Triangle home sales continued their upward swing in the first quarter, increasing 20 percent over the same period last year.
Although some increase was expected given the poor market conditions early last year, the market continued to show signs of recovering. Pending sales were up 22 percent and showings increased 11 percent, Triangle Multiple Listing Services data show.
The 6,713 showings in March were the most recorded in a single month since April 2010.
After several years of having sales levels fluctuate widely because of the influence of the federal tax credits, the market appears to be settling into a new normal, said Stacey Anfindsen, a Cary appraiser who analyzes MLS data for area real estate agents.
He said the biggest issue going forward is what happens with the inventory of homes on the market. The Triangle now has an 8-month supply of housing at the current pace of sales, down from a 13-month supply a year ago.
With new home construction unlikely to pick up substantially this year, Anfindsen is watching to see whether a wave of existing homes and foreclosures come on the market in the coming months.
There is concern that the region could see many more foreclosures come on the market this year, in part because of the recent $26 billion mortgage settlement. Many loan servicers slowed or halted foreclosure activities while they awaited a settlement over their handling of loan documents.
But financially distressed listings accounted for 9 percent of all listings at the end of the quarter, up just slightly from 8 percent a year ago.
Thus far the dramatic decline in inventory over the past year has not reduced the average time it takes to sell a house. The average days on the market of the homes that sold in March was 132 days, or six days more than the same period in 2011.
That is partially a reflection of widespread uncertainty about where home prices are headed.
“It’s still very much a buyer’s market,” Anfindsen said. “An (existing) house has to have everything that a new home would have and if it doesn’t it will sit.”
John Wood, a Re/Max United agent in Cary, said he personally had best first quarter in four years.
“We’re seeing more multiple offers,” he said. “But I won’t say that prices are headed upward yet.”
Indeed, by most measurements housing prices in the Triangle as a whole continue to fall, although the situation tends to vary from neighborhood to neighborhood.
The average sales price of the homes that sold in the first quarter was $223,800, down 2 percent from a year ago. The average sales price of existing homes was $210,700, down 1 percent.
The two metropolitan areas in the region, Durham-Chapel Hill and Raleigh-Cary, have seen 11 consecutive quarters of housing price declines, according to the Housing Price Index published by the Federal Housing Finance Agency. The HPI is based on average price changes in repeat sales or refinancings on the same properties.
Wood said price stabilization will come, it will just take time.
“Your first stage of recovery is getting the units up and inventory down,” he said.