2019 End Of Year Market Report from Michael Guthrie
“I feel confident that the 2nd quarter will show a much more robust real estate market. There are several reasons for my optimism.
- The spring market is here and with it comes increased activity. More homes come on the market which gives those who are looking more from which to choose.
- The weather is better which brings more traffic to existing homes and new home communities.
- The biggest reason is interest rates remain low when all predictions were they would go up. A weird reason for this is the US-China tariff battle. The negative effect of this to the stock market and the economy puts downward pressure on mortgage rates. Some might not like the increase in tariffs with China, but it is a good thing for home buyers.”
Sound familiar? In many ways, nothing has changed over the last 9 months. It was a robust spring market as anticipated but slowed down quite a bit in the late summer/early fall. Thankfully, buyers re-engaged late in the year causing an almost 5% increase in real estate transactions* year over year. The median sales price dropped from almost $300,000 to a little over $290,000. This can be explained when you see how new construction continues to impact the overall market. https://www.cnbc.com/2020/01/02/competition-for-housing-is-so-high-the-spring-market-is-starting-now.html?__source=iosappshare%7Ccom.apple.UIKit.activity.PostToFacebook
Compared to the 5% increase in numbers of homes sold, new home sales increased by 12% (749 to 837). However the new home median sold price decreased from $429,900 in 2018 to $362,000 in 2019.* This is shown by the increased demand for lower priced homes that has increased sales in counties like Greene and Fluvanna. This can also be seen in a static sales market in homes sold over $500,000 (766 in 2019 vs 759 in 2018) and with homes sold over $1,000,000 (120 in 2018 vs 137 in 2019). Hopefully the middle-east tensions will not increase gas prices too much as this could dampen people’s desire to move farther out.
High priced rentals $1400-1700 continue to be built and leased out in and around Charlottesville and the urban core of Albemarle County. It makes you wonder why until you realize there is a significant shortage of homes in close proximity to the city. There are 58 total with just 25 that are detached. There are only 15 that are new construction. This, along with the misconception that you need a big down payment to buy, keeps people renting vs purchasing their 1st home. You can learn more about this by clicking on this link https://wina.com/podcasts/vhda-financing-update/
There has been an increased amount of showings over these 1st couple week of 2020 and loan officer Jay Domenic from Movement Mortgage says there is an uptick of folks wanting to get pre-qualified due to interest rates predicted to remain low. https://www.bankrate.com/finance/interest-rates-forecast/
I will end this article with another quote from the April of 2019 blog post. “Even though things are looking up, Sellers need to continue to price their home smartly and have it in good condition. Purchasers should definitely know what they are looking for and what they are qualified to buy. That way, when the right home comes on the market, they can react quickly.” All of this remains true today.
If you need assistance with buying or selling a home, please reach out via email email@example.com or by calling 434-951-5124.
*Real estate data as of 1/8/2020 and taken from CAAR MLS
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Michael Guthrie, CEO/Broker
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Realtors and New Homes
5 good reasons : Have a pro on your side throughout the process
Buying new construction seems simple, right? Just pick out the floor plan you want, choose the perfect lot, and watch it go up. No sellers to deal with, no unexpected repairs that come up during inspection, no drawn-out negotiations. Right? Not so fast. In any real estate transaction, it’s important to have a professional on your side, even if the process seems straightforward. “Having your own agent provides a sense of security,” says Kristy Weaver, who has bought two new construction homes from two different builders. “It gives you some peace of mind, knowing that someone is looking out for your best interest.”
Peace of mind is just one benefit of having an experienced agent along for the ride. Read on for five more reasons you’ll want a local real estate agent by your side when buying a new construction home.
1. Help you find a reputable builder
“Your agent can rely on their own experience and that of their colleagues to help you find a builder you can trust.” “What’s the quality of the workmanship? What kind of warranty do they offer? What’s their track record of resolving issues? Getting a clear understanding in the beginning can alleviate serious headaches down the road.”
2. Go to bat for you
The timeline for purchasing new construction is typically quite a bit longer than buying an existing home. From the first time you visit the sales center, to choosing your layout, construction, inspections, and finally closing, there are ample opportunities for things to go sideways — think construction delays, permit issues, and financing concerns. An experienced buyer’s agent can help you navigate all of these sticky situations.
3. Help you review your contract
Even if you’ve purchased a home before, the contract for new construction is a whole different animal, and an experienced agent can help you make sure you understand everything, from floor plans to earnest money requirements, deadlines for requesting changes, and timelines for completion. “It’s crucial to have a third party who represents your interests in the transaction,” says an agent who has represented new construction buyers. “A good agent can add the proper addendums to protect you if something falls through.”
4. Assist with negotiations
Buyers’ agents know the areas where you’ll find the most wiggle room when it comes to negotiations. “Builders are trying to keep their sales price up so that the next buyers through the door see the higher closing price.” “They’d much rather throw in closing costs or additional upgrade credits.”
5. Point you toward smart upgrade choices
Builders will offer you endless options for finishes and upgrades, and it’s easy to get overwhelmed. A seasoned real estate agent can recommend the upgrades that will get you the most bang for your buck in resale value, suggest finishes that might be cheaper to do on your own, and help you avoid over-improving, which can jeopardize your appraisal before closing.
Even though a friendly sales representative will greet you with a smile the moment you walk through the door of the sales center, don’t forget that they work for the builder. Bring your own agent with you starting with your first visit — in fact, many builders require your agent to register with them from the very beginning in order for them to be involved in the process and receive their commission.
With a professional you trust by your side, you’ll rest easy knowing someone is there to protect your money, your time, and your new home.
Call 434-951-5155 or email RoyWheeler.Move@gmail.com to get in touch with a local, professional agent today!