‘Reality check’ for local housing market

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4529 Jessup Grove Road, Greensboro (336) 605-0190 • northwestpeds.com ‘Reality check’ for northwest Guilford’s housing market

Adobe Stock photo According to the Greensboro Regional Realtors Association, the average sale price for a house in Oak Ridge and Summerfi eld jumped 24.4%, from $478,272 to $594,764, this year through April, compared to the same period in 2021. In Stokesdale, the average sale price rose 26.6%, from $334,791 to $423,865. Local Realtors say they don’t see home prices dropping drastically in the coming months, but they do see the market “calming down” and prices leveling out.

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NW GUILFORD – Newly listed houses in good condition are still attracting multiple offers – just not as many as last year when mortgage rates hovered around 3%. Realtors we spoke with recently say they are recommending that sellers dress up their houses with fresh landscaping and paint to appeal to buyers who, due to escalating interest rates, aren’t able to borrow as much money. In contrast to frenzied buying over the past two years, buyers are paying closer attention to prices and looking for homes ready to occupy with few, if any, renovation costs. “Sellers are now getting a reality check about the value of their homes,” said Oak Ridge resident Angie Bird, a Realtor with Keller Williams in Kernersville who added four listings in northwest Guilford County and Greensboro in the past The Northwest Observer • Totally local since 1996 two months. “With interest rates going up, we’re seeing people’s buying power go down a little bit.”

For U.S. homebuyers putting down 20% of the purchase price, rising mortgage rates so far this year have increased monthly principal and interest payments by more than $500 for a medianpriced house, according to Fannie Mae, the government-sponsored mortgage loan company. It forecast the median home price will rise from $355,000 to $384,000 this year.

Mortgage rates are forecast to keep climbing through 2023, according to Fannie Mae. In the short term, it estimated that, on average, fixed rates on 30-year mortgages will rise to 5.1% in the second quarter that ends June 30, up from 3% for the fourth quarter of 2021.

In a forecast last month, Fannie Mae predicted that rates will average 4.8% for all of this year and then increase to 5% in 2023. In turn, the mortgage loan company revised downward projections for home sales and mortgage originations.

“Mortgage rates have continued to rise and are now at their highest level since 2009,” Fannie Mae reports. “We forecast a continued slowdown in home sales to be followed by softening construction activity and, lastly, by a large deceleration in house price growth.”

Broader concerns about the

U.S. economy are also weighing on home buyers, according to Keller Williams agent DeDe Cunningham.

Higher rates are “a bump that people are going to adjust to,” Cunningham said. “What’s adding to people’s trepidation are gas prices and the general feel of the economy.”

Even though the northwestern Guilford market still favors sellers, Cunningham said that “over the last three months, we have crested and we are trending back slowly but surely toward a more balanced market. Homes are still selling, but they may take a few more days and you may get two or three offers, not 15.”

Home prices continue climbing in northwest Guilford, according to local Realtors we spoke with. They attribute the rise to the shortage of housing coupled with the attraction to area schools for families relocating here.

“We still have such a shortage of inventory with so many people needing to buy a house,” said Karen Bolyard, a Greensboro agent with four listings in the Northwest Guilford and Northern Guilford school districts.

Sellers of highly desirable houses are still attracting buyers willing to put down nonrefundable due diligence and forego inspections, according to Keller Williams’ Bird.

And some buyers are still putting contracts on houses without seeing them in person.

“They don’t want to risk them being gone,” Bird said.

Bolyard believes northwest Guilford’s market will remain resilient despite rising mortgage rates.

“I don’t see anything drastic happening in the immediate future,” she said. “It’s going to even out and calm down, but I don’t think it’s going to be crashing.”

Greensboro Realtor Chris Leggette concurred.

“I don’t think we are going to see a drastic drop in price and value of all these homes that people have paid a bunch of money for,” he said.

At least through this past April, housing prices in northwest Guilford continued to climb, according to the Greensboro Regional Realtors Association (GRRA), citing data from the Triad Multiple Listing Service.

The average price for a house in Oak Ridge and Summerfield jumped 24.4%, from $478,272 to $594,764 this year through April, compared to the same period in 2021, GRRA reported. In Stokesdale, the average price rose 26.6%, from $334,791 to $423,865.

As of the end of April, houses in the three towns typically sold for more than the asking price, according to the association.

On the down side, the housing shortage and rising mortgage rates led to a decline in the number of new listings, pending sales and closed sales in Oak Ridge and Summerfield in the first four months of 2022, compared to a year earlier, GRRA reported.

Over the same period, new listings dipped in Stokesdale where pending sales remained even and closed sales increased from a year earlier, the association said.

“I think we are going to see the price of homes stop growing so fast,” said Tim Atkins, an Allen Tate agent in Oak Ridge. “When interest rates go up, the price of homes will have to come down or at least level out.”

Signs of the slowing market are surfacing, according to Leggette.

“In the northwest area, there is not as much fighting over houses,” he said.

“If you’ve got a renovated and updated house, by all means it’s going to sell pretty quickly,” Leggette said. “There may be multiple offers and sales over asking price. For houses that are not (updated), we’re seeing them sit on the market.”

Price reductions are showing up on some listings, a rarity before mortgage rates began climbing.

“Some of these sellers are thinking they can sell their house at whatever price they want,” Bolyard said. “But some have gotten a little too aggressive,” she said.

Her advice to owners preparing to list their houses: “You need to price it aggressively but smart, and not be too greedy.”

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