Category Archives: General Real Estate
We're at the halfway point. I think the market can be summed up thusly: Buyers are buying, sellers are selling, but there is, and has been, an underlying mistrust of the market by both buyers and sellers. A lot of buyers were burned or saw their friends or parents burned in the previous market and are reluctant to take the plunge to buy. A lot of sellers remain underwater - even those who bought five to ten years ago - and are either reluctant or unable to sell. About a third of sellers nationwide are still in negative equity positions. (I don't have access to local data). Short advice: If you need to sell and can, do. If you want to buy and have the life circumstances to do so, consider buying.
On to the data, solely for Charlottesville City and Albemarle County, respectively:*
Sold in 1st Half 2013: 246 + 695 = 941
Sold in 1st Half of 2014: 259 + 683 = 942
Flat market, right?
Looking broadly at the data, one can reasonably and simply conclude that when prices go up, sales go down and when prices go down, sales go up. In the City of Charlottesville for single family homes, 19 more homes have sold so far this year than last year's first half, but June's median price is down about $5K. The County's market is equally odd; 26 fewer homes have sold in the first six months than last, but June's median price is up by about $28K. Huh?
Micro markets matter.
Broad trends - even at the locality level - can be misleading. I've been advising clients (and writing and writing) that national data, while good for headlines, matters little when making buying or selling decisions in the Charlottesville area. If you're looking to make a decision, analyze your micro market.
For example, the $475K - $600K single family detached market in the Brownsville and Crozet Elementary districts: There are 64 such homes under contract in Albemarle County; 38 (59%) are new construction. In Crozet, there are 22 homes in that price range under contract; 18 (82%!) are new construction. If you're trying to sell a home in Crozet in that price point, your primary competition is new construction and you need to prepare and price with this in mind. In contrast, in Baker Butler and Hollymead Elementary school districts (29 North region), there are 46 single family homes under contract and four in the $475K - $600K range and all are resales. Micro markets are far more relevant than county-state-national market data (or zestimates).
Broadly, we might be witnessing a balancing of the market. I'll let you know next year what today's market is doing.
(All of my PDFs are here, if you're curious and/or you want to fact-check me. Please do; I'd appreciate constructive criticism.)
The inventory question:
In the Charlottesville MSA (Charlottesville, Albemarle, Fluvanna, Greene, Louisa, Nelson), 2,759 homes have been listed so far this year versus 2,876 last year, which is a small enough difference - about 5% - that I'm going to call the new listing numbers mostly flat.
Have questions about the market? Curious what your home might be worth? Thinking about buying? Call or email me anytime - 434-242-7140.
Update 12 July 2014: We at Nest Realty have released our First Half 2014 market report. Download it here; it’s a brand new format - I/we hope you like it!
Update 14 July 2014: I wrote a brief market report specifically for Crozet, Virginia; it’s a highlight that micro markets matter.
Know what this is? (we wouldn’t have had we not done the well inspection)
- This should be required reading - 8 Surprise expenses for homeowners. Changing locks, pest control … in something as rare as a purple dinosaur eating a banana in the middle of a soccer stadium talking on a cell phone, many of the comments are useful.
Another change that the street could see is the addition of elevated and protected bicycle lanes on both sides of the road. Providing bike lanes that are protected from on-street parking could help to reduce the number of bicycle accidents that have occurred along the road. “The bike lanes will probably mostly be used by people who are tootling along, a little slower, maybe have children on bikes, and it’s a safer environment,” said committee member Rachel Lloyd. “People who are really moving can go in the vehicular lanes.”Instead of elevated bike lanes, why not protected ones? - There is so much to the pocket listing conversation; it's fascinating that Colorado's Real Estate Commission may be entering the fray. I wrote about pocket listings last year and earlier this year in my note. - Creepy. What data brokers know about you. One day soon, this will (openly) affect lending. - This is a really interesting conversation on "what businesses should come to Crozet?" I missed the opportunity to better define the question - what anchor industries should come to Crozet? but the discussion was great all the same. Lots and lots of Facebook comments, too. - With clients yesterday, we debated whether the folks who designed Stonefield were drunk or high. We concluded they were probably both.
There are now two ways for a buyer to terminate a Contract with no cause. Since I started in 2001, the buyer has been able to terminate a contract based on the HOA documents - buyers have three days to review the HOA documents.A few months ago the Virginia Association of Realtors released a new home inspection contingency form.
