Understanding Charlotte's Buyer's Market

Understanding a Buyer’s Market: Six things you need to know.

Today we are in a buyer’s market in Charlotte. While currently the Charlotte market doing well for sales and values (it is the only one in the country still showing gains of more than 2%), we are definitely in a situation where a buyer can get a great house at a good price. As a home buyer, you may read or hear some numbers and phrases thrown about, so here are the translations and some things you should know if you are buying your new home in the Charlotte area:

1) The average home in the Charlotte area (metro and suburbs) is selling for 95% of the list price (down from a peak of 98%). Meaning: The buyer can get more for less.

2) Homes in the Charlotte are for sale about a month longer – up to 90-120 days on average, than they were at this time last year. Meaning: The seller is more eager to buy and the there isn’t as much competition for houses.

3) The price per square foot is low. Meaning: The buyer can get a bigger house for less money than they could a year ago on average.

4) Interest rates across the country are low. Meaning: If you have good credit, now is the time to consider buying or refinancing.

5) Lots of inventory. Meaning: The amount of houses on the market in the Charlotte area is high. A buyer will not have to settle, since there are a variety of homes in many styles, sizes, areas, neighborhoods and price ranges.

6) Property in Charlotte is a “safe investment”. Meaning: The Charlotte area has head steadily increasing property values, and continues a conservative growth. Other cities in the US in the last few years saw record-breaking and excessive growth and now their bubble has burst. Charlotte’s property values have, and continue to rise without being over-valued. If you buy in the Charlotte area today, generally you can expect a rise in value over time with little risk.

Want more information about the Charlotte area real estate market? Check out www.richferretti.com

Do I need a real estate agent if we build a home?

Dear Rich -

My wife and I are moving to the Charlotte area from Florida and we would like to build a new home. We have been up once before to check out the area and we would like to plan another trip within the next few weeks to look at neighborhoods. My question to you is if we are looking at buying a new house, is there any benefit to working through a real estate agent? Wouldn't it be more cost effective to work directly with the builder?

Thanks for your help on this--we have always bought pre-existing homes before and I want to make sure we make the right decision.

Bob - (Tampa transplant)


Dear Bob -

It is definitely in your best interest to have an agent when dealing building, or purchasing a new build home from a builder. Many times the buyers think they will get a better deal if they do not bring their own agent. Nothing could be further from the truth. While there are some differences in the transaction, there is much that is the same from buying from another owner: you need someone to look out for your best interests.

When you look at a planned or new development, the builder's salespeople will be very friendly and helpful. But remember, they work for the builder, and are being paid to sell you a house at the highest price they can get from you. A buyer's agent will know what can be negotiated, and give you an objective assessment of the neighborhood, homes, and construction. Additionally, a buyer's agent will be able to make sure the contract includes everything you want, and excludes any surprises. Remember, this is a 150K, 250K, 350K decision. You need professional representation from someone who understands this market, real estate and property contracts! This is an investment--so it is important to protect yourself--use a Buyer's Agent!

Best of luck with your move, and feel free to call my office ( 704-564-0807) and we can set up an appointment to go meet with some builders.



Would you like more information on new home purchases and why buyers should use an outside Realtor/Broker not the sales agent at the builder’s office? Email Rich Ferretti.

Want more information about the Charlotte area real estate market? Check out http://www.richferretti.com/

What Upgrades Should I Do on a New Home?

Dear Rich,

We are buying a new home in Charlotte, NC and we are not sure what upgrades we should do in terms of what will hold the most value for the house in the future. Or is it better to just add square footage to the home – adding something like another bedroom or a sunroom. Your advice is appreciated!
Sonny – Charlotte

Dear Sonny – the right answer is that there is no right answer! It depends a lot on what you do, how well you do it, and where you are in terms of location. Also, are you buying this home to live in, or is it instead an investment property? Generally upgrades to a home are more for the comfort and happiness of the residents. They rarely give the home significant additional value. That said, an updated/upgraded home may be more attractive to buyers later on when you go to sell.

