OBX Real Estate in July: What You Need to Know
Greetings from the beautiful Outer Banks of North Carolina! I’m John Head from Colony Realty Sales, here to provide you with our regular monthly update on the real estate market. As we move into the latter part of August, it’s time to reflect on the recent market trends and statistics that have shaped the real estate landscape in our region.
Market Overview
The Outer Banks real estate market has shown a mix of familiar seasonal patterns and some surprising deviations. Historically, summer months tend to see a slowdown in real estate activity as people focus on vacations rather than property transactions. However, July 2024 bucked this trend, with a notable uptick in closed sales.
Inventory Trends
Overall, inventory levels have risen significantly. Since July 2023, total inventory has increased by 37%, and there’s been a 31% increase since January 2024. Breaking it down further:
- Residential Inventory: Up 52% since last July and 36% since the start of 2024.
- Lot Inventory: Up 25% since the beginning of the year.
This increase in inventory suggests a shift in the market dynamics, potentially moving towards a more balanced market, although we still remain in a relatively strong seller’s market.
Sales Performance
Sales figures have presented a mixed bag:
- Residential Sales: Down 6% year-to-date, but July saw a 20% increase compared to July 2023.
- Single-Family Detached Homes: Down 2% for the year, but an impressive 32% rise in July.
- Condo Sales: Struggled, down 11% year-to-date and 18% compared to July 2023.
Contracts and Market Conditions
One area of concern is the decline in properties under contract, which is down—a common occurrence during the summer months as vacationers focus more on enjoying the beach than buying homes. This slowdown, coupled with rising inventory, could tip the scales slightly in favor of buyers. However, the market is still robust, with higher interest rates influencing pricing strategies. Sellers are finding that pricing at or just below market value is crucial for quick sales, with the average days on market currently at 52.
Current Inventory Snapshot
As of August 16th, 2024:
- Active Residential Properties: 705
- Single-Family Homes (excluding condos and townhouses): 574
- Under Contract (Total): 245
- Under Contract (Single-Family): 213
With these figures, if no new listings were to come on the market, we have approximately 34 to 37 months of inventory available.
Looking Ahead
As we head into the fall, the market could experience some shifts due to the upcoming election cycle—a time historically marked by market volatility. However, there is optimism that potential interest rate reductions by the Federal Reserve in September could spur more activity.
A recent slight pullback in interest rates has already led to a modest increase in properties under contract.
Tourism and Rental Market Insights
In my role as a director and affiliate representing the Outer Banks Association of Realtors on the Dare County Tourism Board, I’ve observed a slight decrease in overall occupancy by 2.05% for the year. However, the meals occupancy tax remains nearly unchanged, indicating that visitors are still enjoying the local dining scene. The rental market has seen some adjustments, particularly on the west side, where properties further from the beach are experiencing reduced demand. In response, many owners are transitioning their properties to long-term rentals, an area of specialization for us at Colony Realty.
The Broader Rental Market
On a broader scale, the short-term rental market has seen shifts as well. National companies like Airbnb and Vrbo have experienced changes in their market dynamics, with growth now being driven primarily by the Asian market, while the U.S. market sees a decline. This trend reflects the post-pandemic shift in travel patterns as global travel has reopened.
Final Thoughts
Whether you’re considering buying or selling, the Outer Banks real estate market remains vibrant, with opportunities for both buyers and sellers. If you have any questions about the current market or are thinking about making a move, feel free to reach out to me or one of our agents. You can contact me at john@colonyrealtycorp.com or by phone at 252-592-4629.
Until we see you here at the beach, enjoy the rest of your summer, and I look forward to connecting with you in September.
Take care!
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