First Set Of 2007 Sales Stats for Charlottesville Area
February 12, 2007 | 1 Comment
The first month of the new year is now well behind us. Since the shine has just about worn off of 2007, it is time to take a look at the sales statistics for the Charlottesville area for January. As always, the stats are pulled from the Charlottesville Area Association of REALTORS MLS, and cover the areas that comprise the Charlottesville MSA.
January Sales 2007
January Sales 2006
Breakdown
As I expected, most of the areas are a bit behind the pace of January 2006. This isn’t surprising, given the fact that January 2006 was really the tail end of the banner-year of 2005. The only thing I found surprising was that the number of closed transactions in January 2007 trailed behind January 2004 (132 vs. 154). This is surprising due to the fact that inventory has almost doubled during that time (1879 vs. 1077 on January 30th of each year). As one would expect, this has lead to a marked increase in the Days on Market (DOM) for closed transactions. For the area, DOM has increased by 55%, or 41 days from 2006 to 2007.
Closed transactions were down in every area with the City of Charlottesville once again being the lone exception. Charlottesville experienced a whopping 79% increase in sales in January 2007. The median price decreased in Charlottesville for January, suggesting that sales are still being driven by condo conversions and neighborhood redevelopments. Every other area experienced a short fall– Albemarle -37%, Fluvanna -40%, Greene -54%, and Nelson -5%. Only Nelson experienced a decrease in the median home price, so it doesn’t appear that sellers are being hurt too bad in the wallet.
Over the entire Charlottesville area, sales lagged 34% behind their January 2006 mark (132 vs. 199), while the median price remained virtually unchanged (-1.4%) despite median drops in both Charlottesville and Nelson.
This information just serves to further reinforce the idea that the market we are currently experiencing is here to stay. As DOM continues to increase, it will become imperative that sellers adjust their thinking and price their homes to match market trends. Pricing a home with 15% appreciation over 6-12 months may not be realistic anymore, neither is the expectation of a sale in 15 days. While the market in the Charlottesville area is stable, and prices are not receding, it is something different than what many have become accustomed to, and buyers and sellers should act and react accordingly.
Obviously, we are only 1/12 of the way through the year. Much remains to be seen as the year progresses. The January numbers suggest that there are many trends worth watching in 2007.
[tags] real estate, realtor, charlottesville, albemarle, fluvanna, greene, nelson, virginia, housing statistics, home sales [/tags]
2006 Charlottesville Area Year-End Statistics
January 12, 2007 | Leave a Comment
After some strange MLS problems, I was finally able to compile the year end statistics for the Charlottesville area. I compared them with the report that CAAR published, and noticed that despite all the requests to the contrary, there were still additional transactions recorded in the MLS after CAAR published their report. In light of this, I may wait a full 15 days to report stats in the future.
As always, the stats are compiled from the CAAR MLS and cover the Charlottesville Metropolitan Statistical Area (Albemarle, Charlottesville, Fluvanna, Greene, Nelson).
2005 Year-End Sales Data
2006 Year-End Sales Data
Breakdown
Overall, 2006 was not a bad year for real estate. It wasn’t 2005, but since 2005 was a record year, there is really no room for complaint. Charlottesville outpaced all the other areas, posting a 36% increase in sales. Since the majority, if not all, of this increase was the result of condo sales, it will be interesting to see how the city fares in the first few months of 2007. Every other area saw a decrease in sales– Albemarle -16%, Fluvanna -23%, Greene -18%, and Nelson -36%. Overall, the Charlottesville area experienced a 10% decrease in the number of sales.
The good news is that the median home price is continuing to rise for the area. Interestingly, the positive effect that condo sales had in Charlottesville may have negatively affected the median price, since it dropped 4% in the city for 2006. Every other area saw an increase– Albemarle +11%, Fluvanna +5%, Greene +13%, and Nelson +5%. Overall, the Charlottesville area experienced a 6% increase in the median home price for 2006.
