Triangle home sales rose 10 percent in May compared with the same period a year ago, as a lack of inventory at the lower end of the market continues to drive prices higher.
The average price of the homes that sold last month was $270,000, a 4 percent increase over May 2015 and 18 percent higher than the same period four years ago, Triangle Multiple Listing Services data show.
But steady price appreciation amid strong demand has still not enticed more people to put their homes on the market. While home sales in May were 60 percent higher than they were four years ago, inventory levels over that period plummeted 41 percent.
“Even though we’ve had price increases across the board there’s still a shortage of re-sale product out there,” said Stacey Anfindsen, a Cary appraiser who analyzes MLS data.
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He said most of the inventory growth in the Triangle is new construction, much of which has been pre-sold. The number of new listings in May was the most since 2010, but new re-sale listings during the month were down 4 percent compared to the same period a year ago.
Van Fletcher, a real estate agent with Allen Tate, said many homeowners are choosing to stay put because of uncertainty about their ability to find their next house.
“You may get what you want on the sale side but you’ll pay what somebody wants on the buy side,” he said.
Homes that are in good shape and in good locations continue to attract multiple offers and sell quickly. The average days on the market of the homes that sold in May was 42 days, down from 51 days a year ago.
“It’s insane,” said Fletcher, who has sold or put under contract 48 homes this year. “Every single one that I’ve put under contract, whether I represent the buyer or seller, is a multiple offer.”
Seventy-two percent of the re-sale houses listed in May sold within 30 days, and 22 percent sold for over their list price.
The inventory shortage is particularly acute for homes priced under $300,000, as rising land costs have made it difficult for homebuilders to offer new product priced in that range.
Anfindsen said the Triangle remains very much a bifurcated market. While demand is far outstripping supply at lower price points, it’s a different story at the upper end of the market.
Sellers above $500,000 in many areas of the Triangle are having a much harder time selling their home.
Anfindsen said a wave of new construction in the Falls Lake area is expected to make it even more challenging.
“The re-sale market for $700,000 to $800,000 and above is going to get worse in the next six months to a year because there’s really nothing they can do to compete with new construction but lower the price,” he said.