I don’t want to write this. I really don’t. This analysis is mostly un-fun to do. *
And so it goes. Every day/week/month reveals that we are in uncharted waters. TARP funds – Paulson doesn’t want ‘em … wait! yes he does , Auto Bailouts, Investment Banking Bailouts, Credit Card companies becoming banks … “There is no playbook” for what we’re experiencing.
Here are the
highlights key takeaways -
- 26 months of inventory**
- Days on Market are up
- Median prices are showing signs of weakness
- Sales Volume is plummeting.
- If you want to sell, price aggressively.
Right now (Sunday, 21 December around 10:30 pm), there are 2,377 homes currently on the market in Charlottesville, Albemarle, Fluvanna, Greene, Louisa and Nelson – 3,298 in the entire MLS.
There are 321 properties under contract; 465 in the entire MLS – I think “pathetic” is the operative word here.
The good news -
- Interest rates are ridiculously low, and loans are absolutely still available.
- It is a Buyer’s market (if you didn’t know) – so long as you look to stay for at least four years. If you’re an investor seeking to buy and hold – I expect that buying today will yield significant returns in 20 years.
- New Construction continues to be slow – and looks to be for the near future – this is good in that existing inventory will be burned through rather than consistently competing with new homes.
- Our region is poised for growth in the future (check back on Wednesday)
The bad -
- Pretty much everything else.
I’m really, really hoping that there is some sort of statistical or data entry anomaly that accounts for the jump from nearly fourteen to nearly eighteen months of inventory. … We’re following normal trend lines, but this is a bit extreme.
It would appear that perhaps we should have been content with eighteen months of inventory. I’m still hoping that there is something wrong with the data.
Pam O’Connor, President/CEO, Leading Real Estate Companies of the World said in a recent Townhall at Inman, “There is a huge appetite for real estate among consumers for statistics and analysis … what does this really mean to me?”
That is what I hope to accomplish with these market reports – to provide context to buyers, sellers, lookers – anyone interested in the real estate market in the Charlottesville region.
This information is not presented as a means by which to scare but to provide information. This is a guide, not necessarily a definitive answer, as each sub-region, sub-area, neighborhood and street is it own analysis.
Let’s start with the median prices of all properties in the Charlottesville region – Year over year, region-wide, sales volume is down about 25%. Albemarle County volume is down about 33% and the City of Charlottesville is down only 11%.
Single Family Homes -
Put simply, sales of single family homes in Albemarle County are down about 25%, the City of Charlottesville is down only about 8.5% and the region is off about 21% year over year. Median prices are down everywhere but Nelson.
One last chart, and evidence of how wacky the MLS data is -
Days on Market are the same year over year??? Median Sales price is up???
Here’s what feels right to me – The number of transactions closed, listings under contract and new listings. When I manually search for new listings in Charlottesville and Albemarle in November, I get 133 – same as the report.
- The information and analysis are only as good as the data available – MLS data is notoriously unreliable (due primarily to those inputting said data) but it’s the best we have. All data comes from the Charlottesville Area Association of Realtors.
- This is my year-end report. I don’t foresee a substantial change in the market between now and the start of 2009. If magically that does happen, I’ll revisit this post.
- There’s been a lot of fear about resetting ARMs – here’s a thought that I haven’t seen elsewhere and that I hope/plan to flesh out in a later post – maybe resetting ARMS won’t be so bad- what if they were to reset downward rather than up?
- Shadow Inventory – or … why 26 months might be under-estimating the amount of inventory on the market.
Next year -
- I plan to systematize these market reports and am exploring some partnerships that would greatly enhance what I have been providing here.
- More PDF reports in printable formats … I’ll PDF this report and dress it up by the end of this year.
- I’d love to be able to start doing land analysis.
- If any commercial Realtor in the Charlottesville area wants to join up to start doing market analyses on the commercial real estate market, please let me know. I suspect that the CRE market is going to be big news next year.
- A continued commitment to transparency – with the data and analysis as well as who I am and how I work.
- More graphs and colors – we all like shiny things, so I’ll do my best to improve the reports.
- If there is anything that you would like to see added, changed, etc. please let me know.
- If you’re in the local media and have questions about this report, the state of the Charlottesville market, why I use numbers only from the Charlottesville area and not outlying counties like Buckingham, Rockingham, Rockbridge, etc. please contact me anytime.
- I’d love to do wage analysis and other more detailed analyses, but I have to make a living sometime!
- * I was having coffee with a friend last week discussing this report among other things, and mentioned how I didn’t want to write this analysis … she said, “That’s your opening;” so thanks for the help!
- WCAV was kind enough to do a story on this report. Any feedback welcome (especially on the video)