|
The Market
Real Estate in the New Bern, Oriental and Havelock areas is driven by several factors. The first and most obvious factor is the local economy, which is very strong. Growth in commercial properties is very noticeable which is indicative of very active investment in the communities. New residential construction is also very apparent as new developments abound and individual lots in many of the established communities have been purchased and spec homes are being built. Each area also has some significant features that drive its individual market and spill over to the others.
New Bern sits at the confluence of the Trent and Neuse rivers and has a beautiful downtown and historic area that has been heavily influenced by the Swiss Bear Redevelopment Corporation. For the past decade or so, New Bern's reputation has been growing as a destination for retiring folk. This reputation got a tremendous boost when it was one of the featured destinations focused on by the Today Show on March 16, 2005. Immediately thereafter we were inundated with inquiries form all over the country. We see many people coming here from the northeast, upper mid-west, California, and yes Florida. There are many different types of communities from which to choose. There are waterfront, golf, historic districts and just plain ol' regular neighborhoods. Just a few of these communities would be Greenbrier, Taberna, River Bend, Fairfield Harbour, Trent Woods, and Brices' Creek.
Oriental is a quaint little town near where the Neuse River enters the Pamlico Sound. Needless to say it is very conducive to great sailing and fishing. Many neighboring developments have and are springing up around Oriental in Pamlico County. Oriental remains a small town that its inhabitants just love. A feature or detriment, depending upon your viewpoint, is the approximate 1/2 hour drive to a substantial food market.
Havelock is the home of the Cherry Point Marine Corps Air Station and is therefore booming as a result of the growth of the base. Havelock is also located on the Neuse River and therefore has many small waterfront communities nearby. New Bern's residential and home rental market is also favorably impacted by this growth.
Current Conditions
After several years of increasing demand driving new development and existing home sales to new records, the real estate market here in New Bern, Oriental, and Havelock leveled off and now has declined. The screeching halt that came to real estate sales in the northeast and other parts of the country that have fed retirees to our areas has recently impacted our sales.
The year 2005 saw the number of homes sold increase 29% over 2004 with the average home selling for 21% more than the 2004 average home. The number of homes sold in 2006 was almost identical to the number sold in 2005, however the average price rose 11%. The average home sales price increased by just 1 1/4% in '07 compared to '06 while the number of homes sold declined by 19%.
As the real estate market heated up, the days a home remained on the market declined. In '04 the average house took 92 days before a contract was accepted. That time declined to 72 days in '05 and 67 days in '06. However, the average house that received a pending contract in '07 was on the market for 102 days.
So, in summary, what we have in the New Bern Oriental and Havelock markets is an increase in the number of homes being built, a decline in the number of homes sold, a leveling off of the prices at which the homes are selling and an increase in the length of time a home sits on the market. These factors have combined to increase the inventory of homes for sale.
The Future of the Market
So what is on the horizon for the area?
In the short term, the increase of inventory has made it a buyers market. I see an increase in incentives offered by sellers, such as covering some closing costs and agent bonuses. I expect that sales prices will be dropping. Contracts that are contingent upon the sale of a home in another area have increased. Buyers with the ability to close without a contingent contract will be in the drivers seat.
For the longer term, a lot depends on the markets in the northeast and other feeder areas of retiring baby boomers. The New Bern area remains a very desirable retirement destination and the number of retirees is increasing. The cost of property remains very favorable here when compared to those in urban areas throughout the nation. People will continue to look to escape the congestion and the higher cost of living in those areas. Continued growth in the defense arena could sustain values through tougher times elsewhere with sales taking off again when conditions improve in the overall market.
|