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Case Shiller’s Perspective on the Charlottesville Real Estate Market

Jim — Wed, 30 Nov 2011 16:36:10 +0000

Case Shiller’s Perspective on the Charlottesville real estate market summed up in one phrase: it doesn’t exist.

Today I’ll I touch on:

- Case Shiller
- Core Logic
- Charlottesville MLS/analysis on RealCentralVA
- Fiserv/CNN
Context matters.

Case Shiller doesn’t track the Charlottesville real estate market. Nor Albemarle, Greene, Fluvanna, Nelson, Waynesboro, Augusta … Case Shiller doesn’t track Charlottesville. Sure, inferences and implications can be drawn from their conclusions and analysis, but if you’re a buyer or a seller in the Charlottesville real estate market, you need to look at an analysis that speaks to your specific situation.

The chart above and the one at the bottom of this post are still too broad for a real estate buyer or seller to make a solid conclusion. What matters is what’s happening in your specific market segment, whether that’s in the City of Charlottesville or the Crozet part of Albemarle County or the Ruckersville Elementary school district in Greene County … national is useful, so long as you understand the context.*
One of the challenges with analyzing real estate on a local level and communicating that analysis to people broadly (here) and individually (to my clients and prospective clients) is this:

Many consumers are looking for a simple up or down arrow the way Newsweek used to do their trending up or down snapshots (do they still do those?). But the real estate market doesn’t lend itself to “up or down” – it’s sometimes a spiral, sometimes an arrow, and more often resembles the cord of my iPod headphones that have been used by my daughter – infuriatingly tangled, and I’m just looking for sense in it. (or the end)

I wrote in early 2008 that … “The Charlottesville/Central Virginia/Shenandoah Valley markets are not covered by the Case-Shiller index. Real estate is local; while trends may be drawn from this type of research, and while the proverbial turned-corner may still be just over the horizon, it’s important to put his study in the appropriate context. …”

Crap. That “horizon” to which I referred is still a ways off. But … what I said remains true. Case Shiller doesn’t track our market.

Fiserv purports to track our market though. I would be shocked if the Charlottesville MSA (which is what they’re forecasting; like here on RealCentralVA, they actually specify what specific area they’re analyzing/projecting) saw a nearly 5% increase in home prices next year. But …think about this when you look at the below chart from CNN Money:

I want to see their data.

I mentioned this projection to another Charlottesville agent whom I trust and respect and he laughed, “what? Because we have such a massive influx of high-paying jobs?” Aside from the government defense contractors, UVA, CFA, the jobs are coming from smaller firms.

They’re projecting market-wide a 5% increase. That’s inclusive of condos in downtown Charlottesville, single family and attached homes close to the NGIC/DIA military base, newer homes in Fluvanna County and homes for sale in Wintergreen in Nelson County.

But.

While real estate is local and always will be, Case Shiller provides insight into the national psychology of the real estate market – what buyers, sellers, real estate agents, renters – are reading and feeling. And feelings matter.

Let’s have some further context, shall we?

CoreLogic … today released negative equity data showing that 10.7 million, or 22.1 percent, of all residential properties with a mortgage were in negative equity at the end of the third quarter of 2011. This is down slightly from 10.9 million properties, or 22.5 percent, in the second quarter. An additional 2.4 million borrowers had less than 5 percent equity, referred to as near-negative equity, in the third quarter. Together, negative equity and near-negative equity mortgages accounted for 27.1 percent of all residential properties with a mortgage nationwide in the third quarter, down from 27.5 in the previous quarter.

In the 3rd Quarter of 2011, Virginia’s negative equity percentages are 22.9% (down from 23.3% in Q2 2011) and the near-negative equity mortgages are an additional 6.1%. I have no idea (but would love to see) what the respective percentages are for the Charlottesville MSA.

(hat tip: Calculated Risk)

Nationally, the national negative equity percentage is up from 18% in April 2008.

The last thing for today that doesn’t seem to get factored into any of the forecasts or analyses I read is this: homeownership is at depression-level percentages, (census press release here) and I’d wager it’s likely to go lower. As I said above: how consumers feel matters. If they feel that homeownership isn’t right for them, there are going to be fewer buyers. Fewer buyers = small buying pool = decreased demand = likely lower housing prices.

Further, it is important to keep everything you see and read in its appropriate context. The following are my comments from a Facebook discussion with other real estate agents about Zillow*, agents who were questioning Zillow’s usefulness and perpetual misunderstanding of Zillow. Much of my comments can be attributed to Case Shiller and any other data source.

“Use Zillow in context, and explain its limitations and positives. It’s a great tool when it’s understood. … I welcome the opportunity to explain and defend my value and explain how I am better than an algorithm. As of right now, Zillow’s just not accurate in Charlottesville and the value of a good real estate agent is invaluable.

Zillow has a ton of information that can provide a good *guide* – how much a home might be worth (ballpark) and how much it might rent for. It shows the price history. It shows the tax and transfer history (in my market, those are empty … opportunity to show that Z’s not quite that awesome)

Mapping and schools and walkscore all in one place = useful.

Ballpark mortgage calculator = useful.

Nearby comps: utter and complete crap = opportunity to define value of me and of understanding contextual information.

“On Zillow” : does not equate to true days on market = opportunity to explain to my client what those mean.

Zillow is useful. To a degree. Bash it or love it, it’s not going away; better to understand how to explain it.”

** As much as anything, I wanted to capture my comments here rather than on Facebook … there, they’re neither findable nor searchable. Here, they’re mine.

