Notes from the frontline

Writing about the Charlottesville real estate market requires a “boots on the ground” viewpoint. For the past week, I have shown most of the inventory in the $300k-$550k price range in the City of Charlottesville and the urban ring.

1) Appraisals from four, six, eight months ago do nothing other than lead the seller astray. Psychologically, they are not able to come to terms with the fact that their “$500k house is actually worth “$450k.” (and, no, I do not necessarily see this as a “price drop” – it is the non-realization of unreasonable expectations.
2) Negotiating from what you “need to make” is an untenable position. While completely relevant from an individual financial point of view, this position is not relevant from a market-value point of view.
3) As a seller, you might not get a better offer.

You got to know when to hold ’em, know when to fold ’em,
Know when to walk away and know when to run.
You never count your money when you’re sittin’ at the table.
There’ll be time enough for countin’ when the dealin’s done.

4) There are a lot of buyers in the market – they simply have more to choose from and often times, there is more than one “right” house for them.
5) Summarizing the broader Charlottesville market is impossible. As I have said before, there are pockets where multiple offers still exist.
6) Buy smart, with quality representation all the way around. Assembling a good team is crucial.

Teresa had a market snapshot that could have been written about Charlottesville’s market.

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  1. Gerry Davidson August 22, 2007 at 10:45

    Hi Jim, Your comments on pricing are universal. Coming from a builder/sales background I see the perfect analogy. I would cringe when a builder totaled up his cost to build, add the percentage he wanted to make and voila – Sales Price. The market seldoms understands this thinking and is certainly not sympathetic to it. Or take the case of pricing high with the rationalization that if it doesn’t sell I’ll just reduce it. That often results in one reduction after another. And to see multiple price changes, whether on a community price list or in MLS, does not send a clear message to buyers or agents. Proper pricing to your market is key to selling and this is where a good agent produces value. An astute seller is a realistic seller.

  2. Ken Smith August 23, 2007 at 06:59

    I wish buyers would cut the television off.
    I would imagine that the Albemarle market is much like ours here in the Northern Neck were both buyers and sellers are affluent.
    Sub prime – none of my clients fall into this category but the news is really building it up.

  3. JR Jackson August 23, 2007 at 08:17

    The current market woes aren’t just limited to subprime. It’s extended to Alt-A and the jumbo market — the media isn’t making it up. There are more than a dozen of bankrupt lenders and many others that have simply closed down. There were fears of a potential collapse of Countrywide, which would have been a staggering development.
    People simply no longer believe the hot air being blown by the “economists” at the NAR.

  4. Mark August 23, 2007 at 16:21

    “I wish buyers would cut the television off.”
    Did you wish they would cut the TV off from 2001-2006 when real estate was the next hot tech stock, an easy 20% annual gain?

    Now we are at the point where people can’t afford a house: home prices have doubled while salaries have not.

    “Sub prime- none of my clients fall into this category…” This quote reminds me of the New York
    film critic in 1972: “How could Nixon have won? Nobody I know voted for him!”

    -A very NON-affluent potential Charlottesville buyer

  5. Teresa Boardman August 24, 2007 at 09:59

    Thanks for the link love. I guess my assessment is a kind of insiders look at the market. I work almost equally with buyers and sellers and my post contains the words that I hear the most often from each. I was going to add: Teresa says: I need a vacation. 🙂 but decided agianst it.