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Chuck Graham-Real Estate Consultant

   

CHARLOTTE AREA
Building Market Analysis

July 1, 2003 – September 30, 2003

EXECUTIVE SUMMARY

Chuck Graham

   

 

3Q3

 

CHARLOTTE AREA

Building Market Analysis

July 1, 2003 – September 30, 2003

Economics

Expansive fiscal and monetary policy has finally bought an economy. Third quarter annualized GDP and productivity Growth rates of 7.2 and 8.4%, although unsustainable are remarkable.

Bush the younger, unlike the elder, does not plan to lose this election because of the economy. The Democrats however can continue to rally around a slightly revised call to arms – Its jobs stupid.

Charlotte MSA

Despite fine national news, the Charlotte economy continues to lag. Employment growth over the twelve months ending August was –0.3% for the nation versus -.08% for North Carolina and –1.0% for Charlotte.

Residential permits were also lackluster. Where as the national permits were up 8% the state and MSA were down 3%.

North Carolina and to a certain extent Charlotte must continue to overcome the loss of manufacturing in the old furniture, textile and tobacco industries. This work is still not over.

Charlotte Market

This five country (Cabarrus, Mecklenburg, York and Union Counties) geography presented a total (new and resales) market which was up 6% for the last twelve months and 23% for the quarter on 5% price increases for both time periods. Most importantly resales were up 9 and 34% versus 1 and 9% for new product.

Within the new offering single family was flat and up 9% for the twelve months and quarter versus attached up 4 and 8%. Single-family permits were up 3 and 9% versus attached up 4 and 6% for the same time periods.

Over the last twelve months Charlotte closed a total of 35,584 residential units including 20,383 resales and 15,246 new.

New Detached For Sale Builders

Although the Beazer-Crossmann combination leads the market with a 7.49% share both builders have lost share in the last twelve months including 4% for Beazer and 16% for Crossmann.

Ryan only trails their share slightly at 7.04% and would be expected to regain the lead title within the quarter. Ryan also grew share by some 15% over the last twelve months.

Of the remaining ten top positions note remarkable share growths by Centex (58%, which was regretfully overlooked in our presentation of 12.10.03), Pulte (26%), Saussy Burbank (11%) and KB, formerly Caliber/Colony, (69%).

Among the five price segments note that Beazer/Crossmann leads Quintile I (<$124,000), KB Quintile II (87% share increase!), NVR Quintiles III, IV, and Va, and Wieland Quintile Vb.

Geographically speaking the Northeast Growth Corridor continues to lead the market (19.02% share) and Quintiles II and III. The South Growth Corridor ranks second (16.27% share) but leads Quintiles IV and V. Although the Northwest Growth Corridor ranks fifth it does lead Quintile I.

Note that Mecklenburg County still captures more than 50% of all new product closings! Union and York Counties rank a close second and third with 13.84% and 12.21% shares.

New Attached For Sale

Portrait continues to lead this market with a 20.09% share including a 31% increase over the last twelve months. They also lead Quintiles I – III of this market (<$141,500).

NRV (Ryan) ranks second with a 9.32% share (down 18% in the last twelve months) but leads Quintile IV ($141,500 - $194,000).

Pulte, which ranks third with an 8.84% share (15% share loss in the last twelve months) runs a close second in the Quintile IV and leads Quintile V.

Geographically speaking the South Growth Corridor leads with a 21.41% share. It also leads Quintiles IV and V. The Northeast Growth Corridor ranks a close second with a 19.14% share and leads Quintiles I – III.

Mecklenburg Country still captures some 82.69% of this product type.

Condominiums

Over the last twelve months Hills Communities led this submarket with a 15.39% share. Others in the top five include Skyline, Boulevard, Park Avenue and Latta Pavilion

Townhomes

During the last twelve months Portrait led his submarket with a 29.18% share. Others in the top five included NVR, Pulte, Mercedes and Cunnane.

CGG: cg

Copyright 2002, Crosland and Newton Graham Consultants,

All Rights Reserved
Contact Chuck Graham at 704.366.2147 Address: 4425 Randolph Rd. Charlotte, NC 28211

E-mail:cgraham6@bellsouth.net

 

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