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Case Shiller’s Perspective on the Charlottesville Real Estate Market

Elections 2011 – What’s on Your Ballot?

Jim — Sun, 06 Nov 2011 13:01:58 +0000

“Politicians are like diapers; they need to be changed often and for the same reason.” ― Mark Twain

We vote on Tuesday in what’s termed an “off-off election” meaning … fewer people vote, so your vote will matter more. Please vote.

Here are a few resources:

- Charlottesville Tomorrow’s Albemarle County Board of Supervisors Candidate information

- Charlottesville Tomorrow’s Charlottesville City Council Candidate information

- The Daily Progress rounds up all of the local elections. (great job)

- Unfortunately, Charlottesville Tomorrow doesn’t cover the other important races, but luckily The HooK offers snapshots of the various races, including Albemarle County School Board (I’m endorsing Ned Gallaway for this race), Soil and Conservation District (I like Lonnie Murray)

- cvillenews gives a succinct rundown of which races are on the ballots. I’d clip a bit of Waldo’s post, but really, just read the whole thing.

I’ve done the googling so you don’t have to:

- Albemarle County provides sample ballots for each district.
- Fluvanna County has sample ballots as well.
- The City of Charlottesville has a sample ballot

If you’re trying to figure out what’s on your ballot (and really, you should be) the State Board of Elections provides and excellent resource for figuring out who’s running for what. (I had no idea this was there)

Photo courtesy of

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Elections 2011 – What’s on Your Ballot?

Greene County Real Estate Market Update – August 30 2011

Jim — Wed, 31 Aug 2011 13:00:49 +0000

What does this mean? It means simply that the Greene County real estate market – and Greene County itself – is becoming more self-sufficient and independent of Charlottesville-Albemarle (CharlAlbemarle). People are choosing to buy and live in Greene County and don’t have to commute into the City of Charlottesville or Albemarle to work. I’d *love* to see updated commuting data from the US Census.

In this market, a slowing decline of home prices is a good thing. Seriously.

This is just a reasonably high-level overview of the Greene County real estate market. If you’re curious about what’s happening in your location in Greene, or are currently searching for homes for sale in Greene, please feel free to contact me anytime with questions.

Sold listing volume is down just a bit in Greene County year over year:

Charlottesville MSA Real Estate Market Update – August 2011 – How This Matters to You

Jim — Tue, 30 Aug 2011 13:27:17 +0000

Pending Contracts in the Charlottesville MSA are UP, year over year. But if you’re looking to buy a home in the Charlottesville area or if you’re trying to or thinking about selling, this number doesn’t matter to you one bit. What matters is – what is the market doing on my street? In my neighborhood? In my elementary school district? What happens at the top level – national, state, MSA, locality – is darn near irrelevant other than from a psychological point of view.

Here is why the top numbers don’t matter … there are extremes and outliers everywhere; today’s example:

A house just went under contract in the Bentivar neighborhood. A first look says that the house came on the market at $595k and went under contract in 6 days. If that house sells for $595k, the MLS data will show that it sold for 100% of its asking price. Which isn’t accurate.

The house first came on the market in February 2010 for $1,100,000.
Reduced to $835,000
Came back on the market at $833,000
Reduced to $735,000
Came on the market for $595,000
Went under contract quickly.

Look beyond the numbers presented to you. Here and everywhere. Good real estate professionals don’t try to hide the information, but it takes work to discover what’s actually happening.

** Disclosure: The data presented here is close enough to accurate so as to be relevant. As in, there may be discrepancies between the true data when I dig into it on an individual level and the high-level data presented by the system.

Perhaps the two most relevant posts I’ve written in the past few weeks are these:

- Goodbye, 0-5 Buyer -OR- Finance a House or an Education? in which I discuss the elimination of the short-term homeowner and this effect on the Charlottesville area real estate market and
- Categorizing the Charlottesville Real Estate Market – in which I break the market down into four segments – from distressed to price aggressively.

The Charlottesville real estate market is. It’s good. It’s bad. There are opportunities out there, and there is a whole ton of sadness, despair and unfortunateness. But the market persists.

I’ll boil my advice down to two points:

- Advice for buyers – do your due diligence, be patient, save your money in the meantime.

- For Sellers – as I said last year – do not attempt to chase the market down. Beat it down. (ask me for advice)

Albemarle County Detailed Real Estate Market Report – August 2011

City of Charlottesville Detailed Real Estate Market Report – August 2011

Greene County Detailed Real Estate Market Report – August 2011

Home Price preview at Calculated Risk.

The Five Real Estate What ifs that Make me lose sleep – these haven’t changed, and in fact there are more things that make me lose sleep:

Another reason I’m losing faith in the American system: Huff Post and Forbes.

How to fix the housing mess: until we fix the tax code and minimize the power of our “representatives,” nothing but the status quo will subsists. Until then, I’ll look forward to the “responses” from Rep. Hurt.

If anyone – real estate agent, economist, lender, politician – tells you with confidence that the (insert your locality here) real estate market is doing X, they are either misinformed, lying or confused.

What we don’t know, when looking at top level, aggregate numbers for the Charlottesville MSA (Charlottesville, Albemarle, Fluvanna, Greene, Louisa, Nelson):

- True Days on Market – to accurately ascertain this, one must look at specific properties and property histories.

- True list to sale ratio – to accurately ascertain this, one must look at specific properties and property histories

- True % of “re-listed” properties

- True number of foreclosures and short sales

- Impossible to Predict the Charlottesville Real Estate Market

- Still seeking “normal” in the number of transactions in the Charlottesville real estate market (October 2010)

- First Quarter Market Report for Charlottesville and Albemarle (April 2009) – Added for context

** Disclosure: The data presented here is close enough to accurate so as to be relevant. As in, there may be discrepancies between the true data when I dig into it on an individual level and the high-level data presented by the system.