Inventory History
Breakdown
While the months of inventory is relatively high as of the end of 2006 (10.37 months of inventory), the good thing is that the overall number of listings on the market has begun to trend downward. This could mean that while their will still be a healthy selection of homes on the market, it won’t feel so much like there is a glut of homes out there that simply won’t sell. It could also mean that people who were previously “testing” the market to see if they could get the price they wanted, have now come to grips with the reality of the market and are either taking their homes off the market or have actually adjusted and sold their homes.
One statistic that I found interesting was that the percentage of list price has gone down steadily over the last few months of 2006. This again leads me to believe that previously unreasonable sellers have been forced to adjust to this market. The only way to see if this remains true in 2007 will be to watch and see if that number begins to inch upward or at least remain the same in the beginning of 2007.
Final Analysis
All things considered, 2006 was a good year for real estate. Much like the hometown UVA football team, 2006 was a transition year for real estate. Granted, most people in real estate fared better in 2006 than the Cavaliers, but hopefully 2007 will meet everyone’s expectations for yet another solid performance by the Charlottesville area real estate market. As for the Cavaliers, I’m not so sure. . .
[tags] charlottesville, real estate, realtor, virginia, albemarle, charlottesville, fluvanna, greene, nelson, statistics, housing statistics [/tags]
Charlottesville Area November Stats Show Us Market Isn’t All Bad
December 11, 2006 | 1 Comment
Winter is just around the corner, and it is time to take a look at the Charlottesville area market statistics for the month of November. As always, the stats are taken from the Charlottesville Area Association of REALTORS MLS, and the areas represented make up the localities that form the Charlottesville Metropolitan Statistical Area.
November Sales By Area
2006
2005
Breakdown:
In what has beginning to sound a bit like a broken record, every area was down, with the lone exception of Charlottesville (+12%). Albemarle slipped 23%, Fluvanna 41%, Greene 25%, and Nelson 45%. Over the entire Charlottesville MSA, the November sales were down 26% compared to 2005.
One thing that I found curious about the stats was the doubling of the Days on Market (DOM) in Albemarle and Charlottesville from 2005 to 2006. This added a full month to the overall DOM for November 2006.
Year-to-Date
2006
2005
Breakdown:
Again, for the entire year, every area is down except for Charlottesville (+36%). Most of the gains made in Charlottesville have been from condo sales, which may explain the fact that both the average sales price and median sales price actually went down in Charlottesville in 2006. Comparing 2006 to 2005, Albemarle is down 15%, Fluvanna down 19%, Greene down 5%, and Nelson down 48%. Combined, this puts the area 11% behind the record-setting pace of 2005.
The news is not all bad, however. In looking at the median sales price for 2006 compared to 2005, the area is experiencing a healthy price appreciation. Overall, the median price has risen 6% through November of 2006. The median price is up in Albemarle (+12%), Fluvanna (+6%), Greene (+13%), and Nelson (+2%). Charlottesville’s median price has gone down 2% in 2006, probably as a result of the massive increase in condo sales in the city. Price appreciation is a sign of a healthy market, despite the fact that the number of sales may be down.
Inventory History
The following chart shows the inventory history for the same areas (Albemarle, Charlottesville, Fluvanna, Greene, Nelson) in 2005 and 2006:
Breakdown:
November is the first month in 2006 that showed a significant decrease in the total inventory for the Charlottesville area. This brought the figure for Months Inventory under 10 months for the first time since August. Inventory is at historical highs, but the fact that it is going down, during what has traditionally been the slowest time of the year, is a good thing.
Final Analysis
The one aspect of the market that seems to pose the most danger is the inventory. While the overall inventory may be going down, it is rising in some geographic areas and segments of the market. If the inventory rises and sales don’t keep pace, the increase that we have seen in the median home price may begin to slide in the other direction. Every market is going to try to reach an equilibrium where supply will equal demand. If the physical supply is too high, the price of that supply will have to be lowered to a more favorable point.
