Market Heating Up, Tip to Evaluate Homes, & Unrepresented Sellers | Monthly Note Archive

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Happy January! Buckle up, folks. 2017 is going to be something. If you like this Note, please forward to a friend.*

Caution Advised

I showed a house recently on a Sunday during a public open house. It was a nearly-great house in the City of Charlottesville and priced well. Even in January, when inventory is supposed to be low, quality inventory seems lower than that to which we are accustomed.

The open house was busy. At least 80 sets of buyers came through the house. At least 80. 80.

Another house had at least 4 offers within 36 hours. Another had an offer waive the home inspections.

Make good decisions – whether as a buyer or seller – with competent, professional guidance. Really.

We’ve been here before.

I’m not saying that we’re going to see a bubble and burst in the same form or fashion as we did in 2004 – 2009, but I am advising caution. Caution meaning: Don’t jump just because you think this is the only house on the market that you’re ever going to live/love. There is always another one.

Make sure that as a buyer, you have the life/work/play confidence that this is the place you want to be and live for at least 5 years. The real estate market has been bad; it likely will be again. Choose your home wisely.

I’m not saying we’re in a bubble. I’m not saying a crash is coming. I’m saying, when you come to me to represent you in the sale of your home in X years, I want to hear from you. I want to be able to sell your house. In the last boom, there was a massive influx of real estate agents who saw a quick opportunity; many are no longer here. When choosing your representation, choose wisely.

Remember that the housing boom/bust of the 2000’s was driven in part by subprime loans, but the crisis was driven by much more than that.

I ran into a buyer at Nest the other day who was meeting with her agent. I asked how she was doing; she responded, “I’m terrified.” I think that’s a common feeling in the Charlottesville market right now.

Unrepresented Sellers

I had a different take on this topic; that was before the 80 visitor open house. Sellers: hire competent representation. Not every house is going to have multiple offers. Not every house is going to be inundated with showings as soon as, or before, the house hits the market. A good realtor will help you understand the market, understand the context within which your house fits, and help you negotiate appropriately when the time comes.

One day I’ll write more about a recent example in which this was highlighted, but a good agent is more than a negotiator and guide – a good agent will be a buffer who filters what the client is feeling so as to translate those feelings into useful dialogue.

Ask me about the time an unrepresented seller screamed, cursed, and berated me because they hadn’t done what they said they would, and how they hadn’t read what they were supposed to have read before they agreed to it. It’s a good story. With a happy ending.

Look – even in a crazy hot market, having a professional buffer is crucial. Hire an experienced professional. (I am one)

Real Estate Radio

I’d encourage anyone interested in the Charlottesville real estate market to listen to this hour of radio with Matt Hodges (lender) and me. We touched on a lot of good and relevant topics that I think are valuable to buyers and sellers in the Charlottesville area.

3, 2, 1

Years ago, I was working with buyers who were planning to move to the Charlottesville area from California. We spent a full day looking at properties – nearly 20 of them – and I spent the day taking copious notes on my yellow legal pad. What they liked, disliked, was the location good? Did the house fit? So that when we finished the day, we could do a comprehensive recap to help them recall the house(s) that they liked the most.

When a buyer sees more than 6-8 homes in a day, they tend to get overwhelmed. Now, I use mnemonics when I go through houses … the cold house, the mouse house, the one with the shiny bathroom, etc.

When my clients and I finished that day, I started my recap talk, starting on the first page of my many pages of notes. I remember well when my client said, “oh, honey, we don’t need to do that. We keep a running 1 – 2- 3 of which houses we like. Houses 4 – 20 are irrelevant.”

When I finished bashing my head against a wall, we recounted the three that they liked the most. 4 through 20 never again cluttered the conversation.

The Market

Quick hits
  • City of Charlottesville
    • 599 homes sold in 2016 vs 520 in 2015. 436 of those sold in 2016 were single family, 85 were attached, and 78 were condos
    • Median price – up $14K to $280K
  • Albemarle County
    • 1712 homes sold in 2016 vs 1603 in 2015. 1,157 of those sold in 2016 were single family, 406 were attached, and 145 were condos
    • Median price – up $11K to $336K
  • City + County
    • ?122 more single family homes sold in 2016 than in 2015
    • 37 more attached homes sold in 2016 than in 2015
2017 is going to be something. Some things will sell super-fast. There will be a lot of emotions – on all sides. Breathe. Be calm. Make good decisions you can live with.

New Construction Data

A friend and colleague at Nest, Greg, puts together new construction data for us, and he allowed me to share:

Comparing to last year

Total number of sales were up 22% and total volume was up 22%. This was heavily weighted to the attached side with attached sales up 41% and attached volume up 49%. On the detached side, sales were up 16% and volume up 17%.

In my opinion, this is due to the increase in villa product offerings in the market and many of the townhome offerings in the market now breaking the $400k threshold.

If you want more new construction information, please ask. 434-242-7140 

It’s a hard, and expensive new construction market in Charlottesville.

  • $252M in new construction sales
  • 4 Builders comprised $177M of that $252M
What are your hopes and expectations for 2017 real estate market?

** Reminder: I spend all this time writing this note for consumers … not you real estate folks. 🙂  If you don’t find value in this note, please unsubscribe. Really. Your time is valuable.
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Jim Duncan, Nest Realty, 126 Garrett Street Suite D, Charlottesville, VA 22902. Licensed real estate agent in Commonwealth of VA.

And two photos I wanted to include but couldn’t fit

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