REALTORS® around the lake agree that 2023 is a challenging year for real estate. The shortage of listings continues as buyers wait eagerly to buy lake property. We have experienced inflated pricing, multiple offers, and waterfront homes selling for over asking prices. Compared to last year, we see a lack of available waterfront home inventory has slowed sales. A lack of quality lots for sales caused our sales numbers to drop.
In the first nine months of 2023 we have sold 129 waterfront homes, averaging $840,244 each totaling $114,841,506. The average price is up 3.89% of the average sale price for the same time in 2022. The median sold price of waterfront homes in 2023 is $770,000 compared to $750,000 in the same nine months of 2022, totaling an increase of 2.67%. The total dollar sales of waterfront homes are down 14.46% in the first nine months of 2023 compared to the same time in 2022.
Offshore home sales this year total $16,464,649 compared to $24,872,280 in the first nine months of 2022 in dollar sales, a decrease of 33.80%. The average offshore homes sold for $219,529 compared to $220,809 in 2022 during the same time, a decrease of 0.58%.
Waterfront lot sales are down 17.19% in unit sales with 53 sold in 2023 and up 13.15% in dollars sales compared to 2022 sales for the first nine months. The average waterfront lot has sold for $275,403 this year. Offshore lot sales are down 19.73% in dollar sales in the first nine months of 2023 compared to 2022.
Our total market, homes and lot dollar sales in the first nine months of this year total $152,151,205, a decrease 14.65% of the same time in 2022.
All figures are from the Roanoke Valley Lake Gaston Board or REALTORS Multiple Listing Service and do not reflect private sales.
The major contributor to the decrease in sales of waterfront homes is supply. In the first nine months of 2023, we had 125 new listings for waterfront homes compared to 259 for the same time in 2020, pre-pandemic.
The rise in interest rates has certainly contributed to the decrease as well. Currently the mortgage rate for primary homes is just under 8% and second-homes is just under 9%.
Pending home sales across the country decreased 7.1% in August, according to the National Association of REALTORS®. "Mortgage rates have been rising above 7% since August, which has diminished the pool of home buyers," said Lawrence Yun, NAR chief economist. "Some would-be home buyers are taking a pause and readjusting their expectations about the location and type of home to better fit their budgets." "Moreover, the government shutdown will disrupt some home sales in the short run due to the lack of flood insurance or delays in government-backed mortgage issuance," said Yun.
“Consumer confidence fell again in September 2023, marking two consecutive months of decline,” said Dana Peterson, Chief Economist at The Conference Board. Responses showed that consumers continued to be preoccupied with rising prices in general, and for groceries and gasoline in particular. Consumers also expressed concerns about the political situation and higher interest rates. The decline in consumer confidence was evident across all age groups, and notably among consumers with household incomes of $50,000 or more.” The current situations with the lack of Speaker in the House, the wars in Israel & Ukraine, inflation, rate hikes, labor strikes, etc. are all contributing to the decrease in Consumer Confidence.
Many Economists predict a recession to some degree in 2024, citing higher bond yields and consumers draining their savings accounts because of inflation and rising cost of living as signs. Bloomberg Economics noted these reasons too, the start back of student loan payments, the increased use of AI and the possibility of a severe commercial real estate crash.
We are seeing the real estate market cooling down slightly here at the lake. If you have been thinking about putting your Lake Gaston property on the market now is a great time before interest rates increase more and the economy continues to slow. We have buyers waiting for that right property to come available. To find a buyer you need to price your property competitively in our currently changing market. Give me a call or send me an email, I’ll be happy to give you my opinion of the value.
