Charlottesville real estate market update for January

Here we go –

January-2005-Charlottesville-Msa-Housing-Inventory-1
January-2006-Charlottesville-Msa-Housing-Inventory-1
January-2007-Charlottesville-Msa-Housing-Inventory-1
January-2008-Charlottesville-Msa-Housing-Inventory-1
Inventory is up and sales are down. Surprise.

There is significant, almost palpable fear in the market right now – from Realtors to home inspectors to builders and subcontractors to buyers and sellers (and not all will survive). Pushing beyond those fears is going to be part of the solution.  Fear is not a fundamental.

In a nutshell –

If you are considering buying in the Charlottesville area and living in the house for four to five years (and perhaps a shorter timeframe, depending on various factors) – interest rates are historically low and sellers are negotiating more than they ever have before. It might very well be a great time for you to buy a house.

If you are considering selling – get competent professional advice. Price your home according to what the market will bear. Don’t let emotions get in the way of cold, hard market facts. What the house across the street sold for is likely as irrelevant to determining market value as your new assessment.

For both buyers and sellers – look beyond the headlines. Blanket statements are irrational. “It’s a great time to buy!!! (for some, not all)” There is no one-size-fits-all advice.

Residential homes that went under contract in January in the Charlottesville region*:

2008 – 152
2007 – 230
2006 – 237
2005 – 218
2004 – 269
2003 – 262

Under Contract and Sold in Charlottesville/Albemarle:

2008 – 105/66
2007 – 158/102
2006 – 160/126
2005 – 146/128
2004 – 168/97

Or, by a graphical measure to show the amount of inventory:
2005-2008-Charlottesville-Msa-Housing-Inventory

*Albemarle, Charlottesville, Fluvanna, Greene, Nelson – including single family, attached homes and condos.

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2 Comments

  1. Anonymous Coward February 5, 2008 at 16:13

    Wow. I would caution that one month of data does not make a trend, but more than 20 mos. of inventory? That’s incredible. Unless that inventory figure comes down significantly, we have a strong market signal — prices are way too high and have to come down. That can happen in two ways — (1) sellers cut prices, big-time. Or (2), the market remains in deep freeze for 5 or more years while inflation slowly eats away at the real value of houses. At the current 4% a year, it will take a little more than 4 yrs (remember, inflation, like interest, compounds) for house prices to effectively fall by 20%. That’s my guess re: where they have to go for the market to move back toward a more normal (6 mos or so) level of inventory.

    Reply
  2. Jim Duncan February 5, 2008 at 19:16

    AC –

    Thanks. I paraphrased you on WINA today. 🙂

    It’s only month #1, but we certainly have an interesting year ahead of us.

    Reply

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