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A construction magazine has picked the Wilmington market as having the 16th healthiest building market in the country.
Quote:
Hanley Wood’s Builder magazine found that while the Port City’s sputtering economy might not look good to locals, it’s relatively inexpensive housing costs and proximity to the coast was attractive to outsiders.
Wow. They can't be serious. This area is flooded with existing new construction homes, townhomes and condominiums and with declining property values it is much cheaper to buy an existing home than build a new one. Nobody in their right mind would build in this market. I think their might be a little bias in that article.
Thank you CarolinaAppraiser for saying that. It would just sound like sour grapes if I said it. And the peak median price of $221K in the year 2006 the article claims sounds suspiciously low. As memory serves it was about that time when Wilmington was the most expensive housing market in North Carolina.
There are SO many homes on the market- both existing and stagnate new builds- at so many price points (and so many sellers willing to negotiate more than maybe they used to), I just can't see the logic in building unless you're just of the 'I have to have a NEW house' mentality.
Thank you CarolinaAppraiser for saying that. It would just sound like sour grapes if I said it. And the peak median price of $221K in the year 2006 the article claims sounds suspiciously low. As memory serves it was about that time when Wilmington was the most expensive housing market in North Carolina.
Bill, I just checked the MLS and our current median home price is $264k so yes that $221k figure was way off. In 2006 we were probably closer to $290k.
Bill, I just checked the MLS and our current median home price is $264k so yes that $221k figure was way off. In 2006 we were probably closer to $290k.
i did not realize that the MLS collected data about median home prices. where do you find that?
i have heard of median sales prices, (here, just click on the 'statistics' tab on the bottom), which would be different than median home prices (all homes, not just those that sold). The numbers from the Wilmington MLS show that current median sales price is $158,500 (Jan 2011), and the peak median sales price was $233,400 (Nov 2006).
I simply go into the MLS, enter the search criteria and click "reports", select the report type I wish to generate and hit enter. Fannie Mae now requires a marketing conditions report in all appraisals which contains both median listing and sales prices over a 12 month time period. That's where I got the median home prices for Wilmington. That information is not available to the public though. You have to be a member of the MLS to get it.
That figure of $158,500 for January 2011 is accurate but it includes all single family properties. Homes, condos, manufactured housing, modular homes, ect. The statistic I quoted was for site built homes only since the other stuff wasn't relevant to the conversation concerning builders.
That was a pretty good article. If I had to describe the local real estate market in just a few sentences it would be this. Things are not good but they aren't as bad as they have been. I think we are very close to the bottom of the market. Home prices are reasonable and there are a lot of deals to be had on foreclosure and short sale homes and great deals to be had on vacant lots and land. The problem right now is that the economy is generally not so good and mortgage lending is too restrictive. Until those two things change I don't see a substantial recovery in the housing market. Just my opinion though. I have been wrong before.
And under no circumstances would I build a home right now. Existing inventory is just too cheap to justify it.
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Location: Greenville, NC
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Quote:
Originally Posted by CarolinaAppraiser
The problem right now is that the economy is generally not so good and mortgage lending is too restrictive. Until those two things change I don't see a substantial recovery in the housing market.
You need restrictive mortgage lending to repair the markets. Only those that are considered good risks should be allowed to borrow such huge sums of money. Yes it is painful right now. But if they keep the standards high you will end up with a housing market with few foreclosures and is much stronger overall.
If they had kept the standards high to begin with the housing crash would never have occurred. Stick to 28/36 and everything will be fine. ARM's should be eliminated. Although they are low now they will be rising in the future.
One of the reasons Bernanke holds the rates where they are now is the massive impact that raising rates would have on state and local budgets. With huge budget deficits around the nation (NC's is something like $3.6B) many, many governments have to borrow increasing amounts of money to pay their bills. Right now there are only a relative few municipal defaults and bankruptcies occurring. Try to imagine what would happen if bond rates suddenly rose right now by 2 or 3 points. Many governments that are only holding on by their finger tips would loose their grip.
He will raise the rates but only when a certain type of inflation starts to occur. Everybody these days is wondering just how much inflation there needs to be before Bernanke will raise the rates. Well the inflation he's looking for just hasn't occurred.
Bernanke is looking for inflation in money or the general supply of money in the economy. Although it's well known that the Fed has been "printing" money that money is not making it's way into the economy. Up until 2008 there was plenty of money in the economy. The Fed was slowly raising rates (not fast enough as it turned out). Everybody had access to easy money from the banks.
Then the crash occurred and the banks pulled back big time. Unemployment soared, it's actually much higher than the headline U-3 rate. People stopped spending and the supply of money in the economy contracted. And that is still where we are today. There has been a slight improvement but not nearly enough to become concerned about there being too much easy money.
You get stuck between a rock and a hard place with interest rates. If you raise them right now to combat price inflation you kill money supply. If you keep them low to increase the money supply then you have to fight price inflation.
The point is the longer the rates are held low the higher they will climb when the Fed finally does raise them. That will kill anybody stupid enough to get an ARM. Most people have no business with an ARM. It is gambling with what will be the largest asset that most people will ever have.
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