Buyer or Seller Market in Charlottesville Right Now?

I showed a client a new listing today; they said, “what do you think about the price?”

I said, “I’ll know in 10 days; until then, the data doesn’t matter, it’s emotions and “how much do you want this house?” After 10 days, the data matter.”

That said, almost every offer I’ve written or received recently has been a competitive one. Some win, some lose. My advice to my buyer clients is always the same – make an offer you’re comfortable winning or losing.

A few questions I’ve gotten recently about the Charlottesville real estate market:

(I looked only at the resale segment of the market for this post)

1. What % of homes go under contract in 10 days or less?

45.0% (193 of 429 ratified contracts). A third — 33.6% — go in five days or fewer. Median days on market is about two weeks. But the ones that don’t sell fast tend to average to 51 days. Price matters.

2. Of sold properties, what % sell at asking or above?

• 18.4% sell over asking (40 of 217)
• 18.9% sell at asking (41 of 217)
• 62.7% sell under asking (136 of 217)
• Median SP/LP: 98.3%. Median SP/Original Price: 97.2%.

When they sell over asking, it’s modest but meaningful — median 1.7% above list, about $10,000 (keep in mind that the median sold price for Charlottesville + Albemarle this year – for resales – is $500K). When they sell under, it’s meaningful — median 3.3% below list, about $19,000. The downside of mispricing costs roughly twice what the upside of a bidding war gains.

3. What are the commonalities in the data?

The sharpest dividing line is speed. The chart below tells the whole story:

• 0–5 DOM: 40% sell over asking, median SP/LP = 100%
• 61+ DOM: 2.8% sell over asking, median SP/LP = 96.7%

Buyer-favorable segments:

• $600K–$750K: 77.4% sold under asking, lowest SP/LP ratio (97.9%) of any mid-range band.
• Charlottesville: 72.5% sold under asking vs 58.1% in Albemarle. City buyers are getting concessions at a significantly higher rate. But … of the homes sold in ?7 days: 60% sold at or above asking (15 of 25).
• Albemarle — of homes sold in ?7 days: 79.2% sold at or above asking (38 of 48). Only 20.8% under. After 7 days: 76% under asking, median SP/LP of 97.3%.
• Anything over $750K: Both the $750K–$1M band (72% under asking, 97.4% SP/LP) and $1M+ (66.7% under asking, 97.2% SP/LP) favor buyers.

Data aside, be ready as soon as the house hits the market to decide to offer or not. If it’s the right house, great. If not, note it, and move on.

Seller-favorable segments:

• $400K–$500K: The only price band with a median SP/LP of 100%. Highest over-asking rate (23.5%), 51.3% under contract in ?10 days. 
• Attached homes: 22.4% over asking, median days on market: 10, 52% under contract in ?10 days. Again, price matters.
• Anything priced right that sells in ?5 days is effectively a seller’s market regardless of segment.

A closer look at the $600K–$750K band

I figured I’d pick one segment for this post.