If you are looking at this home as an investment, then do minimal updates to keep the house current, but don’t go wild with trendy things and extras. Think basic, clean and “blank slate.” However, if the house is going to be your home, think about what will make you happiest—Bathrooms and kitchens often add the most value, and make a house more attractive to you and later buyers and increase your quality of living—but they are also the most expensive!

I almost always recommend upgrading the carpet and the carpet padding. The builder’s grade carpeting generally wears very quickly and is of low quality. It shows stains and looks old fast. If the house was previously owned, then it is always nice to start fresh with something brand new and free of the previous owner’s dog hair, stains, dust, etc. New carpet just always makes a house look better and cleaner, and it is an easy and relatively inexpensive update. (For the record, as a real estate agent trying to sell a new home, I will often recommend that the seller put in new carpet before the house is shown!)

Other great updates are things like landscaping, a new front door, or windows—especially on older homes.

As for your question on square footage, it is always nice to have more, but be careful when you add onto a home to get all appropriate permits and hire a professional contractor. This is one of those things you want to do right—so don’t skimp. However, also don’t expect to necessarily get your money back when you resell. Depending on what you do, the other homes in your neighborhood, and your location, this may be one of those things you do because it will make YOU happier living in your home, not because you will make money off of it.

Bottom line, if you have a limited budget think about the things that will make the biggest impact for the least amount of money: carpeting, paint, moldings, windows, landscaping, closets. Then think about those bigger upgrades: the deck, sunroom, kitchen remodel, bathrooms, etc. Remember if this is your home, you have to be happy here!

Enjoy Charlotte! And please let me know if you would like my recommendations on specific trusted home improvement vendors in the Charlotte area.

Rich Ferretti

Want more information about the Charlotte area real estate market? Check out www.richferretti.com

What is a Buyer's Agent?

Dear Rich -

I am thinking about moving -- I live in Charlotte now, and I want to downsize into a smaller home or condo -- but I am confused by some terminology...What is a "buyer's agent?"

Thanks
Gene S -- Uptown Charlotte


Dear Gene:

Great question - the term "buyer's agent" is a little misunderstood, but let me try to clear it up a little bit for you, and explain the benefits of working with a buyer's agent.

Real Estate brokers assist sellers in marketing their property, bringing in potential buyers and selling it for the highest possible price under the best terms. The difference between a traditional broker arrangement and the use of a "buyer's agent" is that the Buyer's agent has signed a legal contract with a buyer to become the buyer's representative in searching and negotiating for property at the best possible terms for the buyer.

In addition to working with the buyer to negotiate the best price, they will also ensure the property is inspected, and make sure you have the representation you need. Things you tell a buyer's agent remain confidential. Using a buyer's agent also means that you will be shown homes that are For Sale By Owner (FSBO).

As a real estate buyer's representative in the Charlotte area, I work for, and owe fiduciary responsibilities to, the real estate buyer and have home buyer's best interests in mind throughout the entire real estate process.

It is my job to:
1. Evaluate the specific needs and wants of the buyer and locate properties that fit those specifications.
2. Assist the buyer in determining the amount that they can afford (pre-qualify), and show properties in that price range and locale.
3. Assist in viewing properties -- accompany the buyer on the showings, or preview the properties on behalf of the buyer to insure that the identified specifications are met.
4. Research the selected properties to identify any problems or issues to help the buyer make an informed decision prior to making an offer to purchase the property.
5. Advise the buyer on structuring an appropriate offer to purchase the selected property.
6. Present the offer to the seller's agent and the seller on the buyer's behalf.
7. Negotiate on behalf of the buyer to help obtain the identified property -- keeping the buyer's best interests in mind.
8. Assist in securing appropriate financing for the selected property.
9. Provide a list of potential qualified vendors (e.g. title companies, inspectors, carpenters, etc.) if these services are needed.

I have also taken extra courses and met additional requirements to be able to use the coveted title ABR (Accredited Buyers Representative).

I hope this answered your question, and I look forward to the opportunity to work with you as YOUR buyers agent!

Rich Ferretti


Want more information about the Charlotte area real estate market? Check out www.richferretti.com