Thursday, September 21, 2006

With August sales results just finalized, there is virtually no change in the state of the real estate market on Hatteras Island. The inventory of property for sale is about 60 percent higher than it was a year ago, and both the number of sales and the volume of sales are down approximately 50 percent. While the average selling price of residential properties is 2.4 percent lower for the first eight months of the year compared to the same period in 2005, the average selling price of unimproved lots is up over 28 percent. The Hatteras Island Pending Home Sales Index, a leading indicator of sales 45 to 60 days in the future, has remained essentially flat since last November, suggesting that current market conditions will continue for the next few months. On the positive side, we are receiving more inquiries from prospective buyers. Hopefully, this is a harbinger of better times ahead.

Saturday, September 16, 2006

At mid-month, we continue to dodge the seasonal storms. Ernesto passed well to the west of us; Florence stayed out in the Atlantic Ocean near Bermuda; and, it looks likeGordon will track even further east. Every year at this time, we watch the tropics closely, and keep our fingers crossed that the weather patterns move the storms away from us. We recently heard an interesting statistic that 70 percent of the tropical storms occur after September 1st.

An item that has been in the local news lately relates to the disposition of the Coast Guard housing area in Buxton. The base was closed when the staff was transferred to the southern end of the state. Three options that had been discussed were: transfer the property to the National Park Service to house its employees, transfer the property to Dare County for use as affordable housing for teachers and service workers, and return the property to its natural state. County officials got a surprise last week when the Coast Guard informed them that the property had been appraised at $12 million and that the Coast Guard preferred to sell the property, not give it to Dare County. The Coast Guard base is in a beautiful location adjacent to the area where the lighthouse used to be situated. Unfortunately, there are some fairly significant issues concerning erosion and ocean overwash associated with the property. It looks like it will be a while before a final determination about the future of the base will be made.

At mid-month, we continue to dodge the seasonal storms. Ernesto passed well to the west of us; Florence stayed out in the Atlantic Ocean near Bermuda; and, it looks like Gordon and Helene will track even further east. Every year at this time, we watch the tropics closely, and keep our fingers crossed that the weather patterns move the storms away from us. We recently heard an interesting statistic that 70 percent of the tropical storms occur after September 1st.

An item that has been in the local news lately relates to the disposition of the Coast Guard housing area in Buxton. The base was closed when the staff was transferred to the southern end of the state. Three options that had been discussed were: transfer the property to the National Park Service to house its employees, transfer the property to Dare County for use as affordable housing for teachers and service workers, and return the property to its natural state. County officials got a surprise last week when the Coast Guard informed them that the property had been appraised at $12 million and that the Coast Guard preferred to sell the property, not give it to Dare County. The Coast Guard base is in a beautiful location adjacent to the area where the lighthouse used to be situated. Unfortunately, there are some fairly significant issues concerning erosion and ocean overwash associated with the property. It looks like it will be a while before a final determination about the future of the base will be made.

Tuesday, September 05, 2006

Fortunately, Tropical Storm Ernesto bypassed Hatteras Island with only some wind and a lot of rain. While we were about 100 miles from the center of the storm, there was enough rain to close Route 12 north of Rodanthe for several hours last Friday. To the best of our knowledge, there was no damage from the storm on the island.

The new bridge over Oregon Inlet continues to capture headlines in the local paper. The latest article in The Virginian-Pilot reported that the North Carolina Department of Transportation has come out in favor of the “short” bridge. This follows on the heels of the Secretary of the Interior supporting the same option. While we personally believe that the “long” bridge is the best long term solution to ocean overwash concerns, it is looking more and more like the short bridge will be the one that is ultimately built. We have maintained for a long time that Hatteras Island is more like an archipelago than a solid, enduring land mass, and that a series of bridges over the areas of frequent overwash would eliminate the need for constantly replacing and repairing the “hot spots” on Highway 12.

Friday, August 11, 2006

Two issues are prominent in the news about Hatteras Island these days. One is the new bridge over Oregon Inlet. The other is an effort to construct a multi-use path beside Highway 12 from Rodanthe to Hatteras Village.

The new bridge is a complex topic with a lot a of competing financial, environmental, and political dimensions. On one side of the advocacy are the environmental interests who favor the long bridge alternative that would bypass Pea Island. On the other side, are most of the politicians and beach access interests who favor the short bridge option that in the short run would be less expensive and would assure continued access to Pea Island. Hopefully, the decision will be resolved early next year.

The 22.7 mile multi-use path is in the early stages of planning. According to a local newspaper article, construction will take about seven years to complete. The island really needs a path such as the one proposed. We (residents and visitors) are very fortunate that there have not been more serious accidents involving bicyclists and pedestrians traveling within a few feet of vehicles going very fast.

Kristin, it is good to hear from you. We usually attend the conference every other year. What are conditions like in your market these days?

Tuesday, July 25, 2006

Both locally and in many real estate markets nationally, similar patterns have emerged over the past twelve months. Inventories of properties for sale have skyrocketed. Sales have significantly declined, and price appreciation has moderated. The real estate market on Hatteras Island is off about 50 to 60 percent for the first six months of the year compared to the same period in 2005.

While virtually everyone would agree that the current real estate market on the island is weak, there are some signs that the market may be stabilizing.
• Media speculation about a “real estate bubble” is no longer being seen or heard.
• The Fed appears to be at or near the end of its interest rate increases.
• Nationally, second home sales now account for about 40 percent of all residential transactions.
• Over half of all baby boomers are still under 50 years of age, suggesting strong pent-up demand.
• The Hatteras Island Pending Home Sales Index, a leading indicator of future sales, has shown a slight upward trend over the past eight months.

No one expects a return to the days of double-digit appreciation any time soon, but, as long as the economy remains vibrant, there is reason for optimism that better times may be ahead for the Hatteras Island real estate market. Anecdotal comments from a variety of sources look for positive changes toward the end of the year.

Wise buyers will recognize that all markets run in cycles and that the best time to buy is when everyone else is sitting on the sidelines.

Sunday, January 22, 2006

With year-end results just available, it appears that 2005 will be remembered as the year that the strongest real estate boom in the island’s history began to moderate. After experiencing double-digit rates of appreciation for four years, the average selling price of residential properties increased about 8.2 percent last year, and the average selling price of unimproved lots grew around 7.6 percent.

The speed with which the transition from a seller’s market to a buyers market took place was amazing. Interestingly, real estate markets across the county experienced similar shifts. When comparing 2005 to 2004, many of the major market indicators abruptly changed direction in the second half of the year. Both the number of sales and the dollar volume of sales dropped noticeably in the second and the third quarters.

The good news is that prices have thus far held up, and the underlying market fundamentals that fueled the real estate boom on the island for the past four years still seem to be in place.

What do you see happening to the real estate market on the island this year?