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Charlottesville MSA Real Estate Market Update – August 2011 – How This Matters to You

Charlottesville MSA Median Prices 2000 through 2011

Jim — Wed, 15 Jun 2011 03:10:56 +0000

Bear with me … I’m trying to make sense of the market.

It seems that we’re back (broadly) at 2004 – 2005 housing prices in Charlottesville.

However, keep in mind that a single family home in the Meadowbrook Hills area of the City of Charlottesville is likely going to have a different valuation history than homes in the 29 North/DIA area. There are so many micro-markets in every real estate market that writing consistently about each of them would be impossible … unless I am representing you.

Continuing my theme of looking at the Charlottesville real estate market data from a longer point of view, lest we track the housing market too closely …

Single family home median prices for Charlottesville MSA:

Attached home median prices for Charlottesville MSA:

I left off Greene and Louisa as they have negligible attached home inventories.Briefly:

Single Family Homes, 2011 vs 2010 for the first five months:

Albemarle: down 7%
Charlottesville: down 6.5%
Fluvanna: Up 2%
Greene: Flat
Louisa: down 33%
Nelson: down 7%

Attached Homes’ median prices 2011 vs 2010 for the first five months:

Albemarle: down 14%
Charlottesville: down 5% (based on 11 closed transactions versus 17 in 2010)

One of the idiosyncrasies with the MLS data is that one person can pull the data one way and get one result and another can pull it a different way and get a different result; this is one way that I say when we look at the data from this level we should look at the trends and think in round numbers …

I know you have to scroll …

Single family home median prices for Charlottesville MSA:

Attached home median prices:

And for kicks and giggles –

Why do I write all these posts about Charlottesville real estate market statistics and data? Because the data is the only truism, and good, accurate, useful, timely data and information matter.

Timely and accurate information, provided on a local level with a real-world perspective, is the real estate market’s most important commodity — and the ability of the public, government, financial institutions, investors and real estate professionals to make informed decisions on local housing markets is the cornerstone of an eventual housing recovery.

Isn’t it time we stop trying to drive by, looking in the rear-view mirror, and insist on seeing just the facts, clearly, as they unfold?

Considering the critical role that real estate statistics play in just about every housing-related decision, it is time for our industry to rally around better data. We owe it to ourselves, our clients and our profession to insist on timeliness and clarity while delving into the motivations and methodologies of every metric we disseminate.

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Charlottesville MSA Median Prices 2000 through 2011

Greene County Townhome Inventory to increase by 500+

Jim — Thu, 02 Jun 2011 14:47:44 +0000

When Greene County gets its 500+ townhomes, it will increase the number of attached housing in that county by many orders of magnitude. Townhomes and townhome neighborhoods in Northern Albemarle – Hollymead, Forest Lakes, Abington Place, Riverwood – to name a few, will be impacted by the entrance – and prospective entrance – of these homes to the real estate market.

For context, a quick look at the Charlottesville Area MLS shows that:

Over the past 21 years (in the MLS which is “accurate enough” for these purposes:

- 25 attached homes have sold.

- 1 attached home is currently on the market (and it’s under contract)

The Free Enterprise Forum reports (bolding mine):

The Greene County Board of Supervisors met with local developer Fried Companies, Inc., last week to hear the company’s consideration to build several hundred townhomes in the Ruckersville area. Mr. Steve Jones, chief operating officer representing Fried Companies, Inc., presented the developer’s ideas to the board regarding the possibility of rezoning the area proposed for the Creekside Subdivision, located on Seminole Trail/Route 29.

The property is zoned R-1, which allows up to 800 single family homes, and according to Supervisor Jim Frydl (Ruckersville), the developer wanted to meet with the board to discuss possible rezoning to a PUD, or planned urban development. A PUD would allow the developer more flexibility in changing the planned development from 800 homes on one-acre lots to 1180 homes, 580 of which would be townhomes, and the remainder, single family homes on various-sized lots. Fried Companies is considering the change because of market conditions, which seem to favor townhomes and smaller homes in general that require less upkeep. In addition, Greene County does not currently offer new construction townhomes, and the belief is they would sell easily.

…

The developer also proffered a phased construction of 100 townhomes per year so as not to invade the market all at once.

See a large PDF of the proposed Creekside community in Greene County.

Features include:

Creekside is an 800 lot single family residential community located with three entrances on Preddy Creek Road. This planned community will have easy access to Route 29 and be within minutes of the NGIC/DIA facilities. The community will incorporate a community park with ball fields and walk trails. This project is approved and will be served by public water and sewer.

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Greene County Townhome Inventory to increase by 500+

Greene County Schools’ Growth

Jim — Mon, 08 Nov 2010 01:04:46 +0000

From the Greene County Superintendent’s blog:

Greene County Public School’s student population has grown by nearly 2% in 2010-2011. That is the second highest enrollment increase by percentage in our region. Harrisonburg City grew by an astounding 4.59%, but we outpaced Albemarle, Charlottesville, Louisa, Madison, Orange, Fluvanna, Rockingham, Staunton, and Nelson.

Interesting. I suppose that quite a bit of that growth can be attributed to NGIC/DIA as well as the fact that now that Greene has a Lowe’s and Super Wal-Mart people are more inclined to stay in Greene rather than always have to go to Charlottesville.

