After searching for a home in the Crozet-Charlottesville (Va.) area for six months, Ander and Brenda Martin decided to center their home search on the Waynesboro-Fishersville area of Augusta County.
After spending the weekend driving through eastern Augusta - a thriving sector of the Virginia housing market, the Martins aren’t worried about finding a house they can afford. Now, it’s what house they want.
The Martins aren’t the only home buyers coming down to the Central Virginia housing market from the north. According to a recent study by the Central Shenandoah Planning District, Augusta County likely will be dealing with many more transplants during the next decade.
According to the data Crawford collected from the Virginia Association of Realtors and other state and local agencies, Augusta County real estate could be ready for even more growth.
With Virginia mortgage costs to the north and east significantly higher, “the local housing markets in this region could potentially experience increases in demand and home prices in the future that exceed those occurring in recent years,” one Realtor wrote.
That could mean big things for Augusta County’s housing market. With the lowest average mortgage costs in the five-county region, the local market has nowhere to go but up.
It’s not just working class residents that see Augusta County as a bargain investment. Retirees are on the move as well - a major cog driving the Valley’s housing engine.
It’s a recipe that he predicts will cook up strong sales — and higher home prices — for some time to come, especially as home mortgage rates continue to remain low across the region.
Local Realtors see what’s coming, too.
Despite the recent nationwide housing market correction, real estate insiders say the Staunton-Waynesboro-Augusta County market is still seeing strong growth, both in terms of units sold and the price for which they were traded.
They feel that now is the time to buy.
“(Buyers are) not feeling the pressure to make a decision they may have felt in recent years,” according to Fred Morgan, past president of the Greater Augusta Association of Realtors.
“It’s not like it was a year or two ago. Because there are more homes out there, buyers don’t feel like they have to make an offer immediately to purchase a home because the property is going to be gone. They can take their time to make their decision or see more properties until they find what they really want.”
As good as the getting is right now, local Realtors say the market is getting ready to shift - meaning potential home loan applicants would be wise to get into the game now.
“It’s going to be one of those things where some people will be kicking themselves in six months for not getting into the market,” Morgan said.
“The demand for housing here will not fade. They are coming because the quality of life we have here in the Valley is high and because, when compared with other real estate markets in the areas, ours is still the best bargain. We do not see any changes occurring that will cause that trend to slow down.”
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Posted by Richard Barber on Mar 19 2007 under Virginia
If consumer confidence has the ability to transcend signatures and piles of home mortgage paperwork, then the idea of a Richmond housing market bust may soon be classified as a full-on urban legend.
Sure, the figures are not always encouraging.
According to Virginia Association of Realtors’ numbers, sales of single-family homes fell more than 20 percent in December of ‘06, and 18 percent for the entire year. Many industry pundits called this the dénouement of a five-year housing boom.
But a step back provides some enlightening relativity about the state and future of Virginia mortgage demand: 2006 still marked the fourth highest year on record for home sales in Virginia with 112,699 closed sales (the best year on record was 2005).
And confidence is high.
In fact, according to recent Metro Richmond Survey results, a strong 51 percent of respondents in the Richmond area believe the Richmond housing market is still strong, with 20 percent reporting that its neither strong nor weak and 9 percent unsure. Another 21 percent said the market was weak.
When presented with the latest MRS results, Richmond Association of Realtors‘ Laura Lafayette tempered the optimism with a bit of caution.
“I would say that we are probably even more bullish on the market,” she said.
However Lafayette, RAR’s senior vice president for Public Affairs & MLS, added that the majority of member realty firms have seen a very healthy January, and that the busy spring of home sales is now starting ahead of schedule, at around the second week of January.
“If people price their houses reasonably, they’re going to see them move pretty quickly,” she said.
While Richmonders don’t have the same optimism regarding the housing market six months down the road, the results don’t drop significantly. Forty-four percent of respondents said the housing market would remain strong, while 21 percent said it would be neither weak nor strong and 10 percent unsure.
