Date Archives July 2012

First Half 2012 – Charlottesville MSA Real Estate Market Report

So … the the first half of 2012 is over. Everyone is looking for signs of recovery in the Charlottesville – Albemarle real estate market – in large part because they want/need the answer to one of these questions:

1 – Can I sell my house/condo/townhouse now?
2 – Can I feel comfortable buying a house now?

The answer to both questions is (as long time readers know): it depends.

Spend some time digging in the data; ask questions, but understand that as localized as this report is, your market – your part of the county, neighborhood, street even is likely to be not be covered by this report. For a true understanding of how you fit into the market, seek professional help (full-time, not part-time/hobbyist advice). Seriously. I do this every. Single. Day. and I can’t imagine trying to make decision or give advice unless I was living and breathing real estate stuff.

– The Days on Market, while an unreliable data point, are down
– The shift to single family homes continues – buyers are buying for longer timeframes – they are buying homes in which to live for 5, 7, 10, 20 years. Smaller condos and attached homes frequently don’t meet those goals.
– Fluvanna was hot. But – Fluvanna has challenges beyond the real estate market that will continue to affect the market and the locality.
– Home prices are up in many segments in the Charlottesville MSA

Sales volume is up, inventory is down.

But … lower housing inventory is not necessarily a sign of recovery.

Lest we get too confident, keep in mind that lower inventory is not necessarily a sign of a recovery; there are a lot of upside-down homeowners who would love to sell but can’t. Until we see appreciation to the point where they can sell, we’re not going to see a true recovery.

In smarter words:

… in markets with unusually tight inventory, prices are being “goosed” higher, not because the housing market is improving, but because there are fewer houses in the game. Low mortgage rates are artificially creating excess demand, with those buyers fighting over the slim pickings of sellers who can actually sell.

But you know what? There’s nothing we can do about that; the market is what it is. We can acknowledge it and make the best decisions possible with the information, data and analysis available.


Brookings Institution’s Metro Monitor
Corelogic’s most recent negative equity report (4Q 2011) shows that Virginia has 23% negative equity and 6% “near negative equity.” Lamentably we don’t have more localized data to the Charlottesville MSA. These numbers feel about right (broadly) for Charlottesville though; Fluvanna’s going to be different than Charlottesville and some condos are different than single family …
Foreclosure Supply and the Housing Market

Mark Hanson makes some interesting points, and this raises the question again of why supply has fallen so sharply. There are probably several reasons for the decline in supply: 1) negative equity keeps people from selling (and buying as Hanson notes), 2) banks aren’t foreclosing quickly and are focusing more on modifications and short sales, 3) cash-flow investors have purchased a substantial number of houses, especially at the low end, and they will not be sellers for some time, and 4) seller price expectations (when sellers expect prices to stabilize, they no longer rush to sell).

My theory from January holds steady, but I may have to revise the percentages a bit to account for underwater homeowners as well.

If you believe these guys, The Housing Bust is Over.

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Stonefield Harming Meadow Creek?

Stonefield wasn’t supposed to open the drain, but they did. And they don’t intend to fix it.

“If this was all in Charlottesville, we would just put a stop-work order on the project,” Tolbert said.

Edens has appealed the violation to the City Council. The Charlottesville Planning Commission will hold a public hearing on the matter Tuesday. 
Edens is in compliance with Albemarle County’s stormwater regulations, according to community development director Mark Graham. However, he had no comment on the city’s claim that a violation has occurred. 
“I do not offer opinions on how the city administers their E&SC program and the city does not offer opinions on how we administer our program,” Graham said. “Both of us follow the same set of State regulations and both of our programs are verified as being in compliance with State regulations by the Virginia Department of Conservation and Recreation.”

If this is all accurate and true – This is the sort of thing that:

1) Makes people hate/distrust developers and good, smart growth.

2) HIghlights how the City of Charlottesville and County of Albemarle really should work together. The Meadow Creek is a shared resource, right? Water doesn’t stop at City/County borders.

3) Seems to be bad for the environment.