Also, I’d bet that that Hollymead Town Center – Harris Teeter and Target – derives a fair amount of their traffic from southern Greene County. (Preddy Creek neighborhood, for example)

The above post (and the subsequent comment) tracks with this comment in September here on RealCentralVA:

What the NGIC/DIA folks also need to consider is coming 10 minutes north to Madison County. Our schools have a 5 star accredation (sic) and the area is VERY safe and secure without the over development issue. If you want a small farm to keep a pony for the kids or a nice vegetable garden, going north may be the answer. The commute will still be shorter time wise than doing the Albemarle thing.

If you’re curious, you can search for homes for sale in Greene County. Search by Elementary School if you’d like.

Check out the Google Place Pages:

Ruckersville Elementary School

Nathanael Greene Elementary School

Greene County Primary School

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Greene County Schools’ Growth

What a Difference Four Years Make

Jim Duncan — Mon, 06 Jul 2009 17:12:34 +0000

In June 2005, I wrote:

Tuesday dozens of people showed up for the groundbreaking of Greene County’s first active adult community. The community will have more than 500 lots and will include a 16,000 sq. ft. clubhouse. Project mangers believe the community will be an asset for the county. From WCAV.

Age-restricted communities are sorely lacking in our market. I receive a request from buyers for this type of community at least twice a month. These communities have the potential to be a fantastic asset to our region. Seniors typically bring affluence, knowledge and no drain on community resources; read: School systems.

And then in 2009, (also see the Charlottesville Bubble Blog) – the development was foreclosed on.

Most of the nearly 204 acres upon which the Four Seasons age restricted development sits in Ruckersville off U.S. 33 is set to be sold at auction Jan. 22.

But one local realtor says it doesn’t mean the sky is falling, and zoning officials assure residents that the zoning will not change.

In June of 2005 Fried Companies and K. Hovnanian Homes broke ground on nearly 204 acres off U.S. 33 near Advance Mills Road in Ruckersville to make way for the construction of Greene’s first age-restricted gated community.

The Four Seasons Active Adult Community was to consist of 535 homes starting in the lower $300,000 range and a 16,000-square-foot clubhouse for athletic and recreational activities. It was expected to generate at least $1.5 to $1.75 million in real estate taxes annually, representing 9 percent of the county’s then-general fund local source revenue – along with another $1.5 million in sales tax each year.

Since then, the real estate market slumped, recession hit.

The funny thing is – the demand for one-level living is still in the Charlottesville market. The Four Seasons development was, the wrong product in the wrong location (read the comments).

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What a Difference Four Years Make

Where to Search for Rentals in Charlottesville

Jim Duncan — Fri, 12 Sep 2008 17:20:51 +0000

Courtesy of the C-Ville blog citing a newsletter from the Charlottesville Area Association of Realtors -

All those home builders banking on selling houses to new National Ground Intelligence Center (NGIC) employees may be in for a rude awakening. An estimate from the Charlottesville Area Association of Realtors (CAAR) is that only 30 to 40 percent of employees will relocate, the rest not wishing to unsettle spouses and children.

Since NGIC’s expansion was announced several years ago, projects like North Pointe and Hollymead have gotten underway with some expectation of capitalizing on the people

…

“There will be an effect on the local real estate market, but probably NOT 900 new home owners,” said the newsletter. “Many expressed an interest in renting in the Charlottesville area and continuing to maintain their home in northern Virginia.”

D’oh.

Some of those relocating here may not have a choice regarding not selling their homes – many in NoVa have lost so much equity that they cannot afford to sell.

With that preface -

Relocation map – NGIC is in the 29 North region

Posts of enduring interest for buyers

This is where I point prospective buyers/renters – the rental market is far more fragmented with the “for sale” market -

The HooK’s classifieds

C-Ville’s classifieds

Daily Progress

Blue Ridge Apartment Council

Craigslist

Charlottesville MLS

While I make my living representing buyers and seller clients, often it is in their best interest to rent for at least six months to get a feel of the area, a lay-of-the-land, if you will. By giving honest rather than self-serving (buy now!!) advice, I hope and expect that they will reward my candor with loyalty, even if only to refer a friend or family member to me if they themselves don’t purchase.

Better to Beg Forgiveness Than Ask Permission

Jim Duncan — Fri, 05 Sep 2008 16:00:37 +0000

That seems to be the case in today’s news concerning one component of the NGIC/Military Base expansion underway. Reports Charlottesville Tomorrow … (bolding mine)

Two weeks ago, Wood asked the County to allow him to change the layout of two four-story office buildings in the Boulders Office Complex. What was to be basement storage with low ceilings Wood would like to be basement space with ceilings closer to height of a typical office floor. Storage space, however, is required to have ceilings no taller than 6 feet 6 inches. County staff told Charlottesville Tomorrow that it appears the basement of one building under construction has already been readied with bathrooms and HVAC in anticipation of future use. With ceilings placed higher than the storage space maximum, the basements become a new floor on the buildings that could be occupied for future offices, thus requiring Wood to build 200 additional parking spaces, or seek a waiver from that standard. Wood has requested a reduction in the parking requirements, presumably because the taller space will still be used for storage needs of his tenant and not for employees needing parking.

…

Wood’s commercial office complex is developing independent of the nearby military base expansion projects. Ground was recently broken on a $58.5 million Joint Use Intelligence Analysis Facility (JUIAF) located on about 47 acres of land the federal government purchased from Wood. JUIAF will join the National Ground Intelligence Center (NGIC) as part of the growing military base. Wood’s commercial project has been described by the military as something that would support the work at the base by, for example, providing space for private military contractors.