Sales may be down from the record pace of 2005, but homes are continuing to gain value, which means that 2006 isn’t exactly bad. Both sellers and buyers are simply going to have to adjust their expectations to meet the realities of the current market.
[tags] real estate, realtor, charlottesville, albemarle, fluvanna, greene, nelson, housing, housing statistics, housing sales, real estate sales [/tags]
Charlottesville Area Sales Continue Trend
November 8, 2006 | 3 Comments
Now that the first week of November is just about over, it is time to take a look at the October sales statistics for the Charlottesville area. Since my template seems to suffer from the same malady as the template over at Behind the Curtain, I am releasing the statistics in a little bit different format. I am using screen grabs from the MLS to show you the numbers, and then I have calculated everything else that the MLS does not. Enjoy!
October Sales by Area
2006
2005
Breakdown:
A look at these stats shows us that for October 2006, every locality showed sales below the level of last October 2005. Albemarle sales were 33% lower, Charlottesville was a whopping 63% lower, Fluvanna was 29% lower, Greene was 24% lower, and Nelson was 6% lower. It is safe to say that the boost that condo sales gave the Charlottesville area has now effectively ended.
2006 Year-to-Date
2005 Year-to-Date
Breakdown:
We all know that 2005 was a banner year for real estate. 2006 is good, but not that good. Charlottesville’s sales for the year have increased by 36% (due almost entirely to condos). Albemarle is down 17%, Fluvanna is down 18%, Greene is down 4% and Nelson is down 37%. The good news is that the median home price is increasing. In fact, the median home price has increased in every locality except for Charlottesville. Again, condo sales are probably responsible for that fact. For the area, the median home price has increased 6% in 2006.
As far as inventory is concerned, I don’t put much faith in the Days on Market (DOM) statistic that the MLS reports because there are too many ways that the statistic can be inaccurately reported. It is, however, the only measure of inventory available. As you can see from the charts above, the average DOM has increased across the area. The increase hasn’t been eye-popping, but when you combine an increase in DOM with an increase in listings and a decrease in overall sales, the inventory begins to pile up. According to the MLS, there is was 11.62 months of inventory on the market when November began.
Now that 2006 is almost over, one would think that most buyers and sellers, and all REALTORS, have discovered that the market of 2006 is not the market of 2005. Those that have not come to this conclusion, and therefore are not acting and preparing accordingly, are probably going to be in for a very long 2007.
[tags] real estate, realtor, charlottesville, albemarle, fluvanna, greene, nelson, housing, housing statistics, housing sales, real estate sales [/tags]
CAAR Isn’t Pravda, but Accuracy and Truth Should Rank Higher
October 23, 2006 | 5 Comments
Jeff Brown of “Behind the Curtain” recently posted a very interesting article on truth and accuracy in reporting . His example from Pravda, the official newspaper of the former Soviet Union, was sublime. My opinion is that there should not be a choice between truth and accuracy. Of course, I realize that both truth and accuracy can be subjective at times, but I think that we should always demand both.
The Charlottesville Area Association of REALTORS recently released the “2006 Third Quarter Market Report.” It bears the headline– “On Pace for Second Best Year for Local Real Estate.” Obviously, this caught my attention. One of the reasons it caught my attention was because I wanted to compare their analysis of 3Q06 to my analysis of 3Q06. Plus, this is my associaiton, and I thought that perhaps they had access to better statistics.What I found was woefully disappointing.
A few months back, after I started posting my own market statistics, I decided that I needed to wait a week or so after the end of a month in order to get more complete statistics. I usually wait about a week or so. I could wait longer, but I know that people want information as quickly as possible. From the statistics that CAAR reported regarding the third quarter of 2006, it would appear that they do not share my methodology. All of the numbers that they reported for total sales in 3Q06 were lower than the same statistics that I found. This had the effect of making the percentage changes that they reported actually look worse than what I reported. In the grand scheme of things, the difference in methodology isn’t exactly a big deal. The difference falls within a reasonable margin of error. The only reason that I do it the way I do it is to try and have the most accurate and complete statistics that I can reasonable have.
