Friday afternoon …
I was in class all morning, so am in the midst of catching up. I leave you this Friday with these - (which have interesting headlines, but I haven’t read them all yet)
If Michigan Is Looking at Rapid Transit, Can Virginia Be Far Behind?
TDRs, a Step in the Right Direction
Media Hype? on the emerging buyer’s market
Why do planners favor automobiles? Subscription required after today - read it!
Casualty of the housing bubble
Charlotteville’s blogging roundup
My favorite of the day - Lily Tomlin on Stress
Go outside! It’s a glorious day - 78 degrees and sunny!
Technorati Tags: politics, real estate, sprawl
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Cheating matters
A sign of good things to come?
“Cheating matters. It isn’t OK to cork a bat. Cheaters shouldn’t prosper.”
Is this novel concept making its way into big business? The idealist in me wants to believe that companies such as Home Depot and Bank of America are choosing to make statements about Barry Bonds simply because it’s the right thing to do. The realist/cynic thinks that they wouldn’t say these things if they didn’t believe that at least a large part of the market would buy into the concept that cheating is wrong. Maybe UVa students will start to realize that honor includes self-policing.
Technorati Tags: barry bonds
April’s Forum Watch
The Free Enterprise Forum’s April Forum Watch is out. Take the time to read it. It’s long, and chock full of good information. Zoning, water, growth, phasing … it’s all there.
The Changing market.
The past several days have been interesting, with much discussion off-line (they do happen, you know) about the effects of the changing real estate market. The Wall Street Journal has an excellent summary of what some of these changes mean for different segments of the market. With the standard caveat of “all markets are local… ”
The changing dynamics have implications for a wide variety of players in the real-estate market. Some brokers are advising sellers to price their homes in the bottom 25% of comparable properties. People looking to enter the market for the first time are being told not to overly stretch their finances because rising home prices may no longer bail them out. Employees who are relocating are being advised to steer clear of new subdivisions where competition from brand new construction could make reselling soon difficult.
Such strategies aren’t entirely new, but they had fallen from favor in many markets as home sales heated up early in the decade. Recently, markets have shown signs of cooling. The number of homes for sale has climbed about 30% over a 12-month period, reaching its highest level in nearly 10 years, according to the National Association of Realtors. The group recently predicted sales of existing homes would drop 5.7% this year versus a 4.4% gain in 2005.
Let me be clear - I don’t foresee the market in the Charlottesville/Central Virginia market tanking, prices dropping, or any of the other well-worn clichés that have been bandied about in the media. I have said it before and I will say it again - my crystal ball shows that there will be a decrease in the rate of appreciation of houses. For instead of a 20% year over year increase in value, homeowners may see 5-10% appreciation. I could be wrong, and am certainly open to other opinions.
As the housing market cools, first-time buyers have the opportunity to be more thoughtful about their purchases and to negotiate for a lower price, a more flexible move-in date, or incentives such as seller-paid closing costs.
…
Jill Green, a Realtor with Century 21 Award in Carlsbad, Calif., a coastal community north of San Diego, has been making offers that are 1% to 5% below the low end of the seller’s price range. “Sellers are entertaining the offers and are taking them,” she says.Some brokers are advising first-time buyers to leave a financial cushion instead of stretching as much as possible and counting on rising home prices to bail them out. They are also asking sellers to help with closing costs.
Some brokers? Some brokers? Any who are not advising buyers to ensure that they have a financial cushion/emergency fund is straight-up irresponsible.
In closing, relax. It’s all about the price (and location).
Technorati Tags: Central Virginia, charlalbemarle, charlottesville, real estate
Double check your spelling
I don’t know which bugs me more - the misspelling of “privilege” or the fact that I can’t figure out who spelled it incorrectly in the first place. The Daily Progress’ byline is “From staff reports,” and ESPN’s says “Joe Schad.” Both reports say:
“It is a privelege and not a right to wear a Cavaliers jersey and to represent our university and community,” Groh said. “There are certain things that are vital and those things come into sharper focus and are multiplied when you’re rebuilding, as we are. That’s focus, commitment and dependability.”