…

Mark Graham joined the meeting in the afternoon and provided the Board with additional information about Wood’s request and the review process. “Everything we have [heard about the use] is anecdotal right now, quite frankly….Because we have heard storage is actually laboratory space as well, so we are trying to get a better handle on what the real use of this space is,” said Graham.

You can’t say no, I’ve already built it! It would be helpful for everybody involved to know how many jobs will be coming here from Fort Belvoir (among other places) as part of the BRAC. (I’m still a little bit stunned that the Charlottesville area now has an official “Military Base” – Rivanna Station – I wonder if they’ll be getting a PX).

More people should mean more parking spaces, regardless of this fact:

… 1,000 people would be coming, only 625 new parking spaces were being built. Moffatt has to meet the federal government’s goal in new construction of only providing parking for 60% of the employees. Slutzky said he was glad to hear about that requirement. “It forces all of us to have to address it and that’s how we get transit results.”

Chicken, meet egg.

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Better to Beg Forgiveness Than Ask Permission

2nd Quarter Market Update for Charlottesville Region

Jim Duncan — Mon, 14 Jul 2008 04:38:22 +0000

Very little has changed since last month’s comprehensive market analysis, published just over a month ago.

First, a quick look back at my responses to the calls of “bottom” over the past eighteen months.

(photo courtesy)

- The market is a bit like the axiom – “a watched pot never boils.” We won’t know how the market is doing today until we look back from a six- to nine-month removed perspective. We can gain insight by looking at the numbers – interest rates, 10 year Treasury notes, pending sales, recent solds … but to get an accurate understanding, we have to look in the rear-view mirror. December 2006

- We’ll know whether we’ve hit bottom today in 18 months when we have the benefit of hindsight. Interest rates remain low. Sellers are motivated, and it really and truly is a great time to buy a house – so long as you do the appropriate due diligence, detach your emotions and negotiate well. September 2007

- I think that the calls for the proverbial “bottom” are premature. When I was a kid I wouldn’t know the bottom of the swimming hole until my toes dug down into the muck and I was heading rapidly back to the surface. Our current market is very much the same. We won’t know when we hit bottom until we have the benefit of 18 months of hindsight – or, to continue the swimming hole metaphor, until we’ve crawled out and told our friends – holy cow! It’s really deep! April 2008

- We may not have seen the worst of what this cycle has to offer. I believe that the bulk of short-term ARMs have not yet reset, and until this happens (likely in 2009 and 2010) we may not see the proverbial “bottom.’ That being said, we won’t know the bottom until we have the benefit of nine to eighteen months of hindsight. June 2008

- The problem with saying we’ve “hit bottom” is that we don’t have anything to base that on other than speculation Yesterday on Twitter

Even Barron’s is saying that we might have hit bottom; the Big Picture respectfully disagrees.

At least I’m consistent. I’m not saying that we haven’t hit the bottom, but that calling it as such with so many unknowns and new variables in the equation would be the wrong thing to do right now, despite Lawrence Yun’s statement – “Without Forecasts, we don’t look credible.”

The Realtor update (1):

1st half 2005: 115 had more than ten sides, 296 had more than five sides, 679 had at least one, with about five hundred or so not having a single transaction

1st half 2006: 107 had more than ten sides, 285 had more than five sides, 740 had at least one, about four hundred fifty not having one.

1st half 2007: 73 had more than ten sides, 232 had more than five, 687 had at least one, about four hundred with zero

1st half 2008: 44 had more than ten sides, 169 had more than five, 619 had had least one, leaving about seven hundred with zero transactions so far this year. (out of 1201 sold residential properties)

From the DP on Saturday:

Many real estate agents may not manage to weather the moribund market before it solidly rebounds, Savage said. A full 15 percent of the Charlottesville area’s 1,110 real estate agents are expected to drop out of the business by January.

“We’re seeing a lot of good Realtors leave the business,” she said, citing the example of two agents in their mid-30s who are quitting soon.

“It’s been a tough time for sellers and it’s been a tough time for Realtors,” Savage said.

Personally, this has been one of the hardest parts of this market – seeing good people leave.

Related reading: A Market in Transition – October 2006

An interesting note: 115 agents have done Dual Agency so far this year (and at least one who has spoken openly against the practice), versus 140 last year and 190 in 2006.

Market Update (2): – Click images for larger versions

Currently there are 2,622 properties on the market.

– 346 have been on the market for at least one year (103 for at least 18 months)

– 924 have been on the market for at least six months

– 1658 have been on the market for at least three months

– 2293 have been on for at least one month

One thing that we are seeing is that more houses are being withdrawn from the market and listed as rentals – ultimately this is a very good thing, as it pulls for-sale inventory off of the market.

Of the 614 properties that are under contract -

207 have Continuous Days on Market (CDOM) of less than thirty days. This is a very, very good sign that sellers are becoming realistic.

288 have CDOM of less than 60 days

347 have CDOM of less than 90 days

If you price your home well/aggressively, you have a much better chance of selling than if you do not. It sounds simple, but it is often a painful, laborious decision that may involve either deciding not to sell right now or asking the question, “can we afford to sell and lose X amount of money?”

Courtesy of one of my favorite writers in the real estate space:

“It’s a buyer’s market… only if you’re actually buying,” I say, having gone through this same exchange on more than a few occasions in recent months.

Conclusions:

- This too shall pass. We’ve been in this downturn for about twenty months now. I predict that we will start to come out of it in the Spring of 2009 at the earliest. Nothing is going to happen before the election, and little is likely to change before December of 2008. Early 2009 will be the time to recover, take our collective breaths and hope for what 2009 will bring. There are too many unknowns right now to make any sort of accurate prediction.

