Each month, the Triangle MLS reports statistics on the Raleigh real estate market and the surrounding areas as well. I thought I’d write a quick post summarizing what December (and 2009) looks like vs the previous year. Most of you will not be interested in this, but for stats geeks like myself, you might find it interesting. If nothing else, it will give you reassurance that the Raleigh real estate market is slowly improving, and the trends show that although it has been a tough year, it certainly has not been nearly as bad as other markets around the nation.

In 2009, we saw 21,983 closed sales, an 11.5% decrease from 2008. However, we also saw a larger decrease (-15.6%) in the number of new listings that came on the market in 2009. What this means is that the inventory level, or supply of homes on the market has decreased to 8.6 months. This means that it would take just over 8 months to sell the current listings if no new listings came onto the market. The 8.6 inventory number is supposed to give us a way to determine the supply and demand levels that currently exist in our market.  There are particular places such as the downtown Raleigh real estate market, and parts of the North Raleigh real estate market that have seen a more dramatic reduction in supply, and some places such as certain Cameron Village neighborhoods have actually seen appreciation in the last year.

So, the inventory level really gives us an idea of how healthy our market is. The number has improved 6% from 2008. Most people consider a level of 6 months to be a very healthy market. So as we enter 2010, we see signs that supply and demand are shifting more back toward a seller’s market.

Other stats that are important: average days on market for listings is currently 104 days, and the median sales price is $178,000, down 4.7% from a year ago.

There are still plenty of hurdles ahead for our economy including a bleak job market outlook for the near term future, incredibly high government spending (which could cause interest rates to rise), and an ever growing national debt. These factors could cause high inflation (I see no way around it at this point), but there is a silver lining for real estate owners. If you look back over the last 100 years, hard assets like real estate, oil, and gold often appreciate significantly during times of high inflation. The reason for this is that these commodities are measured in US Dollars, and as the dollar goes down in value, real estate acts as a protection, or “hedge”, against inflation.

My current take: I am actively buying real estate and I would encourage you to do the same. I believe that with interest rates at an all-time low, and prices back to levels that are much more affordable, combined with the fact that Raleigh real estate has been an historically stable market, I think it’s a great time to buy. Whether you are a first time homebuyer or “move-up” buyer looking to take advantage of the tax credits, or an investor looking to create equity through real estate, I think there are a lot of opportunities out there….

My take on the market: Real estate is a segment of the market that follows the same rules as everything else in economics: supply and demand. Two things have happened in the last few months. First, supply has dramatically decreased. New construction has virtually come to a halt, which is good for the market right now as the last thing we need is more homes on the market. Second, demand has significantly increased thanks to low interest rates and lower home prices. Despite the negative media attention, the doom-and-gloom, and all the problems our government has gotten us into… been trying to deal with, the real estate market will, and is, recovering.

Raleigh real estate is one specific section of the national market that is extremely healthy compared to the rest of the nation. Here, sales are up 28% from a year ago and the amount of Raleigh homes for sale has dropped about 15% from this time last year. Our location continues to rank among the top 5 places for population growth and I believe that fundamentally, we live in one of the best real estate markets in the country.

See the video below on the world’s greatest investor commenting on the residential housing market recovering. I disagree with a lot of what Mr. Buffett believes politically,  but I agree that the residential market has reached bottom, and like any other market, it goes up, down and back up again.  One thing I agree with him is his go-to investment strategy of buying when everyone else is fearful. There are still hurdles to jump over, and this will not be the last recession we face, but I truly believe that this could be the best buying opportunity most of us will ever see. I’m actively looking for property to buy and I would encourage you to do the same.   

This home is listed at $247,900 and is in one of the most desired locations in Apex real estate and Cary real estate… just off Davis Drive, close to 64, convenient to Cary, Apex, or RTP. There are not many Apex homes for sale in this price range. Check out my featured listings page for more details and more pictures.