One advantage those in the Richmond Metro area housing market have is that they don’t need to be too patient with their open houses and listings. According to VAR statistics, homes last year were listed an average of 42 days on market - the quickest market in Virginia.
It’s all the more impressive when this is taken into consideration: according to the Virginia Housing Coalition, median housing prices in the state of Virginia rose 69 percent between 2000 and 2005, while the median household income only increased 16 percent in the same time period.
CONTINUE READING this article on Richmond.com …
Posted by Richard Barber on Mar 02 2007 under Virginia
Yes, you read that right.
New home construction has plummeted in the Richmond area, but David Lereah, chief economist for the National Association of Realtors, says that’s very good news for the long run.
“You want to see construction activity down when real estate is contracting so much,” Lereah said while in Richmond last week. “When the market picks up, it will be that much healthier without a bunch of unsold inventory.”
“Richmond got caught a little in the contraction. It did have some boom. Sales are down. But still, Richmond is looking much better than most areas of the country.”
Job growth in the Virginia city is good. People are migrating to the area. And Virginia mortgage costs, while high, remain relatively affordable compared to some of the nation’s overheated markets.
“The business community is okay, not robust, but it is still a good, local environment for real estate.”
Lereah said it appears 2007 will pan out to be a modest year for growth in the Richmond area real estate market, “which is very good, because the rest of the country is still sluggish.”
That said, the Virginia housing market is not Texas.
Texas missed the boom, so demand is strong there and more housing is affordable, Lereah said. About 75 percent of the country is expanding like Richmond, while 25 percent continues to experience a contraction.
Struggling areas include cities in California, where properties are too expensive for most households, as well as central and South Florida.
“Sprinkle in Vegas, Phoenix, all the boom cities and all the resort towns on the East Coast; they still need a price correction.”
Richmond could be counted among Houston, Dallas, Santa Fe, N.M. - “even Boston and Long Island,” he said. All are showing signs of expansion.
Due to abnormally low Texas mortgage costs, cities in the Lone Star State will do better than Richmond. Richmond will do better than Washington.
“It looks like we have bottomed out or we are close to the bottom for the country as a whole.”
A healthy balance of inventory is a 5 ½- to 6 ½-month supply of houses for sale, Lereah said. For that reason, the national decline in housing starts - a factor that limits the growth of inventory temporarily - isn’t all bad.
The national inventory of unsold homes was 7.3 months in July, meaning it would take that long to sell all the houses. It dropped to 6.8 months over December, showing overall improvement in the housing market.
During the contraction of 1989 and 1990, the nation had 9.4-month supply of unsold houses. In 1981, the supply was 12 months.
“The contraction was a lot less difficult this time around. For the doomsayers to say the market is crashing or the housing bubble will burst, it’s just not true,” said Lereah.
Lereah said he expects traditional investing in real estate - by those who want to buy, live in and hold (rather than try and flip) properties - to get back into the market in 2008.
Speculative investors, who got into the market to make a fast dollar, turned the recent boom into a frenzy.
“When lenders offered exotic mortgage loans, that was fuel for the fire.”
Lenders have scaled back on those loans. Speculative buyers have backed out. And the market continues to correct - in some places, more than others.
SOURCE: Richmond Times-Dispatch
Posted by Richard Barber on Feb 19 2007 under Virginia
The Central Virginia housing market looked a little skewed at times in 2006, but the Lynchburg News & Advance reports it remained stable.
Local real estate agent groups in Central Virginia sold 2,952 homes in 2006, according to December data from the Virginia Association of Realtors.
Closed home sales in 2006 were about a percent lower than they were in 2005, said Wayne Ramsey, 2007 president of the Lynchburg Association of Realtors.
“We are incredibly fortunate here. Our market held an outstanding pace in 2003, 2004 and 2005. There is no segment of the market that held a huge change,” he said.