- All real estate cycles come around, and this one will be no different. I subscribe to an outlook that is a mix of Calculated Risk and Nouriel Roubini, in that this recession may look like a “U” rather than a “V” and I sincerely hope that it will not look like an “L.”

- New construction coming onto the market has slowed dramatically, and the number of builders in the Central Virginia region is waning. Ultimately, this may be a good thing.

- Those who survive this downturn (God-willing I’ll be one of them) will come out on the other side far stronger and knowledgeable about the market.

Managing fear is an ongoing task. News about IndyMac and the bailout of Fannie and Freddie is inescapable. Why is nobody listening to this man?

First half market report 2007, with interesting comments.

1 – Realtor Update includes Charlottesville, Albemarle, Greene, Fluvanna, Louisa and Nelson, ~1200 agents total, a “side” is either the buying or selling side of a transaction

2 – Includes Charlottesville, Albemarle, Greene, Fluvanna and Nelson

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2nd Quarter Market Update for Charlottesville Region

One of the differences between Albemarle and Greene Counties

Jim Duncan — Sun, 20 Jan 2008 13:14:24 +0000

I almost titled this post, “ARB? We don’t need no stinkin’ ARB!” But thought better of it.

Albemarle County has an Architectural Review Board that micromanages minutiae.

Greene County does not.

Both Wal-Mart and Lowe’s said they will begin building their new stores there in the spring and fall, respectively. They will serve as anchors for the Gateway Center, a new retail shopping center in Greene County.

Unlike other shopping centers, there isn’t an artist’s rendering available for the Gateway Center; the future of the site’s appearance depends on which businesses move in.
…
“There will be space for smaller retail stores to lease, but the exact location and design have yet to be determined,” Hughes said.
…
Officials know the layout of the site, said Steve Catalano, chairman of the Greene County Board of Supervisors. However, the county doesn’t have an architectural control committee.
…
Catalano said the board did request that the site have “a tasteful appearance.” (bolding mine)

Greene County absolutely needs these stores. The closest “big-box” stores are in Culpeper, about 45 minutes north and Charlottesville, about 20-30 minutes south. The segmentation of our region continues, and I can’t determine yet whether this is a good or a bad development.

What this does mean for certain is that traveling Route 29 is going to become even more time-consuming and frustrating.

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One of the differences between Albemarle and Greene Counties

3rd Quarter Market report for Charlottesville area real estate market

Jim Duncan — Mon, 15 Oct 2007 10:02:04 +0000

What a difference a year makes.

The Charlottesville Area Association of Realtors releases its Third Quarter Market report today. (The full PDF report is here)

There were 2,875 homes sold in the first nine months of 2007, which was down 647 (-18.4%) from last year. All local areas (Albemarle -17.8%, Charlottesville -25.6%, Fluvanna -21.5%, Greene -34.7%, Louisa -18.5%, and Nelson -21.5%) posted lower sales than the same period last year. Looking at the past 6 years (see chart below), our region has returned to a sales level just above 2003 – which was a record at the time.

Interestingly, this report comes on the heels of a post at Inman News that asks this of the National Association of Realtors:

But enough’s enough with the spin. Why can’t they just tell it like it is? Some markets are doing fine, but many are struggling. And while the jobs forecast and interest rate outlook appear to be in good shape, the mortgage market remains a huge wildcard. Prices are falling in many markets, which complicates the delinquency equation as many mortgages continue to reset at higher rates and higher monthly payments.

The new Charlottesville report seems to have less spin than many of the previous ones, which is beneficial to everybody – buyers and seller, the public, the media and the Realtors (and their credibility).

One aspect of the report that needs clarification is this – when looking at non-locality-specific numbers, the numbers they use are for the entire MLS, not just our market area, which I have noted several times before skews the numbers.

In the City of Charlottesville, Albemarle, Fluvanna, Greene, Louisa and Nelson Counties, as of 14 October, 2007:

There are 2,492 properties actively on the market right now.
2,444 properties have sold since the first of the year. (Down 22% versus 2006, down 25% versus 2005, down 19% versus 2004 and down 4.5% when contrasted with 2003)

Currently, we have 3,471 homes on the market and the median price of these homes is $329,000. The average DOM of these homes is 126 days. There are 588 homes for sale under $200,000 with an average DOM of 120. There are 262 homes currently on the market priced at a million dollars or more with an average DOM of 154.

There are 367 homes under $200k on the market (and I don’t have the ability to do the average DOM for that many properties) and there are 170 homes over one million dollars on the market.

A few choice quotes from the report, decidedly un-spun:

In the early part of the decade, we saw extremely low inventory levels of around 4 or 5 months of supply. This caused home prices to soar, as buyers were forced to make aggressive offers to purchase the home they wanted. Today, we have a 20-month supply of homes on the market, which is very high and possibly a record. We are just entering a quieter selling season with the holidays approaching, so we will likely see a continuation of high inventory into the spring. First-time buyers, who don’t have a home to sell, have an extraordinary opportunity in this market.
…
The seasonal aspect of the Charlottesville area real estate market allows us to draw year-end conclusions based on the first three quarters. The balance of the year is the “slow” time for sales, so unless there is a dramatic real estate swing, the third quarter will be reflective of the year-end situation. That means we will end the year with the 4th highest year for sales reported to the CAAR MLS. Prices will continue to rise slowly and inventory will continue to be the big story in the market.

