Tag Archives: Market statistics
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.”
It’s always great to hear NAR’s chief economist talk. He’s in a tough spot – he’s a great economist. But he’s the Chief Economist for the National Association of Realtors – the trade association for Realtors*. Part of his job is to be both an honest economist and to spin the research positively for Realtors. That said, he’s infinitely better than his predecessor. I’m inclined to follow up on our lunch from a couple years ago to see how, if at all, his perspective has changed. That said …
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)
(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. Continue reading
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.
The third quarter of 2013 ended with a neither a bang nor a whimper, but a nice, consistent breathing pattern. As it stands right now, recovery seems to be in full swing.
I’ve said for years to question the data – whatever its source (it’s why I tend to provide raw data for readers to vet). If you’d read the market report from CAAR last week, you’d have been reading
inaccurate conclusions different conclusions than the ones in our report. I won’t go point-by-point through the discrepancies (but will in my monthly note), but will say simply: the conclusions are wrong. We look at data differently using the same sources. As I’ve said for years – question everything (even the stuff I write – and ask me your questions).
If you watch national news you’d see:
- September existing home sales fall 1.9% (USA Today)
- USA Today is much the same as the NAR’s blog post
- Existing Home Sales in September: 5.29 million SAAR, Inventory up 1.8% Year-over-year (Calculated Risk)
- and then we have Zero Hedge: Existing Home Sales Plunge At Fastest Pace In 15 Month As Affordability Drops To 5 Year Low
Those trends are evident in the Charlottesville area as well. As prices rise, sales volume drops.
Some quick year over year numbers for the Charlottesville area:
MSA – sales volume up 19%
Albemarle – volume up 16%
Charlottesville City – volume up 16%
Single family home prices, long the bellwether for the housing market:
MSA – up 10%
Albemarle – up 16.2%
Charlottesville – up 12.5%
Your micro market will vary.
Update: so I upset a few folks with my calling the CAAR report “wrong” and “inaccurate”. I apologize for my tone, but remain 100% confident that the numbers I and we present are accurate. We do use different methodologies when looking at the data.
I’m not trying to pick a fight and could have been more diplomatic in my original post’s tone. For that, I apologize. I cannot apologize for presenting accurate data to my readers and clients.
The news and trends in the Charlottesville market are mostly good.
- Distressed sales are down (but they’re still out there)
- Well-priced homes that are turnkey are typically going under contract in under 60 days. Quality inventory remains a challenge.
- Prices seem to be up across the board.
- Note that these are broad overall trends. Long-time readers know my caveats that “single family homes in Charlottesville City” means all single family homes in the City of Charlottesville … those that are priced below $200k and those that are priced above $600k … and everything above, below and in between. See the chart below for a reasonable justification for questioning all data.