Ramsey said people in the area are still buying historic homes, new homes and homes they’ve never set a foot in.
“We used to have a seasonal market. We don’t anymore,” he said.
Houses sold in December spent an average of 98 days on market.
Ramsey said for three months in 2006, Lynchburg appeared to have the highest average of days on the market in the state. This was due to condominiums being on the market anywhere from 400-500 days at a time, despite Virginia mortgage costs being relatively effective.
Ramsey said one of those condominiums was incomplete when it was finally sold, which is why it took such a long time to sell.
Lynchburg’s median closing price in December was $157,900, about 13 percent higher compared than last year’s median price of $140,000. The national median price for single-family housing was $221,600 in December.
The cost of mortgage loans is rising in the state as a whole. According to the VAR, Virginia’s average price in December was $274,868, a 4 percent increase from last year’s $269,863.
Many sections of the Virginia housing market grew strongly. Eastern Shore, Martinsville/Henry County, Chesapeake Bay & Rivers, New River Valley, South Central and Southwest Virginia, Greater Augusta and Williamsburg all showed increases in closed transactions for the year compared to last year.
SOURCE: Lynchburg News & Advance
Posted by Richard Barber on Feb 13 2007 under Virginia
16 months.
That’s how long demand for Virginia mortgages has been cooling, as sales have dropped for close to a year and a half straight now. The overall median home price posted growth in the state last month, however, the Virginia Association of Realtors reported.
Realtors recorded 8,351 sales of existing single-family homes last month, down 21 percent from 10,565 in December 2005 - however, the median existing-home price in Virginia gained 4 percent during the period, rising from $192,225 to $199,973.
Melanie Thompson, president of the Virginia Association of Realtors, said the state is in the midst of a buyer’s market:
“… a window of opportunity is open now for buyers to make a great deal at still very reasonable [mortgage interest rates]. We’re encouraging buyers to take advantage of that while the market continues to normalize.”
Homes that sold in December spent an average of 122 days on the market, up from 91 days for homes that sold in December 2005. As a result of the longer market time, fewer owners decided to list their properties for sale in December, waiting for mortgage loan borrowers to grow anxious and begin the bidding process.
For the year, the state’s 112,699 existing-home sales were 18.4 percent below the 2005 level of 138,117.
Despite the cooling, several areas showed increases in closed transactions for the year, including:
- The Eastern Shore
- Martinsville/Henry County
- Chesapeake Bay & River
- New River Valley
- South Central
- Williamsburg
Posted by Jed Moss on Jan 30 2007 under Virginia
In real estate market analyses, of which there are plenty these days as the market is mired in uncertainty, you often hear days on market (DOM) cited as a telling statistic.
This means just what you think it does: the number of days between when a house goes on the market and when the closing takes place - when a seller accepts the buyer’s contract.
The Washingtonian, which features DOM in its recurring Real Estate By the Numbers feature, says that for those looking to buy or sell real estate, DOM is a very important statistic.
In a buyer’s market, the average DOM will be higher because inventory takes longer to sell; conversely, in a seller’s market, the average DOM is lower because homes are snatched up quickly.
This statistics below compare the average DOM in eight Washington-area counties from December 2005 to December 2006. It doesn’t take a genius to see the trend in all eight counties.
The length of time has virtually doubled, which goes to show why Virginia mortgage and Maryland mortgage activity are both down, as are home sales and prices in the areas of both states nearest D.C.
If you are in the market to buy a home, this means you can probably afford to take your time. The days of rapid home price appreciation when buyers put down offers on the spot are long gone. If you are trying to sell, you may have to be patient.
Of course, there are always exceptions. In the greater D.C. housing market, the good locations (read: close in) never seem to go out of style. Here’s a look at eight counties in the area and the DOM change in the past year.
