Where is the real estate market today and what can we expect in the future months?
The headlines on the Daily Progress on Wednesday 10/10/2018 stated, “Real Estate Market continues to hum along” https://www.dailyprogress.com/news/local/local-housing-market-humming-along/article_ffdeba4c-ccea-11e8-bb9e-e786ab7dea11.html
The question that comes to my mind is, “Is it really” …
Click on this link https://www.caar.com/docs/default-source/press-releases/caar-2018-third-market-report-final.pdf and you will see that the data shows the good news of homes selling faster and that the median price has once again increased. However, buried in the report is that pending sales decreased in the 3rd quarter of 2018 vs the same time period in 2017. If that trend should continue, look for a not so positive report when the 4th quarter and end of year report is released in January. Another sign that the housing market may be in a correction mode is homes are staying on the market longer than they were 6 months ago. All one needs to do is look at active listings in neighborhoods like Rugby Avenue/Rose Hill Drive, off Locust/Park Street, Greenbrier, Fry Springs and Western Albemarle/Old Trail to see homes that sold right away back in May are not having the same type of activity currently.
Although I am sure not done on purpose, it was interesting to see the pictures used on the https://www.nbc29.com/story/39262498/caar-publishes-2018-third-quarter-home-sales news segment on www.caar.com recently released housing report were of New Home solds. Maybe it is because New Construction has become a significant factor in home sales. Over the last year, new home sales make up over 20% of the area’s home closings. This puts great pressure on existing homes on the market especially as you get into the higher price ranges. As case in point can be made when you look at Greene County. Home sales were up, days on market were down, but median sales price only ticked up a bit (up from $240K to $245K). The reason, builders in the area are very active in Greene keeping pressure on home sale prices.
Speaking of home sale and price increases, when looking at the report noted above, one will see that Louisa prices increased dramatically. A lot of that has to do with new homes being sold in Spring Creek. I think the increased activity in these areas has to do with the higher prices found in Albemarle ($379K) and Charlottesville ($338K). Buyers are having to travel out a bit farther to find a home that they can afford. In addition, like Old Trail in Western Albemarle did years ago, Greene and Louisa have added shopping, restaurants, medical facilities, etc so that residents don’t have to travel into Charlottesville for these services making them more of a community vs a place you live while commuting to work and to enjoy one’s down time.
Another positive sign about the market not included in the report is that there was a 63% increase (22 to 35) of homes sold over $1,000,000. They ranged from $1,000,000 to $8,700,000. The higher priced properties have taken the longest time to recover from the 2006-2012 real estate downturn so it encouraging to see this upward trend.
The most important advice for buyers? Get yourself prequalified with a respected, local mortgage loan officer.
Once you know what type of loan you can qualify for you then want to find an agent who is totally committed to finding you the right home in the price range which you can afford.
Given the current market, the most important advice for sellers?
Put your house in the best condition possible as you may very well be competing with new home construction. Hire an agent who will give you an honest opinion as to what price will get your home sold and will negotiate fervently on your behalf.
Looking to the future?
As noted earlier, Because of the cost of home prices in the city, Charlottesville will continue to expand outward, especially on the southern side of town. Fifth Street Station has created the amenities needed, which will lead more people to want to live on that side of town. Louisa, Greene, and Crozet are doing the same.
Michael Guthrie, CEO/Broker
Roy Wheeler Realty Company