What’s Happening in the Real Estate business?

I wanted to add just a few words about the real estate business and what is occurring in it. As usual, real estate is always local so your individual market may or may not be similar to the Raleigh-Durham-Chapel Hill market in North Carolina.

The general brokerage report that came out a few days ago from Stacey P. Anfindsen of the Triangle Area Residential Realty (TARR) has some very informative information for any buyer or seller in Raleigh, North Carolina.

First of all, the number of listings have gone down slightly and there are currently just over 8,500 residential listings for sale in Wake County and only about 225 are classified as being owned by a financial institution or have been listed as a foreclosure. Of course, this does not include those short sale possibilities. Therefore, foreclosure listings represent about 2.5% of all current inventory.

Stacey points out that foreclosure activity, as defined by the transfer of title from the Trustee t the financial institution, has accounted for 4.5% of Wake County closings within the past 13 months. He also points out that the average sales price of a foreclosure has been $178,500 and the overall average sales price is $262,800.

The average percent per year loss compared to prior sales price was 3.58% for homes transferred from the Trustee to the financial institution and 3.83% for homes transferred from the financial institution to the new buyer. This means that buyers of banked owned homes are potentially getting these homes for a discount and over time, should have built in equity.

Sandlin Branch, Wakefield and Hedingham are the leading developments where financial institutions have taken title from the Trustees, which means these communities currently have an increase in foreclosure listings on the market.

The majority of foreclosure activity has taken place in Little River-Eastern Wake (10.5%), St. Marys-Garner (10.85%), ad Marks Creek-Eastern Wake (13.45%). White Oak Township, which includes Apex and western Cary has the least amount of activity at .49% of all closings.

This can be spinned either way you want to spin it, whether positive or negative. I choose to be positive and say that the foreclosure market in Wake county is a very small portion of the market and does not impact the overall market. I have found buyers calling and seeing these foreclosures, but in the end, will probably purchase a resale as there are fewer cosmetic issues to address. If a higher portion of our market’s sales are due to foreclosures, at least these homes count as sales in the marketplace and we are reducing the number of foreclosures on the market. As I mentioned before, nearly 60% of all foreclosures in the U.S. are isolated in 6 states, and fortunately, North Carolina is not one of those states. We ranked 1st in population growth last year so we are still a place where people want to live. Additionally, unemployment in Wake county is less than most metropolitan areas throughout the nation.

For more information about the real estate market, please feel free to contact me via email or phone.