Inventory shortage, rising interest rates continue to stall Charlotte housing market this summer

The Charlotte region’s dearth of inventory — along with rising mortgage interest rates — continue to put a damper on what is usually a hot time in the housing market.

After more than a year of annual upticks in housing supply, the local 16-county region in early July saw inventory slide 17.2% year over year. The 4,963 homes for sale as of July 5 represented a decrease of 1,000-plus properties from the same point last year, according to MLS data in the newest Canopy Realtor Association report.

Despite the annual decline, the region’s stock of housing rose slightly from early June, by nearly 300 homes. It marked the highest inventory level of the year since January — when there were nearly 6,500 homes for sale.

The last time local inventory had dropped here on a year-over-year basis was in early June 2022, falling 12.3% to 3,788 homes. The region then had started to slowly build back its housing supply, reaching more than 7,300 homes for sale as of early December.

The nearly 5,000 homes for sale on July 5 left the region with a 1.4-month supply of inventory, keeping a sellers’ market soundly intact.

Potential sellers, however, remained hesitant to enter the market themselves as interest rates hovered in the 6.7% range throughout June. New listings across the region totaled 4,655 in June, down 28.6% over the year and up just 1.9% from May, according to Canopy’s report, released on July 19.

Listing activity year over year has fallen at least 25% each month since April. That lack of activity has further compressed the inventory crunch.

“Sellers still control the market and we can see that, as sellers received nearly all of asking prices for their homes this past month; however, the lack of seller activity reflects sellers unwillingness to take on higher mortgage rates, since listing their homes, means they too become buyers,” said Tiffany Johannes, Canopy president, in the report.

The average local listing price in June increased 3.9% over the year to $498,215, with sellers receiving 98.5% of their original asking price. That measure is at its highest level since last August.

Home-sale prices stayed steady in June. The average sale price rose 2.9% over the year and 0.9% over the month to $487,755. The median sale price of $389,900 represented a 2.5% decrease over the year, but a 1.3% increase from May.

Cornelius and Gastonia saw some of the biggest year-over-year declines in median sales price. Cornelius posted a 12.6% decrease to $480,500, while Gastonia had an 8.9% drop to $255,000. Areas like Tega Cay ($555,375), Lincolnton ($319,950), Matthews ($535,000) and Waxhaw ($754,500), on the other hand, had annual increases of between 11% and 12.3%. Each of those four places saw sharp inventory drops in June.

Local home sales fell 22.1% over the year to total 4,161 in June. That’s up 4.4% from May.

The number of homes to go under contract — an indicator of future sales — was also down in June, falling 6.2% to reach 4,055. Pending sales were down 6.3% from May.

Homes averaged 29 days on the market in June — up from 14 days in the same month last year, but down from 34 days in May.

“Gains in supply, especially existing homes are crucial to our market becoming healthier; tight inventory and the lack of affordability due to increased rates, could impact recruiting for economic development and keep a number of buyers, particularly work-force buyers sidelined, or commuting longer distances,” Johannes said.


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