January 2025 Update
January 22, 2025 By Ilona
2024 market saw a few distinct changes. Higher inventory and massive price reductions. We are already starting to see a small change in pricing – roughly 5 – 7% depending on location. If inventory keeps rising, we could see the pricing change go up.
Here’s how December Year over Year looks:
|
December 2024 |
December 2025 |
|
| Active – 585 | Active – 434 | *Single Family |
| U/C – 244 | U/C – 235 | *All Classes |
| Absorption Rate – 6.59 | Absorption Rate – 4.89 |
As you can see inventory is up 35%.
Yet the number of properties under contract is about the same. While that number has not gone down, what happens when you have more homes for sale and the same or fewer buyers? Law of supply and demand is in play. That is why the absorption rate (months of inventory) has gone up so much.
The statistics are telling us the slow down will continue this year. With mortgage rates higher and mortgage applications at their lowest levels ever, we could see a double-digit drop in pricing this year. I’ll be watching!
How NOT to set the listing price of your home.
March 7, 2024 By Ilona
A lot of agents will do presentations on how they came up with a price for your home. It is a task that does require some skill. The challenge of course is getting the seller to agree to the pricing suggestions.
Many sellers come into the meeting with a general idea of what they want for the home, which is helpful. However, here are a few ideas on what NOT to do when you decide to sell your Outer Banks home in today’s market.
- Tax Assessment – Don’t confuse your county tax assessment with market value. Your tax assessment is for the purpose of assessing a tax amount to you for the purpose of revenue to the county. It doesn’t in any way suggest that’s what a buyer is willing to pay or a seller is willing to sell for. Most importantly the assessment on your home right now is 4 years old! On the Outer Banks they only re-assess every 8 years. Because it’s 4 years old, it also doesn’t take into consideration any improvements that have been done since the last assessment.
- Old Appraisal – Appraisals are only good for the day they are written. What? Yes, that’s correct. Considering that anything and everything could change tomorrow, an appraisal can only be valid for one day. If you have a year-old appraisal and want to base your price on some reflection of that, you might find yourself the highest bidder of your home. I mean I was a size 8 years ago, but that’s not exactly going in my dating profile for today!
- Old Sales in the area – All agents have heard it… “Well, my neighbor sold last year for $30,000 more.” Markets never stay the same. It’s an ever-changing environment, which is why consulting with a good agent who studies home prices every day is the best way to get closest to current market value.
- Recent Improvements – We’ve also all heard… “Well I have a new roof, HVAC and carpet. I want to ask $extra to cover those costs.” The fact that you’ve done these “maintenance” items is great. It shows you’ve taken care of the home. The problem is all houses need a roof, HVAC and carpet. In this market, that can make your home more saleable, not necessarily more valuable. Buyers expect the basic components to be in good condition already. What you can ask more for are upgrades. Changing vinyl to tile or carpet to hard wood, or laminate to granite are all upgrades.
- Basing the price on your needs – We would all love to get the seller the most money possible. That’s part of our job. However, we can only sell the home for the true market value. Just because you NEED to get $50,000 at closing doesn’t mean it’s going to happen. You have to consider all the current factors in your marketplace and if those point to a lower price, you needing that money will not cause a buyer to pay it if the value isn’t there. You may need to adjust your plans based on what’s realistically going to come out of the sale of your home. These are hard conversations, but a good agent will not be afraid to spell out the truth.
- Stuck on a previous market value –The last few years have been monumental. It was a fast- rising market and prices skyrocketed. Now we are in a more “normal” market. Prices aren’t rising or falling at a tangible rate just yet. Mostly because inventory is still too low. However, don’t get complacent. Markets ALWAYS cycle. What goes up, must come down. I predict this fall pricing will look differently than it does right now. So, pay attention to CURRENT trends and not what happened the last year or two.
- Focus only on Price – So often I hear, “I don’t have to sell, I’ll just wait if I have to sell at that price.” Selling a home is based on a LOT of decisions, not just the price for it. No one wakes up and turns to their spouse and says “Honey, the house is worth $X, we have to sell it.” Selling is based upon life changes, new needs, maintenance costs, jobs, marriages and so many more things that are related to the way we live our lives. It’s sometimes concerning when I see a seller refuse to sell based solely on the price. That means they are putting that dollar value above the benefits selling the home can bring to the family. Don’t let the emotional response to the price create a “wish I would have” moment.