Take note: the lenders do not consider the Charlottesville area a “declining market,” which is declared after a market has witnessed several consecutive quarterly declines. From an email from one of the lenders with whom I work : Northern Virginia is getting hammered; these counties are listed as being “declining markets” – Fairfax, Arlington, Clarke, Spotsylvania, Stafford, Warren, Fauquier, Prince William, Loudoun, Including the following cities: Alexandria, Fairfax, Falls Church, Fredericksburg, Manassas, Manassas Park – sharing the page with Florida and California.

In closing, we see little in this report that is different than the trends we have been tracking all year. Patience and preparation are key virtues for both buyers and sellers.

I’m sticking by my predictions from 1 January of 2007.

As always, all stories about our market statistics are here.

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3rd Quarter Market report for Charlottesville area real estate market

Charlottesville area listing inventory numbers

Jim Duncan — Wed, 10 Jan 2007 18:51:21 +0000

Between the first of January 2006 to the 8th of January 2006, 225 properties were listed. For that same timeframe for this year, 132 residential properties have been listed.*

There were 23 price changes in this timeframe in 2006 versus 60 price changes in 2007. Without a way to determine whether these were changes upwards or down, this is honestly a bit of a shot in the dark; my very educated guess is that these price changes in 2007 were more down than up.

Witness this new construction property in Crozet that came on the market last June – it started at one million three hundred forty nine thousand and was just reduced to $899,000!

—

NB: Contrast what follows with what was released in yesterday’s End of 2006 market report:

One factor that affects the DOM statistic is inventory. If inventory is low, then there are fewer properties for buyers to consider and properties sell more quickly. CAAR tracks the number of new listings that come on the market each quarter to help us monitor the inventory of available homes. As of early January 2007, our database has 2,504 homes actively listed for sale.

What that 2504 number includes is every county that is in our database! Including only our MSA (Albemarle, Charlottesville, Greene, Fluvanna and Nelson), there are as of 10 January 2006, 1672 properties actively on the market. See what a little digging into the numbers reveals?

For example, there are 184 properties on the market in Madison and Orange Counties – at least 35-45 minutes north and north east of Charlottesville. There are 14 on the market in Rockbridge County (home of my alma mater) – at least an hour and fifteen minutes away (realistically 90 minutes).

Less inventory is a good thing, at least in this transitional market.

* Albemarle, Charlottesville, Greene, Fluvanna, Nelson
* This post was inspired by Rob’s continuous tracking of his market. All real estate is local.
* I have not seen an analysis such as this anywhere else.

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Charlottesville area listing inventory numbers

Central Virginia development moves on

Jim Duncan — Wed, 15 Nov 2006 12:40:00 +0000

Biscuit Run, the proposed development to the south of the City has been revised downwards from a proposed 5,000 homes to 3,500 homes. The traffic study work session next month should be interesting.

As always, Cvilletomorrow has much more information as well as a podcast of the planning commission’s meeting.

Wal-mart is finally coming to Greene County! If only NBC29 will stop with the bringing “green” to Greene lines. Hardy-har-har. So clever. There has been much discussion locally about the merits of Wal-mart, but I do know that my clients in Greene will welcome this addition to their community. Soon they won’t have to go to Culpeper or CharlAlbemarle,

Yesterday at an open house for a new development, I was interested to see that their solution, as approved by the County, to the affordable housing situation is to provide affordable “accessory apartments. (pdf)” At least it’s something. More at the County’s website.

Fluvanna’s clustering is moving forward and Daniel has his thoughts on the newest Fluvanna development.

Piedmont Environmental Council’s new report says that we have enough housing in the pipeline. (pdf)

I’ve said it before and I’ll say it again – studies that consider only Charlottesvile/Albemarle or Fluvanna or Greene are too myopic for today’s settlement and travel patterns. We need to look at development and its benefits and impacts from at least a regional point of view.

Housing inventory is up, but development plugs on, and for many, that’s a good thing. The various development industries add so much to our local economy that many don’t realize. Managed appropriately, growth can be good. Might as well attempt manage it, because it seems it’s going to happen anyway.

Tracking all of these things is almost a full-time job!

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Central Virginia development moves on

Housing numbers are down

Jim Duncan — Thu, 26 Oct 2006 18:34:23 +0000

And inventory is up.

Rates are low.
Home price appreciation is slowing.
Inventory is up. Significantly.

note: as soon as I figure out how to upload an image via coding, rather than depending on my normal program, I will.

Regarding NAR’s press release: They have an obligation to present the facts, and their best opinions. Everybody has opinions and interpretation of data. Assumptions and conclusions may (and usually do) differ.

Take this for example:

Total existing-home sales – including single-family, townhomes, condominiums and co-ops – dipped 1.9 percent to a seasonally adjusted annual rate of 6.18 million units in September from a level of 6.30 million in August, and were 14.2 percent below the 7.20 million-unit pace in September 2005, which was the third strongest month on record.

And compare NAR’s spin:

“The good news is that fewer new listings are coming online. A stable sales pace is expected to draw down the number of listings to a supply balance that will support positive price growth within a few months. Taking the long view is always the best way to approach housing decisions, and right now, buyers are in a very favorable market.”

With the Calculated Risk’s “alternate” take on the report:

Sales plummeted 16.3% from September 2005. This is a record YoY (Year over Year) Sales decline.

Median Prices dropped 2.2% from September 2005. Bloomberg: “… the biggest year- over-year decline since record-keeping began in 1969.”