In the first six months of 2023 our total closed sales, land and homes have totaled $104,077,151 down from $118,656,746 the same period of 2022 or a decrease of 12.29%. Closed sales on waterfront homes were down 10.48% in dollar sales in the first six months of 2023 over the same period last year. We have closed 88 waterfront homes this year compared to 112 last year. The average sold price of waterfront homes in 2023 is $907,620 up 13.94% over the same period in 2022. The median price of waterfront homes sold in 2023 was $762,500, up from $727,500 last year or a 4.81% increase. The increase in the median home’s sales price is from home prices increasing and sales of higher priced homes. Today, we show 25 waterfront homes sold on the lake for $1M or more this year. Compared to the same time period for 2022 when twenty-two sold. Going back to the same time period in 2019 only one waterfront home sold before Covid hit. Covid has been a major contributor to increasing real estate prices everywhere.
This year, 50 offshore homes have sold, and their total dollar sales are down 41.6% this year compared to last year. Waterfront lot sales are up 10.23% in dollar sales compared to last year.
All sales numbers are from the Roanoke Valley Lake Gaston Board of REALTORS® MLS and do not reflect private sales.
Second home prices have surged. Mortgage rates climbed to today’s rate of 7.12% for primary homes and 7.75% for second homes/ investment properties. Since the beginning of 2022, mortgage payments have become increasingly unaffordable. Second-home buyers face those increases plus the federal government increased loan fees for second homes last year. Example, if you buy a median priced home on Lake Gaston with 20% down payment, you’d have a monthly payment of $1,798 over 30 years because of the increased interest rate.
Total existing-home sales transactions that include single-family homes, townhomes, condominiums and co-ops, rose 0.2% from April to a seasonally adjusted annual rate of 4.30 million in May. Year-over-year, sales dropped 20.4% from May 2022.
"Mortgage rates heavily influence the direction of home sales," said NAR Chief Economist Lawrence Yun. "Relatively steady rates have led to several consecutive months of consistent home sales."
“The Leading Economic Index provides an early indication of significant turning points in the business cycle and where the economy is heading in the near term. The Conference Board Leading Economic Index® (LEI) for the U.S. declined by 0.7 percent in May 2023 to 106.7, following a decline of 0.6 percent in April. The LEI is down 4.3 percent over the six-month period between November 2022 and May 2023—a steeper rate of decline than its 3.8 percent contraction over the previous six months from May to November 2022. The US LEI continues to signal a recession within the next 12 months.”
Our inventory of quality homes in the Lake Gaston market continues to be low. Now is a good time to list your home if you have been thinking of selling. List your home before the market cools off more. Contact a full-time REALTOR® with working knowledge of the Lake Gaston market. Ask them to provide written data on properties sold and listed in the local market. When listing your property, price it according to comparable ones on the market. Remember, buyers’ frown at time wasted looking at overpriced properties. Overpriced properties sit on the market and become stale. Eventually selling at a lower price because of the wrong listing price at the start.
More people are coming to Lake Gaston and the surrounding locations. We see growth in both residential and commercial development. Lake Gaston REALTORS® love helping people find their dream home or business at the lake!
Barney Watson is the owner of Lake Gaston Real Estate LLC and he is Director for the Roanoke Valley Lake Gaston Board of REALTORS®. His cell is 252-532-3274 and his website is www.lakegastonrealestate.com.
In the first three months of 2023 our total closed sales, land and homes, have totaled $42,627,390, a decrease of 21.3%, compared to the $54,150,816 over the same three months of 2022. This year, our first quarter closed sales on waterfront homes are down 22.2% (in dollar sales), compared to the same period last year. We have closed 34 this year compared to 52 last year. The average sold price of waterfront homes in 2023 was $957,776, an increase of 19% over the same period in 2022. The median sold price of waterfront homes for the first three months was $741,445 compared to $727,500 in 2022, an increase of 1.9%. The median days on the market for waterfront homes for the first quarter was 7. The average sold price of offshore homes for the first quarter of 2023 was $205,889 versus $243,015 for the same period last year, a decrease of 53.8%. We closed on 18 offshore homes this year. Waterfront lot sales (in dollars) were down 25.2% from last year. All sales numbers are from the Roanoke Valley Lake Gaston Board of REALTORS® Multiple Listing Service and do not reflect private sales.