If you’re interested, these are some photos of Stonefield I took in November 2011 and January 2012. I’ll try to make it by today to take some new photos.

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Charlottesville is a “Top Vacation City” for Beer

Yes, it’s true. The Charlottesville area has a lot of great breweries. Now Main Street has noticed; naming Charlottesville one of the “top 10 vacation cities for beer lovers“.

Notice though – only one of the five breweries on the Brew Ridge Trail is actually in “Charlottesville.

South Street Brewery is in the City of Charlottesville.

Starr Hill Brewery is in Crozet (Albemarle County)

Blue Mountain, Devil’s Backbone and Wild Wolf are all in Nelson County.

One of the questions I ask new buyer clients contemplating relocating to Charlottesville is, “What does ‘Charlottesville’ mean to you?”. For some, it’s the City of Charlottesville. For some it’s the urban ring of Charlottesville, for others it’s “within 30 minutes of downtown Charlottesville …”

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Appraisal Hotline Coming – Good or Bad?

What could possibly go wrong by injecting yet another governmental agency (YAGAâ„¢) into an already inefficient market?

A federal monitor expects to open a complaint hotline for real estate appraisals by the end of the year.
The Dodd-Frank Act requires the Appraisal Subcommittee, a federal monitor of state bodies responsible for governing valuations, to build a hotline for homebuyers, real estate agents, lenders and others in the industry to raise complaints.

Challenges with appraisals right now aren’t a matter of low or high, the challenges are with accurate appraisals performed by those with geographical and market competency, as well as appraisers being unable to get sufficient data due to unhelpful sellers/MLS and a dearth of valid comps.

While appraisals during the bubble often pushed home prices to artificial limits, many today charge the valuations are coming in too low, forcing purchases to be canceled and shutting out some borrowers from refinancing or modification.

No question – the market is challenging. Adding YAGA isn’t going to help matters. That said, there’s nothing I can do about this other than be informed and aware and work by best within the system we all have to live by.

Whether I am representing a buyer or a seller, all I want is a good, honest appraisal done in a timely fashion by an appraiser who knows this market, has MLS access and a lockbox key. Is that too much to ask? (answer: yes, too often)

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Charlottesville’s Derecho

It’s been an interesting few days in Charlottesville, Albemarle and the surrounding area. We experienced (and learned what it was/was called) a derecho.

Derechos come from a band of thunderstorms that are bow- or spearhead-shaped on radar and, thus, are also called a bow echo or spearhead radar echo. The size of the bow may vary, and the storms associated with the bow may die and redevelop. Winds in a derecho can be enhanced by downburst clusters embedded inside the storm. These straight-line winds can exceed 100 mi/h (160 km/h) (in some cases, sustained wind) in these clusters and straight-line wind gusts of up to 200 mi/h (320 km/h) are possible in the most extreme cases.[citation needed] Tornadoes sometimes form within derecho events, although such events are often difficult to confirm due to the additional damage caused by straight-line winds in the immediate area.

Two people died on Friday night; being without power for a few days pales in comparison to such tragedy.

– People have been friendly, helpful and kind. The offers I have received offering assistance or help from friends near and not so near has been a bit life/humanity reaffirming.

– We learned that Twitter is a far, far better than any other medium for conveying information in a timely fashion.

This is my curated list of Charlottesville media on Twitter. Edits: additions/subtractions are welcomed.

– People want and need information, and they want and need community as well. The time I’ve invested and spent building the community around RealCrozetVA has proven to be a bit useful. It seems a few people actually follow news there, and it’s somewhat gratifying to know that the site/community has been somewhat beneficial to the Crozet community. I couldn’t have built and implemented this overnight; it’s taken years to build something useful.

But … from a comment on Facebook:

… but this storm has made me realize how much I LOVE Crozet. During my very long drive to DE, I went through many areas hit by the storm (not nearly as hard hit as us, in my opinion) and the words rude, impatient and annoying come to mind regarding the people we encountered- nothing like Crozet! …

Charlottesville or Albemarle or Crozet – times like these, as frustrating as they may be, make me realize how lucky we are to live here.

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