Now that we’ve covered what NOT to do, if you need help pricing your Outer Banks home for a prime spot in our market today, certainly let me know how I can assist you!
February Market Report
February 9, 2024 By Ilona
With all the insurance and septic news, I’m going to be brief on this month’s market report and just give you the numbers straight up. With only one month in, there isn’t a lot to analyze anyway.
Not much has changed since December, except in Kill Devil Hills showing the only noticeable difference. Which is not unusual for this time of year. We will compare again in April and see if anything changes.
Area Active Now Active Dec
| Area | Active Now | Active Dec |
| Corolla | 81 | 88 |
| Duck | 16 | 17 |
| Sshores | 16 | 17 |
| Kitty Hawk | 15 | 18 |
| KDH | 49 | 60 |
| Nags Head | 43 | 40 |
Not a lot going on just yet, but don’t worry things will heat up in a few weeks! I’ll be watching.
If you’d like more information on buying or selling, please reach out.
For Last 90 days of 2023
October 2, 2023 By Ilona
What to expect? Well, short of some financial event or credit crisis, probably more of the same. The big challenge with resort markets, aka discretionary markets, is the lag time. It generally takes about 18 months for economic factors in the real world to make their way to us.
Because we don’t have a large section of properties that “have to sell” to keep our market moving, as soon as buyers slow down, inventory piles up. At least that’s how it normally is. Truthfully, we are not that far from inventory pushing that market shift from “normal” to “soft.”
That being said, right now here are the main highlights of our current market for Single Family Homes.
Corolla, Duck, Southern Shores |
KDH, Kitty Hawk, Nags Head |
| Active – 110 | Active – 110 |
| Under Contract – 52 | Under Contract – 44 |
| Sold – 274 (30 buyers/month) | Sold – 289 (32 buyers/month) |
| Absorption Rate – 3.6 months | Absorption Rate – 3.4 months |
I double-checkedhose numbers, and it is such a coincidence to have the same active for both north and south markets! They are shockingly similar in all categories.
With 30 buyers a month, 180 active would make it a 6-month absorption rate. That’s only 70 more listings to push us into a soft/declining market. I don’t think it’s unrealistic to suggest we could be there by spring.
Real estate is long term investment. You can time it right, or you can hold and enjoy. If you have questions on what is the best strategy for you, call for an appointment.
August Market Update 2023
August 4, 2023 By Ilona
We are closely watching the main stats on supply (up 33% since January) and demand (down 44% since January). Part of that is watching more specific pockets of activity to glean a closer insight into future trends. One of those trends I’ve noticed in my near 30 year career is that of high-end home sales.
Take a look at the numbers for Duck and Corolla.
Homes sold $2M and over:
2019 – 6
2020 – 26
2021 – 64
2022 – 51
2023 – 17 YTD (Likely on track for 27 total)
-
- Even if we end up at 27 sold, that will be a decline of 47% year over year.
- Number of price reductions to get homes sold is going up; 60% of properties sold are under list price, compared to 51% last year.
- Median days on market for the high-end sales has gone from 21 days to 93 days year over year.
- There are currently 30 homes for sale in Duck and Corolla $2M and over. With basically 2.4 buyers a month this is over a year worth of inventory.
With interest rates rising, insurance costs rising, rents stabilizing to pre-pandemic times, it’s really clear that a shift in pricing has to take place. The timing of this is what’s left to be seen. This strange anomaly of still very low inventory (although is starting to slowly climb) is keeping us stuck in limbo.
If you’re thinking about selling, let’s talk about what your home’s value may look like in this market.
July Market Update
July 3, 2023 By Ilona
Mid-year is upon us and not much has changed since the last report. I did notice an interesting trend regarding CASH in our marketplace. Here’s the deal. There have been 136 home sales in Duck and Corolla since January.
Of those 136 home sales:
- 32 Cash
- 13 Jumbo Loans
- 91 Conventional Loans
A conventional loan amount is $726,200. With the typical 20% down, that means a purchase price of around $875,000.