Across the country, The National Association of REALTORS® (NAR) reports: “Total existing-home sales, completed transactions that include single-family homes, townhomes, condominiums, and co-ops, sank 2.4% from February to a seasonally adjusted annual rate of 4.44 million in March. Year-over-year, sales decreased 22% (5.69 million in March 2022).”
"Home sales are trying to recover and are highly sensitive to changes in mortgage rates," said NAR Chief Economist Lawrence Yun. "Yet, at the same time, multiple offers on starter homes are quite common, implying more supply is needed to fully satisfy demand. It's a unique housing market."
Our inventory of quality homes in the Lake Gaston market continues to be at record lows, especially those waterfront homes priced below $1M.
The Consumer Confidence Index® fell in April to 101.3, down from 104.0 in March. “While consumers’ relatively favorable assessment of the current business environment improved somewhat in April, their expectations fell and remain below the level which often signals a recession looming in the short-term,” said Ataman Ozyildirim, Senior Director, Economics at The Conference Board. “Consumers became more pessimistic about the outlook for both business conditions and labor markets. Compared to last month, fewer households expect business conditions to improve and more expect worsening of conditions in the next six months. They also expect fewer jobs to be available over the short term.”
Mortgage rates have been decreasing slightly over the past month or so. The 30-year fixed rate for a primary residence is 6.799% (APR) and 7.476% for a second home. These rates strongly depend on your FICO score and down payment amount. Additional loan fees are also higher for a second home than a primary home.
And now we have the Biden Administration’s new ruling for mortgage loans that begins May 1, 2023. Newsweek reported, “Homebuyers with good credit scores will soon be facing higher mortgage fees as the Biden administration seeks to close the racial homeownership gap and get more first-time and low-income buyers through the door. A new federal rule could raise the monthly mortgage payments of buyers with good credit scores by over $60 a month, while riskier borrowers will get more favorable terms because their fees will be reduced.”
If you’ve been thinking of selling your Lake Gaston property, wait no longer! The shortage of inventory has persuaded some potential buyers to buy their lake homes sooner. A full-time REALTOR®, who provides written data and gives you the correct value of your home, is important.
The real estate market at Lake Gaston went through many changes in 2022 as did most of the country. The first half of the year experienced multiple offers and waterfront homes selling for more than asking price. The second half of the year, with rising interest rates, we saw fewer buyers. Many buyers have been priced out of the second home market. We still have the scarcity of listings for new homes, but many buyers are taking a wait and see approach.
At year-end Lake Gaston Realtors sold 206 waterfront home transactions closed, averaging $813,892 each. Totaling $167,661,725 or a decrease of 9.21 percent in dollar sales over 2021 sales. Our average waterfront home listing price was $817,334 at time of contract. The average selling price was 99.5 percent of the asking price in 2022 versus 100.7 percent in 2021. Unit sales of waterfront homes was down 24.0 percent from 2021, because of lack of inventory and rising interest rates. Offshore homes showed an increase of 32.9 percent over 2021 sales with 146 closed, averaging $209,886 each, totaling $30,640,480. Waterfront lot sales were down with 76 sold, compared to 137 last year, averaging $194,163 each, totaling $14,756,370, that’s down 42.0 percent. Offshore lot sales improved with an increase of 9.8 percent from 2021 levels averaging $22,525 each. Total homes and land (lots), for firms all around the lake, closed 571 transactions compared to 668 in 2021. Totaling $220,712,074 compared to a dollar amount of $244,868,702, a decrease of 9.87 percent above the same period in 2021. Sales numbers are from the Roanoke Valley Lake Gaston Board of REALTORS® Multiple Listing Service (MLS) and do not include private sales.
