If you look solely at the numbers, it looks like housing inventory is up. Not so.
I’ve been thinking for months that we’d be seeing more housing inventory on the market by now. It’s not yet here.
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Lawrence Yun Came to CAAR
It’s always great to hear NAR’s chief economist talk. He’s in a tough spot – he’s a great economist. But he’s the Chief Economist for the National Association of Realtors – the trade association for Realtors*. Part of his job is to be both an honest economist and to spin the research positively for Realtors. That said, he’s infinitely better than his predecessor. I’m inclined to follow up on our lunch from a couple years ago to see how, if at all, his perspective has changed. That said …
A few takeaways –
– Rents and renters are rising
– Interest rates are likely to rise this year – he says to 5.3%
– Home sales are up (nationally)
– Home prices nationally have risen 20% (way to fast/high in my opinion)
– Pending sales are down – troublingly so. (see Calculated Risk, Zero Hedge (sales “collapsed” & Big Picture, who uses the term “cratered” referencing pending sales)
(results from my running data)
For Charlottesville-Albemarle, contracts were down 11%:
226 – from 12/1/13-1/31/14 – number of homes went under contract in the Charlottesville MLS
254 – from 12/1/12-1/31/13
For Charlottesville MSA (Charlottesville, Albemarle, Fluvanna, Greene, Louisa, Nelson), contracts were down 7%:
366 – from 12/1/13-1/31/14 – number of homes went under contract in the Charlottesville MLS
393 – from 12/1/12-1/31/13 –
One of the most striking things I heard him say was this:
Woah. National # from Lawrence Yun – home prices are up 20%; income is up 4%.
— Jim Duncan (@JimDuncan) February 6, 2014
Some (many?) parts of the Charlottesville area market are doing better, but if you were about to have a day like I’m about to have, you’d know that there remains a lot of pain and suffering – financial, personal and psychological – in our market.
Click through to see the slides from Dr. Yun’s presentation.
Why Are Charlottesville Home Prices So Much More Expensive than Where I’m From?
I hear this a lot. “Why are homes in Charlottesville so much more expensive than where I’m moving from
I hate to say this, but the answer starts with because. And expensive is relative – it depends on where you’re coming from. But yes, we tend to have higher housing costs than many other parts of the state and country. But we also offer a remarkable location – close to hiking and mountains, a short drive or train ride to DC, Richmond is less than an hour away.
But I also say this having represented buyers who have chosen to not relocate to the Charlottesville area because I showed them homes that just didn’t fit what they could get back home, I’ve represented buyers who have made compromises on what type, style, size home, and I’ve represented buyers who’ve found exactly what they were looking for.
– Because Charlottesville truly is a great place to live.
– Because of supply and demand – a lot of people choose to live here.
– Because quite a few people see Charlottesville as a destination location – they either move here and keep their jobs in Seattle or LA or Boston or – or they are retired or semi-retired. Many want to live in a college town where one of the biggest negatives is choosing between the things to do in your free time.
– Because CharlAlbemarle is always on some kind of best list .
– Because you can get most places in 20 minutes or less. (when I was a kid, it was 13-15 minutes, and today sometimes that 17 minute drive takes 40 – but still.)
Because. And I’m not the only one … Spend a few minutes reading the great comments and discussion we had about this topic on Twitter and Facebook. It’s truly a great conversation with insight from people who live here, grew up here who no longer live here and clients whom I’ve represented. Really. Read the comments.
If you’re curious, here’s some data I pulled – just for single family homes in Charlottesville, Albemarle, Fluvanna, Greene and Nelson Counties –
– Sales and Inventory history 2001 – 2004
– Sales and Inventory history 2005 – 2009
Who Wants to Hear an Hour of Real Estate Radio? – 26 January 2014
If you’re thinking about buying or selling in the Charlottesville area or curious or interested in the Charlottesville (and regional/national) real estate market, you might find some value in listening to this Sunday’s WNRN Wake-Up Call.
Matt Hodges and I will discuss the current state of the Charlottesville area real estate market, mortgages, tips for buyers and sellers, etc. We’ve done this every year for the past six years and every year each time has produced conversations. If you’re interested in us talking about something specific, please leave a comment or let me know.