I think it’s the misspelling. Good on Coach Groh.
Trends, changes and crap
The Washington Post has a potentially excellent series on Emerging Trends, touching on many facets of the changing market. From one of these articles:
“It’s not what the market will bear anymore,” said Walter Molony of the National Association of Realtors. “It’s a question of what is a fair price.”
Bloggers exempted from campaign laws.
Don’t clog up the blogosphere with your crap. As business blogging becomes more appealing due to the perceived potential return on investment, more are taking to this medium. This is not necessarily a good thing. Those putting “serially-posted advertisements” out there are doing a disservice to those who take time and ownership of what they write and also to themselves. Blog readers tend to be savvy enough to discern when someone is trying to sell them something. Let the market decide.
The Edge of Sprawl. Replace Loudoun with Albemarle. Expand from there.
Open Houses are pretty much, a waste of everybody’s time. But sometimes, they happen to bring that “one buyer” we’ve been looking for … never say never.
Once you find the home you want to buy, discuss making an offer on it with your Realtor. Making your offer contingent upon the sale of your current home is the most common method of doing this, and while this isn’t a popular method to use in a hot market, it is very common in normal and slower markets. The market is normal at the moment, and I recently negotiated one of these contingency offers for clients of mine.
Making offers contingent on the sale of one’s property used to be unheard of. Now, it is becoming more common - so much so that I now consider it a viable option in some cases.
Technorati Tags: blogs, real estate, sprawl, technology
Anecdotal evidence on the local market
The news was flooded last week with reports on the housing market’s decline. This article in the Washington Times is but one example:
The downturn in the housing market is deepening, with new home sales at a nine-year low, prices down for the fourth month in a row and mortgage applications at their lowest point in three years.
…
“We see construction diminishing somewhat and real estate prices flattening, not declining,” she said. “Clearly, however, we could be wrong on the magnitudes.”
I received this email the other day from a reader who is renting in the area -
Did you see this article in Yahoo news? I closed on my house in xxx. Should I wait for a fall back in prices?
Maybe. Maybe not. If there is a compelling reason to to buy rather than rent and you plan to be in the area more than a short period of time, (insert my usual caveats here - if you have good credit, are mentally ready for the responsibility of owning, etc.) then you should probably consider buying. The greatest challenge right now in the market is sellers’ expectations. They have been so conditioned to getting at least the asking price, that some are unable to see the forest for the trees. There is often more to an offer than money. Closing costs, closing dates, etc.
Take the past few days for example - I wrote four offers, all of which are fair offers, based on the recent sold comparable homes.
1) Asking price: $285k. Albemarle. Offered a net of $274k. Seller bought the property for $206k in August 2004. No deal.
2) Asking price: $200. Charlottesville. Offered $200k. Seller bought the property for $89k in 2000. Offer accepted.
3) Asking price: $295k. Greene. Offered $285k. Seller bought the property for $209 in March 2004. We were one of two offers, neither of which was accepted.
4) Asking price: $310k. Waynesboro. Offered $310k. Seller bought the property for $215k in May 2002. Offer accepted.
For all of these offers, I did comparative market analyses. Just because a Seller is asking for a certain price does not mean that is what the property is worth. That said, if a ready, willing and able buyer wants to pay full price, that property is worth full price.
The market is changing. Make no mistake. Are the tires coming off the cart? Doubtful. Are sellers’ expectations in need of adjustment? Yup.
Note: more on the Waynesboro market later.
Technorati Tags: albemarle, charlalbemarle, charlottesville, real estate
Morning links 03-27-06
Retirees and real estate in the C’Ville region
…some states are experimenting with per-mile tax systems. In Oregon, an experimental system uses GPS to monitor how many miles a car drives. Drivers are then charged an appropriate road tax when they fuel up.
Bigger houses bring big and costly energy problems - this is why there is a trend towards more efficient, more functional spaces, rather than just “bigger” spaces. Read: no dining rooms!
UVa. wants an Honor Code, just without real consequences.
“… journalism is an activity, not a profession …”
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