A Signal for Strength in Charlotte Market

August 4, 2008
Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte, NC

Charlotte homebuilders cutting back
New-home starts drop, but that's good trend for a market full of unsold houses and foreclosures.
The latest local housing market stats confirm the slump continues, but they also show the week's second positive trend.
Charlotte-area homebuilders started 49 percent fewer homes during the second quarter, compared with the same period in 2007, according to data released Friday by Metrostudy. The 3,011 new home starts marked the second consecutive quarter below 4,000, a level last seen in 2003.
Metrostudy, a Houston firm, compiles data on the Charlotte market and others nationwide. Crews visit building sites and tally vacant lots, homes under construction and homes completed. Metrostudy counts houses as sold only when its crews see evidence of people living in the homes.
The firm's method differs from those that compile building permit and sales data from public records. Results of the two methods tend to track fairly closely.
New-home closings fell nearly 40 percent in the second quarter but exceeded the number of houses started, according to Metrostudy research. That's important because it means builders are cutting back in response to weak demand rather than adding to a market glutted with foreclosures and other houses awaiting buyers.
That's a welcome shift from the last two quarters, when area builders started more houses than they sold, said Bill Miley, Metrostudy's Charlotte manager.
“Charlotte's new housing market is in a correction phase,” he said.
Earlier this week, a popular index showed Charlotte area home prices dipped slightly over the last year. But May was the third month in a row during which prices inched up compared with the previous month, according to the S&P/Case-Shiller Home Price Index. That could signal strengthening in the market.

Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte, NC