Pursuant to the terms of Contract, Seller shall have all utilities in service If the results of such Inspection(s) are unsatisfactory to Purchaser, in Purchaser’s sole discretion, Purchaser shall provide Seller, prior to Home Inspection Deadline: 1) An entire copy of the report(s) and a written addendum listing the specific existing deficiencies (as defined below) of Property that Purchaser requests Seller to remedy together with Purchaser’s proposed remedies (“Home Inspection Removal of Contingency Addendum,” herein referred to as “Removal Addendum”) OR 2) Written evidence that such Inspection was performed and notice terminating Contract. Upon request by Seller, Buyer shall provide an entire copy of the inspection report to Seller.
At Purchasers' sole discretion, they may terminate the contract so long as they've had the home inspection. Now, the cost of terminating a contract is a couple hundred dollars.
Anecdotally, I'm hearing a lot of stories of buyers using this contingency to back out of contracts for no cause - this isn't good for the sellers, the market or, frankly, for the buyers.
As a buyers' agent: This is good and bad. Good: I want my buyer clients to always have the best opportunity to make the best decisions. Notsogood: I tend to think of a Contract as a binding thing that should be taken very seriously. If a buyer enters a contract thinking already about how they're going to get out of the contract, no one benefits.
As a sellers' agent: This stinks. A seller should have the opportunity to negotiate and remedy deficiencies. Period. This form changes that.
What value is the earnest money deposit? A purchaser could put down an abnormally large earnest money deposit (the deposit they make at Contract Ratification that ostensibly binds them to the contract and represents the amount that they potentially lose if they default) - and get it back if they simply change their minds in the home inspection contingency timeframe.
What is a buyer or seller to do? Know what you're signing.
Things change. Especially so when it’s some else’s property. Spend some time at GIS sites and look at historical photos - everything changes.
The things I dream about ...
I’ve said for years that if you buy a house and are expecting that field (or house) across the way to stay that way you’d best buy it yourself.
In response to my note last month, I received this insightful email: (a few edits for clarity and bolding are mine)
I will say this about the questions "what it's like to live here" as a planner I wish that the local realtors would tell potential buyers in the county (or City …) are those areas that are within the development area and those in the rural. It always amazes me when people get upset about development on an adjacent property when they moved to the development areas. It would be awesome if they were told, "this is the development area so see that nice forested property? It may be developed in the future." Not sure if you are "allowed" to give that info, but I am always amazed by people who get angry that didn't know they bought in a development area. I think it should be added to the MLS, so buyers ask the question of what does that mean.
I make sure my clients are as aware as possible about the risks posed by adjacent properties and what they need to do to educate and prepare themselves.
As far as the MLS having development-area information: the flaw is almost always the human. Whether a house is in the development area would have to be an automated or required field, as many Realtors inputting property data neglect to specify basic data points such as whether a property has high speed internet.
Better yet, wouldn’t it be cool if there was an app that pulled locality data from Albemarle County’s County View and stories from vetted local sources, such as, say, Charlottesville Tomorrow (and RealCentralVA)?
Charlottesville’s going to be changing MLS’ this year and now would be the time to do this. At the same time, how about making "hardwired internet - Yes/No?" Plus a speedtest required fields. Darn it.
Hiring professionals is what professionals do.The guy in the red shirt? He'll take better photos than I would. Note the tripod.
A client asked me the other day -"How do I know who has the best terms?" So naturally I asked a lender I trust for his answer. Matt Hodges with Presidential Mortgage wrote: Well, there’s the following: 1. Rate & points & fees & lock in time frames 2. Meeting commitment/close dates 3. Breadth of products 4. Uniqueness of products – i.e. closing prior to starting your job, gift for 100% of down payment, 100% LTV deals, etc. We all should be .125% in rate apart on any given day, but you might see outliers. For example, I had a rate shopper asking for a conventional 20 year loan and I was able to quote 3.875%, and no one else was better than 4% and some were higher than that. There are a few exceptions to that pricing point, but in general it’s the value a loan officer brings to the picture to get to the finish line with the least amount of upset and on time. ----- I'd add to Matt's last sentence with this: there is tremendous value in a lender (or any professional for that matter) who will: - Foresee and anticipate problems - Acknowledge problems - Communicate problems - If it's their mistake, own the mistake and ... - Fix the problems Also. I like local lenders; as a buyer's agent, they make me immensely more comfortable. As a listing agent, I value a local lender (whom I know to be good) tremendously - and convey that to my clients.