewer homes, only driving prices higher.  If you are on the fence about buying, questions are answered for free by our great local lenders and Realtors.

Sellers are wondering why it is a great time to sell now if prices are going to continue to rise. A lot of homeowners are locked into a much lower mortgage rate and have substantial equity in their home.   Just like buyers needing to buy, if a seller continues to wait to sell, the property they will purchase will also only continue to get more expensive.  With the amount of equity gained over the past few years, sellers can use that equity to possibly pay cash for their next property.  We are still seeing a lot of cash offers in the market and with cash, mortgage rates do not matter.  Homeowners also need to sell for many reasons.  People get married and have children, therefore they need more space.   People get divorced or retire so they want less space. Mortgage rates and the possibility of making more money off your house should not delay someone from following their dream of getting a different home.  I do understand that mortgage rates and making more money can be a factor in a seller’s decision to sell or wait.  I just do not believe it should be the only deciding factor.  The great thing about a seller deciding to sell now is there are buyers willing to buy, despite interest rates.   With low unemployment, a lot of growth in our area and people retiring to eastern North Carolina, sellers have a prime opportunity to have a buyer pay top dollar for their property in the current market.  As stated, the market will always tell on itself, so a seller must price a property properly in all markets.

As we continue to navigate the current market, know there are local professionals to help along the way.  Reach out to your local reputable lender and financial advisor to discuss the financial side of buying, selling and investing in real estate.  Reach out to myself or other professional Realtors that can guide you and be a resource for reputable lenders, financial advisors, inspectors, real estate attorneys and more, that one will need as they buy, sell and invest in real estate.  The real estate market does tell on itself and the story it is saying now, and appears to be saying for the future of Craven County, is now is a great time to buy, sell and invest in real estate!