Pandemic accompanied by fever for home buying in Rowan County
SALISBURY — Victor Wallace has been in the realty business for over four decades, but even he is shocked by what he’s seeing in the Rowan County real estate market.
Despite the country being in a recession, real estate markets across the U.S. have been hot. That includes Rowan County, where homes are selling fast and for more money than they have in years.
The recent success in home building and selling can be attributed to a variety of converging factors, including more millennials being in the market for homes, baby boomers looking to downsize and an emerging trend of people migrating to areas where they have more space and can enjoy a high quality of life.
On top of that, interest rates on mortgages have plummeted, making buying a house more affordable.
“Really, it’s been the convergence of those trends with low interest rates,” Wallace said. “They’ve never been this low in my lifetime. I’ve been in this for 42 years and this is extremely low.”
As a result, Rowan County’s August real estate market was up in almost every statistical category from a year ago, according to data released by the Canopy Realtor Association. While there were 160 new homes listed in August of last year, 213 new listings hit the market in Aug. 2020. Pending sales also increased dramatically, up 60.5% from 152 in Aug. 2019 to 244 in August of this year. The only statistic that was down was the number of days a home was on the market.
The encouraging statistics from last month corroborate what Wallace has seen, which is a robust seller’s market.
“You’ve got all of these things going on and it’s creating a seller’s market, which means prices are going up,” Wallace said. “We’re seeing homes going up and under contract quickly, sometimes with multiple offers.”
Realtor Karla Foster, owner and broker at New Pointe Realty, said that the abundance of home buyers has depleted Rowan County’s inventory of homes.
“We have so many buyers who are ready, willing and able to buy that our inventory can’t keep up,” Foster said. “I have a feeling that a lot of potential sellers aren’t listing who are concerned that their home will sell before they have somewhere else to move into.”
Buyers are keen on purchasing right now for several reasons, but cheap interest rates are among the top.
“When you can borrow money for 2.5% for 30 years, and you can own a house for less than you’re paying for an apartment, it doesn’t take a genius to figure out it’s time to buy a house,” Wallace said.
While interest rates vary from person to person, the average 15-year fixed rate in North Carolina is 2.9%, according to data from Global S&P. With existing homes being purchased quickly, there’s also been a boom in the construction of new housing developments.
“The biggest demand we’re seeing is in new home construction,” Wallace said. “It’s unlike anything we’ve seen, maybe ever.”
Wallace Realty’s subsidiary company, Plantation Ridge, recently turned a stretch of land on Mooresville Road into a burgeoning subdivision called Yorkshire Farms. The land has been divided into about 50 lots for homes to be built on. In the months since the subdivision’s roads were built in March, Wallace Realty has sold 19 of the lots and three homes were already constructed.
“Usually that number (of lots) would last 4-5 years,” Wallace said. “Having 19 lots sold in the first six months is dramatically fast and that’s very encouraging.”
Wallace said that his company is poised to start designing the second phase of Yorkshire Farms, which will include an additional 60-70 lots, in the next several months.
In addition to Yorkshire Farms, Village at Granite and the Reserve at the Country Club are other developments that have seen new homes being constructed recently.
Seeing the housing market thrive is exciting for Rowan County Chamber of Commerce President Elaine Spalding. New homeowners moving in means more customers for local businesses.
“The economic impact is huge,” Spalding said. “Anytime someone buys a new home that means they may need new appliances. So they’re going to go shop for those. They’re buying stoves and washers and dryers and new furniture and drapes.”
As long as mortgage interest rates remain low, Wallace expects Rowan County’s real estate market to remain strong.
“These things always stop at some point, but it’s a little hard to see how these things slow down for several years,” Wallace said. “I see a pretty long runway for housing to be in demand.”