My biggest complaint with the CAAR market report is the way in which they reported the market inventory. For the first time, I shared the market inventory statistic with you. This statistic shows how long it would take to sell off the entire current inventory. What I reported to you previously was that, according to the MLS, the Charlottesville area currently has just over 12 months of inventory. Compare that with this quote, from the CAAR market report:
One of the major factors that affect the DOM statistic is inventory. If the inventory of homes for sale is low, then there are fewer properties for buyers to consider and properties sell more quickly. CAAR tracks the number of new listings that come on the market each quarter to help us monitor the inventory of available homes. There has been significant growth in the inventory over the last 12 months. As of early October, 2006, our database has 2,992 homes actively listed for sale. That is almost two times the 1,681 homes on the market this time last year. This is a rather amazing turnaround since inventory has been very low for the past five years or more.
Inventory levels have been increasing since late last year, but seem to be leveling off. The rule of thumb is that a healthy, balanced real estate market has a 5 month supply of homes available for sale. Less than that and it is a seller’s market, more than that and it is considered a buyer’s market. For the past several years, we have experienced a strong seller’s market and prices have gone up rapidly. Now, we have about 6.5 months of supply in inventory which indicates we are solidly in a buyer’s market. (emphasis added)
Obviously, this statistic caught my attention. It caught my attention so much that I sent an email to Dave Phillips, CEO of CAAR asking him about the statistic. I explained that I couldn’t find any such statistic in the MLS, and I wanted to know where this one was coming from. Obviously, if 6.5 months is more accurate, I don’t want to tell people that the number is 12 months.
He responded to me very promptly and let me know that he acheived this number by rounding the current inventory to 3000 homes, and dividing it by what he called a “typical October” of 450 sales. Ahhh, there’s the rub.
450 sales in October isn’t anything close to typical. I found this out by looking at the MLS statistical chart that accompanies the “months of inventory” statistic. According to the MLS, the most sales that have closed in any October is 347 sales in 2005 (the MLS only goes back as far as 2003). This number also covers every geographical area in the MLS. I coun’t tell if CAAR was doing the same thing in their report or if they were taking the inventory only from selected areas. Using Dave’s math, using 347 would yield 8.65 months of inventory. Much higher than 6.5 months. The statistic that I used only covered the inventory of specific areas (Albemarle, Charlottesville, Fluvanna, Greene, Nelson), and the MLS divides that inventory by the number of sales in the most recent month (September) in order to arrive at just over 12 months of inventory.
I went ahead and ran the same statistic for the entire MLS, and it said our current months of inventory is 12.19. That is nearly twice as long as the number reported by CAAR. While the CAAR statistic is neither truthful nor accurate, I am not saying that it was done intentionally to mislead anyone. I know that market reports from CAAR aren’t exactly comparable to what was published in Pravda during the Cold War. What happened here was obviously a mistake. Because it was a mistake, that means that it can be corrected both now and in the future.
My problem with the entire situation is that this type of statistical error is completely preventable. In order to publish the other statistics in the report, the MLS must have been used. Why wasn’t it used to publish the “months of inventory” statistic as well? Now, this erroneous statistic has gone out to all the REALTORS in the area, it is published on the CAAR website, and it has appeared in the local Real Estate Weekly. This is not a good thing.
I’m not sure exactly what CAAR can do about the error right now. Perhaps they can publish some sort of retraction and explanation, but I think that it needs to be addressed in this most recent report. In the future, I can only hope that those compiling the report will do so with the dilligence and commitment to accuracy and truth that such reporting demands.
