Archive for the ‘General’ Category

A little over a week ago when I heard NAR was revising their national data, my immediate reaction was… so what? I commented to a colleague that if I challenged them to find an agent with a client that referenced national data when making a home buying or selling decision, they would have a difficult time locating one. I have never had a client reference this data.  I assume there is going to be a lot press surrounding these numbers. While these numbers are going to change, and the numbers of sales is going to decrease, I don’t think it really matters to the overall market. This conversation is far too local and we have far better data available to us in our local MLS. For example, when we tally the numbers, we are going to see more homes sold in 2011 in Albemarle and Charlottesville than did in 2010.

Here is some commentary on this topic from VAR and CNBC for reference.  The data will be release on December 21. (Tomorrow at the time of this post.)

It’s important to understand your segment of the market. I gain a lot of my insight into the marketplace through my relationship with Piedmont Realty and Construction. Understanding the new home market is vital to understanding the overall market. 2011 is going to go down as the worst year in homebuilding since they started keeping records 48 years ago. The number of homes built in 2011 will be just 14% of the number of homes built in 2004. 6 out of 10 privately held home building business that were in operation in 2004 no longer exist.

Piedmont Realty and Construction launched in 2009. In 2011, they will contract for over 70 homes and close over 70 homes in this calendar year. This is truly remarkable and incredibly relevant to our market.

A lot has changed since 2004. The business model is different. Demand has changed. Construction methods to achieve energy efficiency is here to stay. We take orders for new homes now and speculative building is all but gone. I think this is a good thing. I gain an incredible amount of knowledge and insight in to this market by being exposed to all of those sales. Each sale is a tremendous amount of market data. Why did they choose to build? What was the floor plan type chosen and why? What features are most important? What locations are in demand and why? I could go on and on. The order for a new home is the leading edge of demand in the market place. I balance that against my analysis of the resale market and my experience helping buyers in seller in the overall market.

If you are interested in buying or selling in the Charlottesville area real estate market, I am interested in that conversation. Feel free to contact me if you would like to learn more about my approach to helping my clients make the best decision possible in the context of their situation.

In 2005, I was on the front lines of the condominium conversion business model that swept through the Charlottesville area. I worked with the developer and attorney for Webland Park to convert those rental homes into condos. Mid-way through that project Hessian Hills was converted to a condominium community. Demand was strong and sales occurred at a rapid pace. Before the market cooled off many more apartments were converted to condos in the area. Several projects still have many units still available from their original conversion. During these years I learned a tremendous amount about condominium ownership, and maybe more importantly, condominium financing.

When somone purchases an attached or detached home, we refer to that as fee simple ownership. That is, you are buying the land and the home just happens to be attached to it. When purchasing a condominium, you are buying the “unit” as defined by the governing instrument and you collectively own the land as a member of the condominium. As I said, this is a very different type of real estate ownership.

I strongly encourage anyone considering purchasing a condominium to do their homework.   I would recommend staying informed if you currently own a condominium as well. The availability of financing has always been at the core of the conversation. The Virginia Association of Realtors has released a good article on this topic. Check it out here. 

This is a complex topic. Feel free to contact me if I can be of assistance.

If you haven’t been to Belvedere in a while, you might be surprised at how much has occurred in the past two years. Phase 1 is nearing build out and the community has really changed a lot. Charlottesville Tomorrow has just written a very nice summary of where things stand with Belvedere. Check it out here.

Barry Merchant has visited us for a few years now and always provides insightful analysis. His analysis is one of the few I have found that focus primarily on the Charlottesville area and other regions around Virginia.

Barry Merchant Presentation OCT 26, 2011

The quarterly report on our area real estate market is out. CAAR 3rd Quarter Market Report

There is not a lot of big news in this report. Our market has been meandering along for a few quarters now and we are seeing a continuation of those trends.

1. Inventory continues its slow decline. It’s hard to identify a direct cause. Some are waiting, some are renting, etc.

2. The pace of sales year over year is relatively constant. See report for exact numbers.

3. Median price continues to be seasonal and trending lower year over year.

While we often refer to this market as the new normal, I personally believe there is still pent up demand in the marketplace and sales activity is lower than what I think will experience when we get past all of the hardship caused during the recession.   The tough part of the equation is determining the pent up need to sell. I meet a lot of people who would like to buy or sell but just can’t make it work right now.

 I continue to watch distressed sales and new home sales a percentage of the overall market. For the immediate Charlottesville area closed sales through September, short sales and foreclosures represent 16% and new homes represent 15%. Year over year the distressed sales have slightly increased (+2%)as a percentage of all sales and new homes (-2%) have slightly decreased.  Basically, the banks and builders are getting 3 out of 10 sales in the area. (Charlottesville, Albemarle, Fluvanna, and Greene) I think watching these percentages and they way they are trending is important to understanding our market. 

This market is very local and very personal. Whether you are considering buying or selling, take the time to fully understand your options in your segment of the market. I talk to people every day who think they know what is going on, but have not really looked closely at the data and/or comparable sales.