Locally in the Charlottesville region (inclusive of Charlottesville/Albemarle/Fluvanna/Greene/Louisa/Nelson), the market has slowed. Using a quick YoY analysis, in September of 2005, 333 residential properties closed. In September 2006, 211 closed – quite a drop year over year.

Listings under contract – September 2005 – 305 listings went under contract. In September 2006 – 214. Sit down. Take a breath. It will be ok.

And here you have the Virginia roundup from The Housing Bubble Blog, while Dewita’s calling NoVa a Buyers’ Market. A different one, but a Buyers’ Market all the same.

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Housing numbers are down

K Hovnavian slashing development

Jim Duncan — Mon, 09 Oct 2006 20:03:59 +0000

I moved this to its own story, from today’s “Links” post, because they represent the second builder (Ryan was first) to announce major changes. Interestingly, while local builders have seemingly made some significant changes to their pricing and development strategies, it is the national builders who seem most affected. Perhaps the smaller builders are more nimble and able to alter their course? Were national builders more prone to over-extending themselves? I don’t yet know, but remain interested in these developments.

The Greene development is K. Hovnavian’s only development (of which I am aware) in the Central Virginia region. Ryan is everywhere in Central Virginia. Their Four Seasons development also represents something our area desperately needs – housing designed for the 55+ segment of our population – so they do have that going for them.

Read the memo here.

These new market conditions have affected us in many ways and will continue to affect us in the months ahead. In the area of land acquisition we have been re-evaluating our current land positions and the contracts for new land in the light of these new conditions. Many of those contracts no longer make good financial sense when you factor in lower prices and a slower sales pace.

Time will tell …

Inman has the story as well.

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K Hovnavian slashing development

Following the Charlottesville area market trends

Jim Duncan — Fri, 08 Sep 2006 15:59:31 +0000

*Active in August 2006: 432
Active in August 2006: 441
% change: 2.08%
Contingent: -28.74%
Pending: -34.36%
Sold: -21.95%

Very, very interesting data. What do the data tell us about the Charlottesville and Central Virginia area’s real estate market? It has slowed – significantly.

The market is very good for buyers right now – good Buyer’s Agents are advising their clients that there is sometimes significant flexibility in asking and selling price.

From a general market overview, properties are still selling for 97% of their asking price – not bad. In short, don’t believe all the doom and gloom reporting. The market is different. There are more houses on the market now than there have been in many years. Is this a “sky-is-falling” scenario? Not in my humble opinion – market “normalization/cooling/equilibrium” – whatever you want to call it – qualifies as a “good thing.”

A return to a market where the timeframe in which houses are sold and resold is measured in years rather than months is healthy for everybody.

Daniel has the County-by-County breakdown.

*Only for those properties in CharlAlbemarle, Fluvanna, Greene.

New construction numbers in Charlottesville/Albemarle:

Sold from June 1 2006 to September 1 2006: 106
Sold from June 1 2005 to September 1 2005: 140
Sold from June 1 2004 to September 1 2004: 119
Sold from June 1 2003 to September 1 2003: 111

Was 2005 an anomaly? These numbers seem to suggest that the reports of the new construction market’s demise have been – how do they say it – greatly exaggerated? Now, if I were to delve in and see how many now are offering incentives and upgrades …

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Following the Charlottesville area market trends

Market Data for July 2006

Jim Duncan — Sun, 06 Aug 2006 22:28:34 +0000

The past few months have seen some significant changes in our market. It’s not just the interest rates, though – they’ve actually gone down a bit of late. I am running the numbers a little bit differently as well.

*Active in July 2005: 456
Active in July 2006: 418
% change: -8.33%
Contingent: -16.74%
Pending: -29.31%
Sold: -20.02%

In short – the market has slowed. Some would say tremendously. Surprisingly, there were fewer properties on the market in July 2006 versus July 2005, but fewer of those are going under contract. The greatest jump in new-to-the-market inventory was in the second quarter of this year. The big difference is that more of these properties are staying on the market.

From an aggregate point of view, May, June and July -

There were nearly 4% more properties on the market for this time period in 2006 when contrasted with 2005, yet not nearly as many going under contract.

March/June/July

Active: 3.82%
Contingent: -2.32%
Pending: -13.48%
Sold: -5.62%

Bottom line (except for the asterisks): Real estate remains a wise investment. Everybody’s expectations need to be re-evaluated: buyers have time to decide, sellers need patience and agents need educating. The jump of discretionary sellers to the market may have reached or passed its plateau. One month is not enough to make that conclusion, but it may be an indication. Time will tell.

*Only for those properties in CharlAlbemarle, Fluvanna and Greene. As fuel prices have risen, the market has shrunk a bit.

**I excluded neither condos nor new construction for this analysis. Accessing and processing the raw data is extraordinarily time-consuming.

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Market Data for July 2006

Morning links 04-10-2006

Jim Duncan — Mon, 10 Apr 2006 11:17:54 +0000

This is progress? Hat tip to Outskirts.

Low-tech productivity gains a following. I have read 43folders for some time. Whenever someone asks me what the best gadget is for x task, my answer has always been “whatever works for you.” It just might not be the new Palm with all the bells and whistles.

Co-opetition, not com-petition. In one way, blogging is much like real estate – mutual collaboration is a major factor in one’s success. Despite my disdain for anything labeled a “buzzword” I think I like co-opetition. Locally, the cvilleblogs aggregator has contributed significantly to the local community.

Growing traffic touches everyone.

I changed the name. But I need to work on my tagline.

I would love to know more about the goings-on of Walker Square. This marks two very negative stories I have heard (both first-hand) about Walker Square. Clarification anyone?

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Morning links 04-10-2006