The April real estate market stats for the Outer Banks are out. The story these numbers tell is a repeating theme: Hot sales, cold inventory.
On May 7th the Outer Banks Association of Realtors released the April MLS Statistical Report. Total monthly sales are up 136%, yearly sales up 94% Residential sales are up 119%, lot/land sales up 252%. That certainly sounds hot, and it is.
However, we are comparing this April to April 2020 when business slowed dramatically due to the uncertainty of the marketplace. The OBAR report from one year ago stated total month-to-month sales were down 23%. Properties under contract were down 19%. I’m not saying our current market isn’t hot, just that certain month-to-month statistics are a bit inflated due to the rapid slowdown we experienced for a few months last year.
The same is true on a national basis, reflected in single-family sales and purchase applications. So, yes, sales are still hot even though certain stats are a bit inflated.
OBX inventory
Inventory is ice cold. That is a statistic we began to take note of last year and it has not improved. April 2020 residential inventory was down 21% This April residential inventory is down 70% compared to last year, 74% compared to 2019. Lot/land inventory is down 24%, total inventory is down 52%.
“Days on market” is down 45% to 53 days. “Median days on market”, which I think is a better indicator of how quickly things are moving, was 7 days for April. Prime properties priced correctly in all price ranges are still going under contract quickly; 58 were under contract in two days or less. 173 Were under contract in a week or less.
Back to inventory; So when will we begin to see an increase of inventory on the market? Pulsenomics asked that question to a group of economists, 43% who said they expected an inventory increase in the second half of this year. 26% said not until the first half of 2022, and 9% said 2023 or later.
This is why if you are planning on selling your home now is the peak time to get it done. More inventory will reduce your bargaining position and the dollar amount you can get for your home
Are we in a bubble?
People are talking about “the bubble”. I could devote another article to this subject. But in short, Lawrence Yun of the National Association of REALTORS states “this is not a bubble, this is simply lack of inventory.
Sam Khater, the Vice President, Chief Economist of and head of Freddie Mac’s Economic and Housing Research division says “the main driver of the housing shortfall has been the long-term decline in the construction of single-family homes”. The graph below shows the number of new construction homes over the last 50 years. During the last 13 years, the average number of new homes completed is below the 50-year average. This is not a bubble, it is a lack of inventory.
April stats by area
Now a look at the sales stats for the individual areas. Keep in mind what I said earlier about the inflated monthly sales figures. For the month of April;
- Corolla – Sales up 183% – Median Sales Price up 18% to $660,000.
- Duck – Sales up 122% – Median Sales Price up 9% to $567,400.
- Southern Shores – Sales up 60% – Median Sales Price up 19% to $605,000.
- Kitty Hawk – Sales up 20% – Median Sales Price up 21% to $477,000.
- Colington – Sales up 114% – Median Sales Price up 14% to $340,000.
- Kill Devil Hills – Sales up 86% – Median Sales Price up 14% to $375,000.
- Nags Head – Sales up 185% – Median Sales Price up 16% to $558,500.
- All Hatteras – Sales up 168% – Median Sales Price up 29% to $485,000.
- Roanoke Island – Sales up 67% – Median Sales Price up 18% to $419,000.
- Currituck Mainland – Sales up 47%, Median Sales Price up 12% to $308,740.
- Ocracoke – Sales up 200% (from 1 unit to 3) – Median Sales Price up 10% to $390,000.
Information in this article is based on information from the Outer Banks Association of REALTORS® MLS for the period January 1, 2020, through May 7th, 2021.
Mike is a long-time “Outer Banker”, both as a vacationer and a full-time resident. You may also know him as “Moose”, his nickname since he was 15 years old, and his on-air radio name for decades in Raleigh, Greensboro/Winston-Salem, Norfolk, and formerly on Beach 104 every morning on the “Moose & Jody Show” for over 14 years. Michael has built successful businesses on the Outer Banks. He is active in the community as well as a founding board member of “Outer Banks Forever”, Past President of “The First Flight Society”, a founding member of “The Outer Banks Bicycle & Pedestrian Coalition”, and Past President and current member of “First Flight Rotary. Moose shares your love of the Outer Banks and understands the uniqueness of the area. Learn more at mooseobx.com