- Only 53 of the 136 homes sold were under $900,000
- 83 homes sold over $900,000 up to $6,300,000
- 13 were jumbo loans
- 22 were cash
- The average price is $1,251,000
- The median sales price is $992,500
A jumbo loan amount is anything over the $726,200. There were only 13 of those reported. There were 48 Conventional loans in the $900,000 and up price range. This means that 48 buyers out of 83 brought enough cash to the table to get their mortgage at or under $726,200.
To paint a clear picture – 32 cash buyers, 48 mostly cash buyers. That’s 80 buyers (60%) who brought a ton of cash to the closing table to buy a home on the Outer Banks. Including the highest sale of the year so far – $6,300,000 ALL CASH!!!! This just seems amazing to me. (Here’s a link Click Here to View Listings to that home if you want to see what $6.3M gets you)
This is a clear indication that buyers have no problem parking cash in a beach home right now. I mean, why not? Let’s look at the 3 main reasons this could be a good idea.
- Rental income – If you choose to rent, the income will at the very least cover your mortgage. That means, future equity you reap, all paid by SOMEONE ELSE.
- Bank Failures – With banks failing across the country, and the Dodd-Frank Bill legalizing, if not mandating, “bail-ins” a lot of people don’t feel safe keeping their cash susceptible. Rather, they are investing in a tangible asset, and one they can enjoy themselves and have others pay for!
- Inflationary Fiat Dollar – Let’s get real, the price of real estate will NEVER go to zero. As inflation spikes even more and more out of control, the dollar is tumbling closer and closer to zero. It seems buyers are hedging their bets on the tangible asset of real estate versus the tumbling value of the dollar.
We haven’t even begun to see the effects of the commercial real estate crisis looming. This is widely affecting regional banks who are holding the notes on these buildings that are sitting empty in record numbers across major cities.
Don’t get me wrong, my message is not of doom and gloom. What’s going to happen is going to happen. My point is, what is your best move?
If you are considering selling, there are cash buyers waiting for your home. We do have investment vehicles where you can put your money and AVOID capital gains tax in the meantime. Contact me for more information.
If you are thinking about buying, get off the fence and don’t let the interest rates deter you. You won’t have much competition buying right now and there are some great opportunities out there!
November Outer Banks Market Report
November 10, 2015 By Ilona
It’s still 70 degrees here in Corolla today! Almost mid November and it’s very warm. Also SMOKING HOT is real estate market activity! Pending sales are up 56% from last year. That means there are more properties under contract right now than this same time last year.
However, most importantly to note, prices are NOT up. In fact in some markets, like Corolla, they have still declined. Other areas remain virtually unchanged. So we are selling more houses for the same or less money. That’s not a terrible thing, because it means we are stabilizing. That’s a good sign, since it’s a necessary part of a recovery.
Let’s remember, the majority of home sales on the Outer Banks are to buyers who don’t live here. That means it is a discretionary purchase, which will cause our recovery to naturally be slower than those year round markets. This is nothing new. The same thing happened when the real estate market crashed in the late 80’s. It was almost 1999 before things recovered.
Distressed property sales are down 30% from last year. So the truth is those sales are no longer a factor and are certainly not what’s holding back prices. The main issue is STILL supply and demand. We have a whopping 16 months worth of inventory on the market right now.
That means if nothing new came on the market it would take 16 months to sell out what’s currently for sale. A normal market is considered to be a 4 to 6 month supply. Since we are selling more than last year and this “16 months” is the lowest absorption rate we’ve seen in many years, I would say this is another great sign that we are getting close to the end of the stagnant time.
The important thing to remember is, prices won’t immediately start to go up either. Appreciation takes time. So if your home is worth 15% to 20% less than what you would prefer to sell it for in today’s market, you could still be another 6 or more years away from getting your preferred price. And we don’t know what an interest rate hike could do to that time frame either. That kind of increase in value will take time, as it should, or we will only be setting ourselves up for another crash. Which I’m sure, nobody wants to experience again this soon if at all!
That being said, if you want to buy a great house, it may not last long. Especially if the home is priced right. If you want to sell your home, price it aggressively and the buyers will show up!
New Price!! Spend your Lazy Summer Days on Your Sun Deck in Corolla!
July 7, 2015 By Ilona