[tags] real estate, realtor, charlottesville, albemarle, real estate market, real estate statistics, housing statistics, pravda, charlottesville real estate market [/tags]
Not Such a Sleepy Little Town
October 20, 2006 | 1 Comment
Consider this:
Yesterday was Thursday, October 19, 2006. It was not a holiday, or any day of any signifcance that I can fathom. On Thursday, Charlottesville played host to all of the following events:
1) University of Virginia football game
2) Itzhak Perlman concert at the Paramount (I went. It was amazing.)
3) Disney on Ice at the John Paul Jones Arena
I know that Charlottesville isn’t exactly top of mind when one thinks of the cultural or entertainment meccas of America; but you have to admit, that is a pretty impressive lineup for a Thursday in October. Charlottesville certainly is not a sleepy little Central Virginia town any longer.
[tags] real estate, realtor, charlottesville, UVA, virginia football, disney, Itzhak Perlman [/tags]
Charlottesville Area Statistics Out– Outlook Sobering
October 9, 2006 | 4 Comments
It is time for the first edition of the Charlottesville area real estate statistics on The Real Estate Zebra. I wanted to make sure to continue to post the statistics because they are important. Since September is now behind us, I am posting statistics for the month of September, the 3rd Quarter of 2006, and the year-to-date. As always, the statistics cover the Charlottesville Metropolitan Statistical Area, and come from the sales as reported by the Charlottesville Area Association of REALTORS MLS. So here we go. . .
Sept. ‘06 Sept. ‘05 %Change
Albemarle 83 154 -46%
Charlottesville 27 37 -27%
Fluvanna 33 59 -44%
Greene 23 27 -15%
Nelson 15 39 -62%
Totals 181 316 -43%
3Q06 3Q05 %Change
Albemarle 466 571 -18%
Charlottesville 191 163 +15%
Fluvanna 149 190 -22%
Greene 66 92 -28%
Nelson 57 119 -52%
Totals 929 1135 -18%
YTD’06 YTD’05 %Change
Albemarle 1294 1570 -18%
Charlottesville 632 438 +31%
Fluvanna 417 505 -17%
Greene 232 238 -3%
Nelson 185 311 -41%
Totals 2760 3062 -10%
So there you have it. The Charlottesville area real estate market is only down 10% in total number of closed transactions as of the end of September. As I have said before, I think that the numbers are a little bit deceiving, in that they are being kept afloat by the number of condo sales in the City of Charlottesville. It will be interesting to see the performance over the rest of the year, since it would appear that those sales are starting to dwindle. This was the first month that the City has underperformed since I have been posting the statistics.
After compiling this information, I decided that I wanted to take a look at Days on Market (DOM). I then abandoned that strategy, since I know how easily the numbers can be manipulated, and I also know that the way they are tabulated leads to them being inaccurate. I just want to get a sense of the inventory on the market. One way of doing this is to do an “absorption rate.” An absorption rate is a statistic that shows how long it would take to sell every home in the existing inventory as long as no additional homes are added. Luckily for me, this is one of the statistics that our MLS provides; it even compares year-to-year. In order to compare 2005 to 2006, I chose the 30th as the inventory date. This meant that I would be looking at how long it would take to sell off the entire inventory of listed homes as of September 30th. The MLS displays this statistic in months, so 3.5 equals 3 1/2 months. What I found was not pretty:
2005 2006
Albemarle 3.71 12.41
Charlottesville 5.46 14.44
Fluvanna 4.20 10.52
Greene 5.44 8.09
Nelson 3.90 18.4
Totals 4.18 12.31
No matter how you look at it, this is a very sobering statistic. According to the MLS, it would take more than 12 months to sell off the current inventory. The lowest total is just over 8 months in Greene County. I knew that the current inventory was high, but the the MLS keeps this statistic going back to 2003, and it is has never even approached this height. In fact, if you exclude 2006, the longest absorption rate for the area is 6.88 months as of January 30th of 2004. All of this means that the market is more competitive than ever before, as the competition is greater, and the sales are fewer. Make sure that you are aware of this before you think about buying or selling your next home in the Charlottesville Area.