Piedmont Realty and Construction hosted the BHG Real Estate III Team in their new model home in Spring Creek earlier this week. It was a chance to hear the latest on the community and the area. A lot has occurred in the past year.

The first homes of Spring Creek were completed in 2006. From 2007-2009, top sales were in the $600k range and the top year for sales was 2008 with 52. Since then, this market has settled into where I think it will be for a while. There are just two builders active in Spring Creek now. Ryan Homes and Piedmont Realty and Construction.  This community is still relatively young so the majority of sales are still new home sales. Since JAN 2010:

Ryan Sales 16 Median $257,000

Piedmont Sales 21 Median $372,000

From my vantage point, Ryan Homes is chasing a lower price point per sq ft. Piedmont Realty and Construction is selling a more energy efficient, custom home that is appealing to home buyers choosing to live in this area.  The top of this market is in the $400′s now causing some difficulties for those who spent $500k+ a few years ago. Well designed, quality built, energy efficient homes are in demand in Spring Creek. One level living is very popular as well.  Spring Creek is approved for 1200 residential homes.

The golf course continues to be recognized as one of the best in the area. It was shared that a major golf publication has ranked this golf course the number one residential community course in Virginia for 2012. 

Outside of the gates in the immediate area, commercial growth continues. The Spring Creek Business park now includes UVA Health System currently under construction on their new facility. The retail space is anchored by Wal-Mart and Lowes. New business like Arby’s and Sheetz are opening soon and a new strip mall is on the horizon.

Take a tour of The Fairview here. Visit it during the Parade of Homes the first two weekends of October. Feel free to contact me for more information on the area.

The 2011 BRHBA Parade of Homes is just around the corner. This is a great time to get out and see what’s going on in the new home market in the area and to learn more about the latest trends and construction practices.  Energy efficiency continues to be a driving factor with potentional new home buyers. I’ve always believed that understanding the new home market really helps gain insight into the overall market. There’s no better way to understand what’s happening than to go out and see for yourself.

Piedmont Realty and Construction has now completed their first entry for this year’s parade. This home is located in Spring Creek. If you can’t wait, it’s open now Tuesday-Sunday 11-5. Otherwise, the parade is October 1st and 2nd/8th and 9th this year. I’ll post more information here as it is available.

Here’s a blog where Piedmont shared construction progress, floor plans, and final photography of this new one level plan. Feel free to contact me for a private showing or a conversation about the Charlottesville area real estate market.

The Fairview.

Model Home Now Open Tues-Sun 11-5

I’ve been collecting energy costs for two homes now for 7 months.  When I have a full calendar year of data, I plan to break down the cost differences of the two homes I am following. One is a new home by Piedmont Realty and Construction built to its Earth Friendly standards. The other was built in 2000 before energy efficiency became a trend in housing.

To recap, see original post here.

EARTH FRIENDLY HOME A: Built 2010, 3400 finished sq ft, Two zone Trane HVAC, (Zone 1 gas furnace), tankless gas water heater. This home also has a finished space over the detached garage with its own electric HVAC system not run full time.

NON-EARTH FRIENDLY HOME B: Built 2000, 2995 finished sq ft, one zone electric HVAC system, traditional electric water heater.

I look forward to the results but felt compelled to share the findings of the last 30 days. It has been really hot.

Earth Friendly Home A: Average thermostat setting 74. July Va Power bill $171

Non-Earth Friendly Home B: Average thermostat setting 80. July Va Power bill $345.

One of the points I try and make with people interested in this topic is that this is not just about saving money. Its about the overall comfort of the home. A more comfortable home is more enjoyable on a daily basis. Home A is larger and was kept at a much cooler temperature for the month and had half the power bill of Home B.

Its also not just about the insulation. Its about the windows, and maybe most importantly, the quality and sizing of the HVAC system.

As always, feel free to contact me if you are interested in this topic.

The following information is from the CAAR MLS 8/1/11 and the Charlottesville Area includes Cville, Albemarle, Fluvanna, and Greene.

July contracts were up 25% (152/190) year over year for July for the area. All areas sawan increase except Fluvanna. (Slight decrease)  For perspective: 2007=213 2008=173 2009=202 2010=152 2011=190

Year to date year over year, contracts for the area have pulled ahead 3%. (1353/1388)

Some key points to note:

1. 11% of these contracts were short sale or foreclosure. Up 50% since last July, but lower than the average from 1st half of the year.

2. Condo/attached sales were up 115%. (19/41)

3. I pull inventory numbers on the 7th of each month to eliminate the unnatural drop of listings expiring at month end and coming back to the market over the next several days.

This is just a snapshot of July.  I would imagine there will be more sales reported this week and  some of these won’t make it to settlement. Regardless, this is just to give you an idea of one of the many ways I evaluate this market. I customize analysis based on the needs and goals of my clients. This market looks very different to buyers and sellers and can vary across price points and locations in our area.