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North Carolina
The real estate virus from the mortgage mess missed North Carolina for the longest time, and then like a locomotive speeding on a railroad track it struck.
North Carolina is only in the early stages of the national real estate recession with escalating foreclosures, and declining prices in most of its housing markets. It’s been one of the country’s strongest housing markets with appreciation that didn’t get out of whack.
North Carolina has become a new sort of retirement community for many, and the state is doing much better than most others and it should see less severe fall out from the mortgage mess than most other states.
In ten years more than 135,000 new homes have been built in the Charlotte area. The inventory of new homes is lean, but the inventory of resale homes is growing, which has slowed real estate sales.
As one of the country’s largest financial centers, Charlotte has eluded a direct hit from the mortgage mess. But tighter lending standards and lay-offs in the mortgage business have contributed to Charlotte’s down fall.
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| City |
Forecast |
| Raleigh |
− 3.8% |
| Charlotte |
− 3.6% |
| Wilmington |
− 4.0% |
| Durham |
− 3.5% |
| Asheville |
3.2% |
| Greensboro |
− 3.8% |
Charlotte’s housing slump may, however, be one of the shortest in the nation. More than 590 firms announced investments in the region in the first half of 2007, providing new jobs for the area.
An increase in foreclosures has begun to effect the market. Charlotte will see deflating home prices in 2008 for the first time in years forecast by Housing Predictor to be a mild 3.6%.
In Durham housing sales are also off their record pace as increasing inventory hits the market. But a strong regional economy and good job market along with a lower cost of living than in most places will bolster Durham’s future.
Durham is projected to slow down slowly over the coming year, and witness depreciation of just 3.5%.
In Raleigh, which is the second largest metropolitan area in the state next to Charlotte, housing sales have also slowed. But lower home prices and high employment levels should keep the market in check through most of 2008. Prices will soften further, however, a forecast average of 3.8% as foreclosures take a heavy toll on the community.
There’s no doubt home sales have slowed in Asheville, but nothing like other areas of the country. Tucked away in the North Carolina Mountains, Asheville has cooler summers than much of the southeast making it a perfect spot for get-a-ways. A growing second home market is helping home sales in the area forecast to appreciate 3.2% for the year.
In Wilmington a slow down in mortgages hasn’t sent the market reeling much lower yet. But home sales have followed the national trend with an increase in foreclosures. Wilmington is projected to see fewer sales in 2008 and depreciate a forecast 4.0%.
As dramatic as the change in North Carolina’s housing markets was, the correction may be comparatively mild in most of its markets. The vacation markets in Wrightsville Beach, Kure and Carolina Beaches slowed in 2005 and are still experiencing slow sales activity, ailing for more than two years as a major exception in North Carolina’s greatly appreciating real estate markets. It’s about time Wrightsville Beach gets back on its feet.
In Greensboro the housing market has stalled, and it will be at least another year before things improve greatly, forecast to deflate just 3.8% on slower sales. But that’s much better than many other markets across the nation, which will take years to recover.
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