Matt’s initial notes of stuff to talk about:
– Ability-to-Repay and Qualified Mortgages
– Recent Bureau of Labor Statistics payroll releases, 2/6 release and what it means to borrowers out there + Federal Reserves tapering decision and what it means
– Predicted increases in rates to 5 – 5.5% and how that affects ability to purchase vis a vis today’s rates
My initial notes of stuff to talk about:
– Brief market update
– How new mortgage laws may impact buyers’ and sellers’ decisions
– Current massive growth and density in the City of Charlottesville
– What buyers should be doing right now who are planning to buy this year
– What sellers should be doing right now who are planning/hoping to sell this year
– Inventory levels in the Charlottesville MSA
Brief Real Estate Market Update for January 2014
A snippet from my monthly note:
Market Update for Charlottesville and Albemarle:
Single family home sales in December 2013 vs December 2012: 87/89 – Same, as far as I’m concerned
Single family home sales in 2013 vs 2012: 1302/1215 – Up 7%
Attached home sales in December 2013 vs December 2012: 23/24 – Close enough to be the same.
Attached home sales in 2013 vs 2012: 441/339 – Same
Condo sales in December 2013 vs December 2012: 6/13 – Down 54%
Condo sales in 2013 vs 2012: 167/234 – Down 29%
Keep in mind that these stats are likely not completely up to date, as agents are still entering in closings from 2013. But they’re likely close enough to say that there were a few more Charlottesville/Albemarle single family homes sales in 2013 than 2012, attached home sales were about the same and condo sales were way down (mainly because Walker Square condos sold out in 2012). And you know what? We’re due for some stability, free of spikes and drops.
List sooner rather than later (Y’know, I’m a Realtor. You could call me . 🙂 )
I suspect that we’re going to see more inventory as the year progresses.
More inventory means more competition and selection for buyers. More competition means potential price appreciation for sellers is likely to be diminished.
January 2014’s Note
Working on January’s Note. I’m going to do everything I can to keep this one under 1500 words.
This should be a fun note.
If you’re interested, I’d welcome your subscribing. (note that subscribing is a two-step process)
Fighting FUD – Charlottesville Real Estate Market in 2014
FUD: Fear, Uncertainty and Doubt. There’s going to be a fair amount of that in 2014, and more than ever, it’s going to take real estate consumers (and real estate pros, for that matter) more effort to distill the good information from the bad.
2013 is over. 2014 is here. Goodie. Reflecting on my “6 Things to Watch in 2013,†I’m satisfied that the six things were on point, and all six points – Quality Inventory, Home Prices, Fewer Distressed Sales, Confidence in the market, buyer frustration and a lot more apartments – will carry forward into 2014.
I’ve been practicing real estate since 2001 and each year i’ve said that the market is interesting and different – it’s one of the reasons I continue to practice; every day is a new day with new things to learn.
I’ll be posting individual stories on these “topics to watch in 2014†over the first two weeks of January:
– QRM – Qualified Residential Mortgages (note that many of the rules have yet to be written). Will it be hard or harder to get a mortgage in 2014?
– Interest Rates – will they go up or down or stay flat? This speculation always brings uncertainty into the market
– Inventory – I predict there will be more – more resales and more new construction
– (Un)Employment – this is going to be a key factor in the Charlottesville MSA
– Home prices – Up, down, flat? Can sellers sell? Can buyers afford to buy?
I’m going to touch on these as well in my January monthly note, which, based on feedback, has proven to be equally valuable to those actively in the buying/selling process as well as those who bought years ago and remain in Charlottesville.
All told, I think Lauren at the Newsplex accurately quoted me in her story last week, and what I said well captures 2013 entering 2014:
“For Charlottesville/Albemarle we’re going to see a mix of cautious optimism and optimism,†says Jim Duncan, partner at Nest Realty. …
“This is going to be the second year where a lot of sellers are going to be able to have the legitimate conversation about whether they can sell and not lose money and that’s going to be a real shift in our market,†says Duncan. “I think that’s going to bring on more inventories which are going to be more competition for sellers and more choices for buyers.â€
…
“Fewer people in the market are under water, meaning that they are able to sell and not lose their down payments or their savings,†Duncan explains.
…But as many people continue buying homes in 2014, the amount of renters will also rise.
“We’ve seen people who used to buy now choosing to rent, because they don’t know if they are going to be here for more than four to five years,†says Duncan. “I think there has been a reevaluation of what it means to buy a home.â€
Finally, my words from last January remain true:
My advice to my clients, whether they are buying or selling, (sounds silly, I know) starts with listening. Where are they now (in life, jobs, homes), where do they want to be (see previous notes) and where can they get realistically?