The median sales price for waterfront homes in 2022 was $756,000, a 25.37 percent increase in sales price over 2021. The median price for offshore homes was $198,000, an increase of 13.86% in sales price over 2021. The median price of waterfront lots decreased 9.1 percent as compared to 2021 levels.
The Conference Board Consumer Confidence Index® increased in December following back-to-back monthly declines. The Index now stands at 108.3, up sharply from 101.4 in November. “Consumer confidence bounced back in December, reversing consecutive declines in October and November to reach its highest level since April 2022,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. Inflation expectations retreated in December to their lowest level since September 2021, with recent declines in gas prices a major impetus. Vacation intentions improved but plans to purchase homes and big-ticket appliances cooled further. This shift in consumers’ preference from big-ticket items to services will continue in 2023, as will headwinds from inflation and interest rate hikes.”
The National Association of REALTORS® reports existing-home sales fell for the eleventh consecutive month in December. Total existing-home sales completed transactions that include single-family homes, townhomes, condominiums and co-ops – decreased 1.5% from November. Year-over-year, sales sagged 34.0%.
“December was another difficult month for buyers, who continue to face limited inventory and high mortgage rates,” said NAR Chief Economist Lawrence Yun. “However, expect sales to pick up again soon since mortgage rates have markedly declined after peaking late last year.”
“While 2022 may be remembered as a year of housing volatility, 2023 likely will become a year of long-lost normalcy returning to the market, economists predicted Tuesday during the National Association of REALTORS®’ annual Real Estate Forecast Summit. Next year, mortgage rates are expected to stabilize while home sales and prices moderate after recent highs, according to NAR’s forecast. However, the details could be different from region to region.”
“Some housing markets may see an uptick in homebuying activity at the beginning of the year, especially if mortgage rates continue receding from a recent high of 7%. Housing inventory is expected to remain tight in 2023, with housing starts below historical averages and fewer homeowners willing to sell, said NAR Chief Economist Lawrence Yun. The ongoing housing supply challenges will prevent home prices from falling, though price appreciation will slow, he added. “I see many hopeful signs for early next year,” Yun said.”
“But first, the market has to close out 2022, a year when inflation soared to a 40-year high and rapidly rising mortgage rates put the brakes on what had been a pandemic-era homebuying frenzy.”
Mortgage interest rates remain high, 6.35 percent for a 30-year fixed rate mortgage on a primary home and 6.9 percent for a secondary home. The Fed has also imposed a fee for second home mortgages of 1.25 to 4.0 percent of the loan amount. The 30-year mortgage interest rate a year ago was 3.5 percent.
Available waterfront home inventory remains at an all-time low. In 2022 we had 192 new waterfront home listings become available compared to 262 in 2021, a 26.7 percent decline. But, in 2022 we sold 206 waterfront homes compared to 271 in 2021. The waterfront homes sold in 2022 priced below $600,000 was 67, priced between $601,000 and $1M were 97 and $1M plus was 42. Compare this to 2019, our last “normal year”, sales of waterfront homes priced below $600,000 was 228, priced between $601,000 and $1M was 47 and $1M plus was 4. Again, the increase is because of the lack of available listings, driving prices up and an increase in high-net-worth buyers.
Have you been thinking about selling your home? There are potential buyers looking for waterfront homes, priced right and in good condition. Do not miss a great time to sell. The shortage of inventory will likely result in a faster sale at a premium price. “Spruce up” your home and get it listed right away! A full-time REALTOR®, who provides written data such as this and prices your home correctly, is essential.
REALTORS® around the lake agree that 2022 is a challenging year for real estate. The shortage of listings continues as buyers wait eagerly to buy lake property. We have experienced inflated pricing, multiple offers, and waterfront homes selling for over asking prices. When compared to last year this time, we see a lack of available waterfront home inventory has slowed sales. Lot sales have also decreased dramatically as quality lots are also in short supply.
