Impossible to Predict the Charlottesville Real Estate Market

If you have been reading RealCentralVA for a while, or we’ve talked in person you know that I have been saying for a while that we don’t know what the market is doing and we don’t know what we don’t know.

I was a bit comforted to read that Robert Shiller, the “Shiller” in “Case Shiller” believes the same thing, whether he’s predicting that the (national) housing market is going to get better or worse.

“Statisticians deal with things that repeat themselves. This housing boom and bust is so historic and unprecedented, you can’t forecast the future because you have no comparison.”

The Charlottesville market could be bottoming, could have bottomed or could have a ways to go. We’re all in uncharted territory.

** John Maudlin ponders whether it might be time to buy a house.

*** Anyone who says definitively or conclusively that the market is X is either (in my opinion) not being honest with you or themselves, selling you something, or doesn’t know the market.

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  1. AB June 13, 2011 at 17:35

    I have been looking to buy a house in Cville for 3 years. Im based abroad and will be moving back 2013. Id  say I look at CAAR twice a week and have done for 3+ years. ( range 1.5m-3.0m) I return twice a year and view properties. Conclusion the Cville mkt in this range is sufferring from indignation. Sellers expect prices generally well above assesment and continually refer to Cville being immune to the crash. Very few houses are sold in this bracket and the inventory rises.
    I can say definitively until these sellers resign to the fact their houses are not worth what they were in 2007  they will not sell them. PS you put a very optimistic spin on the latest Schiller report. When the figures came out every global stock index took note and sold off. Did not read there was a chance of a housing double dip!!!

      1. AB June 15, 2011 at 17:20

        How can it not track your mkt? Im english so Im sorry if my facts I wrong… from memory the index  looks at 20 areas, aggregates and ” hey presto” heres your number.  Its regional to provide an unbiased view to represent the US as a whole. I agree some areas are stronger/weaker than others but you cannot say its has nothing to do with Cville. This is why houses, particularly expensive ones are not selling.  As a buyer I am often faced with response the cville mkt is immune. How can it be??? 

        Spin: the latest report was about housing double dipping, why did you not write  about that? that was the theme of the article. The report says prices “realistic” are at 2002 levels…… cville wants 2007 minus a “little bit”. 

        Sorry to vent but I cannot understand why cville estate agents don’t tell sellers to reduce expectations. Surely you want a good number of sales over one or two  over priced ones!!

        US data is just terrible right now. Unemployment 9.7% Non farms producing 200k jobs less than needed a month, Manufacturing data is getting worse month after month, QE is about to run out so stock mts will have a tough time catching a bid, Fannie/Freddie tightening lending on large loans, Europe going to pot which most likely will cause a major credit event( if this happens the world  will go into recession pos depression), US debt spiral out of control Obama / republicans will be forced into austerity like Europe in August so therefore no pay rises for public workers for the next 5years. 

         YET……….. this is not Cville. 

        I have a house in Cville (small one) I dropped the price 17.5% below assessment and had one viewing. The houses I want to buy want the assessment or more…… go figure.

        Cheers for the response…. I often read your blog, I like the Cville info and your approach. Please note, Im not trying to say your wrong but I do think Cville sellers and estate agents are overly optimistic. 


        1. Jim Duncan June 17, 2011 at 15:23

          I won’t hold your being English against you. :) 

          When I say that it doesn’t track our market, I mean that it is an aggregate that tracks other markets, but not ours specifically. I was talking to one of my clients yesterday who is very familiar with the market (in Charlottesville) and he said that even the data analysis that I put out which is focused solely on on the Charlottesville MSA real estate market, is too broad. 

          There are so many different micro markets in Charlottesville that making any kind of statement about even a particular zip code can be too broad.

          Anyone who tells you that the cville market is immune is lying, selling, or not understanding.

          Spin: because I didn’t want to. 🙂 I thought it most telling that he said that the market is impossible to predict. I’ve been saying that for years; we don’t know what we don’t know, and that is extraordinarily frustrating to me when I am charged (thankfully and humbly) with advising my clients on what to do.

          Venting is appreciated and understood. I do tell my seller clients to reduce their expectations. Recent clients who sold said (I am quoting with permission) that they felt fortunate to be bringing only $14k to the table to close. I don’t think they would have had that reaction had they not been adequately prepared by me.

          Data – agreed. On all counts. 

          I find assessed values to be misleading, distracting and mostly irrelevant with respect to market value. 

          Thank you so much for your comments and time. I sincerely appreciate your insight, your reading and your opinion.

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