Homes selling for under $150,000 accounted for almost half of all residential sales in the Triad in the second quarter. A tough economy plus the federal $8,000 tax credit for first-time buyers as well as continuing low interest rates are all factors motivating buyers in what some call “the lower price ranges”.
Even with activity at that level, the market continued its downward trend in the second quarter with sales of new and existing homes in Alamance, Forsyth and Guilford counties dropping 29 percent. The median selling price of a home fell 4.8 percent to $150,000.
This trend is causing some builders and real estate agents to shift their marketing efforts. Grover Shugart, president of Winston-Salem-based Shugart Enterprises, said that his firm is introducing several new home designs that will cost $130,000 or less. Shugart is also creating a new division within the company to concentrate entirely on designing for and marketing to entry-level buyers.
Again, the high-end of real estate, houses above $400,000, remains one of the toughest parts of the market. Why? Well, buyers have to have 20 percent down and picture perfect credit. Banks simply aren’t loaning as readily as they did over the last few years.
The number of existing homes on the market in the Triad dropped more than 6 percent in the past year, but real estate industry officials say it’s not nearly enough of a reduction to get sales moving again. The current supply of existing homes would take about 14 months to deplete, according to Don Jud, a former UNC-Greensboro ecomomist who compiles the sales data and a “healthy” Triad market only needs about four of five months worth of available homes.
Some of our inventory reduction is not necessarily from sales, but from sellers who took their homes off the market after months of inactivity. If you can afford to wait, it may be better than taking the inevitable loss now.
What’s your price point and what are you doing to increase your chances for a sale? Be sure to check out our article Marketing – How Effective is Yours?
What creative ideas can you add to help buyers choose your home?
Thanks to Laura Youngs of The Business Journal for much of this information.