In the first nine months of 2022 we have sold 162 waterfront homes, averaging $808,464 each totaling $130,971,126. The average price is up 19.27% of the average sale price for the same time period in 2021. Resulting from a combination of inflated prices, because of inventory constraints, and the increased sale of larger, more expensive homes. The median sold price of waterfront homes in 2022 is $742,500 compared to $600,000 in the same nine months of 2021, totaling an increase of 23.75%. The total dollars sales of waterfront homes is down 4.82% in the first nine months of 2022 compared to the same time period of 2021.
Offshore home sales this year total $24,872,280 compared to $17,477,220 in the first nine months of 2021. Totaling an increase of 42.31%. The average offshore homes sold for $220,169 compared to $183,971 in 2021 during the same time period. Resulting in an increase of 19.68%.
Waterfront lot sales are down 43.75% in unit sales with 63 sold in 2022 and down 38.63% in dollars sales compared to 2021 sales for the first nine months. The average waterfront lot has sold for $204,436 this year. Unit sales of offshore lots totaled 89 at the end of September and that was the total at year-end 2021.
Out total market, homes and lot dollar sales in the first nine months of this year total $174,758,729, a decrease 2.16% of the same time period in 2021.
All figures are from the Roanoke Valley Lake Gaston Board or REALTORS Multiple Listing Service and do not reflect private sales.
The 30-year mortgage rate today is 3.35%, up almost a full point since last year this time. The rates are still low, I hope this will not hinder sales here at the lake.
The Consumer Confidence Index® declined again in September, following decreases in both July and August. The Index stands at 109.3, down from 115.2 in August.
The Consumer Confidence Index® increased in September for the second consecutive month. The Index stands at 108.0, up from 103.6 in August. “Consumer confidence improved in September for the second consecutive month supported in particular by jobs, wages, and declining gas prices,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. Concerns about inflation dissipated further in September—prompted largely by declining prices at the gas pump—and are now at their lowest level since the start of the year.” “Meanwhile, purchasing intentions were mixed, with intentions to buy automobiles and big-ticket appliances up, while home purchasing intentions fell. The latter no doubt reflects rising mortgage rates and a cooling housing market. Looking ahead, the improvement in confidence may bode well for consumer spending in the final months of 2022, but inflation and interest-rate hikes remain strong headwinds to growth in the short term.”
Existing-home sales decreased slightly in August, marking the seventh consecutive month of declines, according to the National Association of REALTORS® (NAR). Total existing-home sales, were down 0.4% from July, year-over-year, sales faded by 19.9%
Pending home sales also decreased for the third straight month in August, according to the NAR. The Pending Home Sales, a forward-looking indicator of home sales based on contract signings, fell 2.0% in August. Year-over-year, pending transactions are down by 24.2%.
"The direction of mortgage rates – upward or downward – is the prime mover for home buying, and decade-high rates have deeply cut into contract signings," said NAR Chief Economist Lawrence Yun. "If mortgage rates moderate and the economy continues adding jobs, then home buying should also stabilize."
Yun expects the economy will remain sluggish throughout the remainder of this year, with mortgage rates rising to close to 7% in the coming months. "Only when inflation calms down will we see mortgage rates begin to steady," said Yun. As a result of the current interest rate environment and weaker economic activity, NAR expects existing-home sales to decline 15.2% in 2022, while new home sales are projected to fall by 20.9%.
Interest rates at the time of writing were 6.6% for a 30-year mortgage on a primary home and 8.375% for a second-home.
In the first nine months of 2022 we have seen 163 new listings on waterfront homes. Compare that to 196 the same time period of 2021. This number also points to our inventory shortage.
We are seeing the real estate market cooling down here at the lake. If you have been thinking about putting your Lake Gaston property on the market now is a great time before interest rates increase more and the economy continues to slow. We have buyers waiting for that right property to come available. To find a buyer you need to price your property competitively in our currently changing market. Give me a call or send me an email, I’ll be happy to give you my opinion of value.