As the number of residential properties has declined over the past year, some observers of the Hatteras Island real estate market have predicted that the sales of undeveloped lots would increase. Let’s look at the statistics and see if this expectation has been validated by the numbers
The following chart shows the number of residential properties for sale on the island on a monthly basis since Dare County was closed to visitors in mid-March 2020 in response to the COVID-19 pandemic compared to the number of undeveloped lots under contract to be sold (pending sales) during the same period.
At first glance, the pattern of lots under contract over the past 13 months appears to be mixed with the number decreasing between March and June 2020 followed by a five month increase, only to drop again in December and January before beginning another upward movement in February of this year
My sense is that two underlying market forces are at work in producing the results that are displayed. First, each year we normally experience a seasonal rise in the number of undeveloped lots that are sold starting in late summer and lasting until Thanksgiving. In general, buyers like to purchase lots in the fall, build new homes over the winter, and have them ready for occupancy near the start of the new rental season. Second, because we have seen lot purchases rise steadily in February, March, and April of this year rather than later in the fall. I think it is fair to say that undeveloped lot purchases are strengthening in part due to the drastic decline of nearly 75 percent in the inventory of homes available for sale on the island – only 76 residential properties were listed for sale on the entire island at the end of April!
Concurrent with the growth in lot sales, we have seen the median sale price of undeveloped lots increase from $52,500 in the first quarter of 2020 to $86,550 during the same period this year – an incease of nearly 57 percent. This may be a reflection of the relatively inexpensive prices of lots combined with buyers seeking alternative options for their investments
If you have thought about selling a home or undeveloped lot that you own, today’s red hot market makes now the time for action. Contact the Outer Beaches Sales team toll-free by phone at 866.627.6627 or by email at firstname.lastname@example.org for all of your real estate needs!
Tom Hranicka, Sales Department ManagerAssociate Broker
ABR, CDPE, CRS, GREEN, GR