Homebuilders in Charlotte, North Carolina, are struggling to keep up. Not only is there an incredibly tight supply of existing homes for sale, but more buyers are choosing the amenities that new construction offers.
"Our new home construction sales are stronger than they have ever been since I have been in the real estate market," said Bonnie Papandrea, an agent with Wilkinson ERA Real Estate in Charlotte. "The buyer wants the open-floor plan, big island in the kitchen, high-energy efficiency and very low maintenance with a private yard. Everyone is working more and want more time to enjoy what time they have off."
High demand has actually caused delays in closings, as builders are unable to deliver in time. While the wait may be frustrating, shopping for an existing home in the market is getting even more so. The inventory in July was 22 percent lower than a year ago, according to the listing service CarolinaMLS, even as new listings increased 6 percent.
Homes are just selling much more quickly. Sales in July were 17 percent higher than one year ago, and days on market, the time from listing to contract, fell from 69 to 59 days. Tight supply pushed the median home price to $202,500, up 5.5 percent from a year ago, according to CarolinaMLS. The rate of price increases has slowed somewhat, but buyers are still getting sticker shock.
Higher prices have not pushed more sellers into the market, however. Despite the increases, Charlotte sales were very strong at the height of the housing boom in 2006, and as a result, a lot of homeowners are still either underwater on their mortgages or don't have enough equity to afford a move up.
"I also do believe that we still have some skeptical sellers. Most sellers are more informed to the home market value of their property, and even though the market is going up they are waiting for the right time and the right price," Papandrea said.
Tight supply and higher home prices are fueling a new rental market in Charlotte. As more apartments go up, they fill up, and supply is not keeping up with demand. Some renters are just waiting for the right buying opportunity to come along, while others are waiting for their paychecks to catch up with their plans for home ownership.