Category Archives: Market statistics
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.
Have a few minutes? Curious about what happened in 2014’s first quarter in the Charlottesville real estate market? Spend a few minutes reading our 1st Quarter 2014 Nest Report.
My suggestion? Read, digest, and then ask questions about how the market data and report pertain to your situation.
In trying to figure out the first part of 2014, that’s the best sort-of-analogy I can make. So far, things are looking less awesome than they would appear. There are so many nuances that I tend to look at for clients - new construction versus resale, proximity to whatever it is that is important to them and that particular sub-real estate market, interest rates, ability to walk or bike to groceries and more. But. For a brief high-level look -
It looks like the first two months of 2014 were slower than the first two months of 2013 and March is when the market starts to pick up.
Remember - “Normal” is “Now."
Still trying to figure this out ...
As with some stories I post here, I'm posting for two reasons. First, I want to educate and inform those who read (thank you) and second, I refer to my blog all the time - and it's much easier to google my blog than my brain. For now.
I’ve been looking at some national trends lately and how they affect home buyers and sellers. Lawrence Yun, NAR's chief economist, has been very candid lately. (he also noted a few years ago that there were too many Realtors)
Hearing this story on NPR yesterday was timely, as the two economists echoed what I've been thinking for the past few weeks:
Lawrence Yun has been crunching numbers too. He’s chief economist at the National Association of Realtors. He says for the last six months, fewer than 30% of all home sales were to first time buyers.
“And this is historic lows,” he says. “Typically it should be about 40% to 45%. And I believe the key reasoning is that many of the younger households, they are saddled with student debt.”
Which makes it harder to qualify for a mortgage.
But before we wag the finger at student loans, there may be a twin culprit. Rohit Chopra is the student loan ombudsman for the Consumer Financial Protection Bureau. He says student loan burdens are rising much faster than wages.
“Real wages when adjusted for inflation have actually been flat for new college graduates for about the past ten years. So young people have more debt but are earning the same or less income,” he says.
From what I've seen in my real estate practice, the home buying cycle is slowing down. First time homebuyers are now buying at later stages in life. As noted a couple years ago, the 0-5 Buyer is Gone. And right now,
First time homebuyers, when they do choose to buy, are buying at later points of their lives – once they’ve established themselves in their careers* and found their mates if they so choose, and have determined that their lives – kids on the way, jobs … have or represent some sort of stability.
Many of these first-timers have either seen their friends and families decimated by the housing market or have experienced it themselves in selling or trying to sell – either normal transactions, short sales or foreclosures.
As I noted in my monthly note, so far I (and others) have been wrong about the inventory coming to the market in the Charlottesville area. March and April should prove telling. If more quality, well-priced homes don’t come on the market in those months, I suspect that we’re going to see reduced home sales for the entire year. Keep in mind that “new normal” is another way of saying “today."
If you look solely at the numbers, it looks like housing inventory is up. Not so.
I’ve been thinking for months that we’d be seeing more housing inventory on the market by now. It’s not yet here.
Comparing the first 9 days of February of this year versus last - 116 new listings came on last 1-9 February versus 50 this 1-9 February.
For the MSA (Charlottesville, Albemarle, Fluvanna, Greene, Louisa, Nelson) - 84 this 1-9 February and 210 last 1-9 February.
I'm confused. I know this: I have buyers who are looking for homes to to, and we can’t find them. I get emails frequently from buyers’ agents who are looking for homes for their buyers, and they can’t find them.
If you’re interested, here’s a bit more data:
Update 18 February 2014: this is not merely a Charlottesville - Albemarle MSA trend. Redfin’s post today is outstanding.
Redfin agents say the downturn in demand is uneven. “The picture-perfect homes are selling just as fast as last year, often drawing a dozen or more offers,” according to Redfin Washington, D.C. agent Philip Gvinter. “But now the undesirable properties that would have sold in a few months last year aren’t selling at all. The biggest change is in between, with the sort-of-desirable homes. Last year, these homes got multiple offers and sold quickly. Now, they are getting only one offer during the first week, sometimes having to reduce their price, and the home is taking three to six weeks to sell.”
A few takeaways -
- Rents and renters are rising
- Interest rates are likely to rise this year - he says to 5.3%
- Home sales are up (nationally)
- Home prices nationally have risen 20% (way to fast/high in my opinion)
- Pending sales are down - troublingly so. (see Calculated Risk, Zero Hedge (sales "collapsed" & Big Picture, who uses the term "cratered" referencing pending sales) (results from my running data) For Charlottesville-Albemarle, contracts were down 11%: 226 - from 12/1/13-1/31/14 - number of homes went under contract in the Charlottesville MLS 254 - from 12/1/12-1/31/13 For Charlottesville MSA (Charlottesville, Albemarle, Fluvanna, Greene, Louisa, Nelson), contracts were down 7%: 366 - from 12/1/13-1/31/14 - number of homes went under contract in the Charlottesville MLS 393 - from 12/1/12-1/31/13 -
One of the most striking things I heard him say was this:
Woah. National # from Lawrence Yun - home prices are up 20%; income is up 4%.— Jim Duncan (@JimDuncan) February 6, 2014
Some (many?) parts of the Charlottesville area market are doing better, but if you were about to have a day like I'm about to have, you'd know that there remains a lot of pain and suffering - financial, personal and psychological - in our market. Click through to see the slides from Dr. Yun's presentation.
Market Update for Charlottesville and Albemarle:
Single family home sales in December 2013 vs December 2012: 87/89 - Same, as far as I'm concerned
Single family home sales in 2013 vs 2012: 1302/1215 - Up 7%
Attached home sales in December 2013 vs December 2012: 23/24 - Close enough to be the same.
Attached home sales in 2013 vs 2012: 441/339 - Same
Condo sales in December 2013 vs December 2012: 6/13 - Down 54%
Condo sales in 2013 vs 2012: 167/234 - Down 29%
Keep in mind that these stats are likely not completely up to date, as agents are still entering in closings from 2013. But they're likely close enough to say that there were a few more Charlottesville/Albemarle single family homes sales in 2013 than 2012, attached home sales were about the same and condo sales were way down (mainly because Walker Square condos sold out in 2012). And you know what? We're due for some stability, free of spikes and drops.
List sooner rather than later (Y'know, I'm a Realtor. You could call me . :) )
I suspect that we're going to see more inventory as the year progresses.
More inventory means more competition and selection for buyers. More competition means potential price appreciation for sellers is likely to be diminished.
Curiosity stole an hour of my morning … I intended to update only the Crozet “When do homes come on the market” spreadsheet, got lost there for a bit and decided to look at the Charlottesville MSA numbers.
2012’s Charlottesville MSA sales trends - looking at when homes came on the market, when they went under contract and when they closed.
Well, this is interesting.
And the differential between 2013 and 2012.