[tags] real estate, realtor, charlottesville, albemarle, fluvanna, greene, nelson, real estate market, home sales [/tags]
The Paramount Is a Charlottesville Gem
September 20, 2006 | Leave a Comment
My wife and I, along with our families, attended a performance of the Richmond Ballet last night at The Paramount Theater downtown last night. The performance was wonderful, even though I admit that I know nothing about ballet. This was our first event at the Paramount this year, and it is just one of many that we will be attending.
The fact that the Paramount is in Charlottesville is wonderful for area residents and visitors. It is a great facility, and a great place to watch live entertainment. It took a long time to bring the theater back, and now that it has been back for a few years, the wait was worth it. If you live in the Charlottesville area, and you haven’t been to the Paramount, you need to go. If you are planning a visit, why not plan to catch a show while you are in town? Who knows, you may even see me there. . .
Do You Want Richmond in Your Backyard?
September 1, 2006 | Leave a Comment
Watching the local news last night, I came across this story. It would appear that our legislators in Richmond now find it necessary to dabble in the planning of counties and cities throughout the Commonwealth. You can read the law, as it will be enforced, here.
Any time big government steps in to do the job that it previously had allocated to local governments, there is always the danger of running afoul of the Law of Unintended Consequences. In this case, there is no possible way that those in the Capitol could have possibly considered all the things that affect planning and zoning in Virginia’s counties and cities. From what I can gather of the law, it would appear that the main concern of legislators is population growth and density, and how it affects development. My guess is that this is one more attempt to avoid what many people refer to as "urban sprawl." In case you don’t know what that is like, try visiting anywhere in the DC-Metro area for a few days. . .urban sprawl sucks.
The problem with this law is that the only consideration it gives is to cluster subdivisions. As far as I am concerned, the jury is still out as to the effectiveness of cluster subdivisions when it comes to controlling and directing growth, while at the same time preserving open space and the rights of property owners. In my home county of Fluvanna, for example, the Board of Supervisors approved a rural cluster subdivision ordinance in 2004. It drastically changed the way property could be developed in the county. To date, not one single cluster subdivision has been built. Now, a few are currently in the works, but no one is going to be able to accurately evaluate their effectiveness for at least 5-10 years.
Technical problems with the law aside, this is just bad legislation, if you ask me. I can’t think of even ONE good reason why delegates and senators from places hundreds of miles from my county should have ANY say over the planning and zoning of my county. In my opinion, the planning and zoning of counties and cities should be left up to the people directly affected i.e.– the citizens of those counties and cities. Perhaps the only thing more disturbing to me than the proposal of the law is that it was approved by a vote of 88-8.
People in Orange County apparently share my sentiments, and are planning to circulate a petition to all the county and city governments in the Commonwealth, asking them to voice their displeasure in the law.
Hmmmm . . . where do I sign?
A Moment Of Shameless Self-Promotion
August 30, 2006 | 1 Comment
This site, and yours truly, were recently featured in an article in the Real Estate Weekly, one of the real estate publications for the Charlottesville Area. They don’t have a website, so you are going to have to go "old-school" and download the .PDF here:
Download RealtorsUtilizeTechnologytoMarketHomes.pdf
I thought it was pretty cool, and I hope you do, too.
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Disclaimer
My name is Daniel Rothamel. I am a licensed real estate agent in the Commonwealth of Virginia and a member of the National Association of REALTORS. As such, I adhere to a strict code of ethics and all laws with regard to equal housing, which is reflected in the content of this blog. My broker is Strong Team REALTORS, 86 Joshua Lane, Palmyra, VA 22963; (434) 589-5800. My VA Real Estate License number is 0225 077325. All of the opinions in this blog are mine, unless otherwise noted.