County: Dec. ‘06 / Dec. ‘05
Alexandria: 81 / 35
Arlington : 72 / 36
Fairfax: 97 / 38
Loudoun: 101 / 37
Montgomery: 83 / 38
Prince Georges: 66 / 29
Prince William: 103 / 41
Washington, D.C. 69 36
While it marked a substantial cool-down from the record-setting 2005 year, the real estate market in 2006 turned out to be the second best year for real estate in Charlottesville, Va., history.
“Nobody remembers second place,” said Dave Phillips of the Charlottesville Area Association of Realtors, employing a football analogy. “The second-place finisher in the Super Bowl is still a pretty good football team.”
According to the Daily Progress, there were 4,318 homes sold in 2006 in the Charlottesville area, representing a 7.4 percent drop from the 4,663 homes sold during 2005, according to statistics released Wednesday by CAAR.
Last year was the first time since 2000 that the number of homes sold in the Charlottesville housing market did not surpass the amount sold the previous year.
But rather than a market downturn, 2006 was more of a market correction, said Lori Chapman, a managing broker with Real Estate III.
“We enjoyed the ride, but this is a bit more sustainable for the long-term,” she said.
In the past year, as Virginia mortgage costs exceeded the range in which many buyers could qualify, the Charlottesville market flipped from a seller’s market to a buyer’s market.
Rates have remained relatively low, with 30-year, fixed-rate mortgages at an average of 6.18 percent. The market’s supply also has grown throughout that time, giving buyers more choice and more room to negotiate price.
Eighteen months ago, the market had only 1,100 homes for sale, or roughly four units per buyer. Today, there are 2,504 homes listed for sale in the Charlottesville market, or an estimated 10 homes per buyer.
“Early 2007 is probably a great time to buy,” Phillips said. “The buyer’s market will continue as long as the current inventory stays level.”
Heading into 2007, area broker Michael Guthrie expects the Charlottesville-area market to stay in favor of buyers, but perhaps slightly less so than currently.
“My sense is that you will see a more level playing field for both buyers and sellers, but it’ll be somewhat slanted toward the buyer because of the market’s supply,” Guthrie said.
The median price of a new home in the Charlottesville market during 2006 was $274,900, an increase of $18,900 over the previous year. In 2006, 107 homes sold for more than $1 million.
As people waited for home mortgage loan costs to drop, the number of days a property stayed on the market increased by 16 in 2006. Properties listed for sale were listed for an average of 76 days before selling.
But that’s not necessarily a cause for concern - when it comes to Virginia home sales, the market is considered strong unless the average time it takes to sell a property begins to exceed 90 days, experts say.
Posted by Richard Barber on Jan 12 2007 under Virginia
Gratned, home sales across Virginia slowed for the 15th straight month in November. But low mortgage interest rates and plentiful inventory seem to be drawing buyers back into the market, the Virginia Association of Realtors reported.
According to statistics, there were 7,942 sales of existing single-family homes in November, down 18.4 percent from 9,735 sales a year earlier. However, Richmond Metro, the Eastern Shore, Martinsville-Henry area, Chesapeake Bay & Rivers, Dan River Region, New River Valley and Southwest Virginia all posted sales gains in November compared to a year earlier.
“Buyers are seizing new opportunities in the housing market,” said VAR President Melanie Thompson, of Fredericksburg, “and we’re seeing several areas in the state that continue to show increased activity. Many people forget, in comparing this year’s market to last year’s boom, that figures still show that 2006 will be one of the top sales years on record.”
Thompson said that sellers are now pricing their homes more in line with the current market, as inventory is still running high compared to 2005 levels. Virginia mortgage activity will increase the more this occurs.
As a result, Virginia’s median home price for November gained just 3.1 percent from a year earlier, rising from $209,575 to $216,000.
“Interest rates have remained low, and that creates added affordability for [first-time home buyers],” Thompson said. “Inventory is plentiful, and sellers are accepting market-based pricing. All these factors are creating very favorable conditions right now for buyers.”
Posted by Jed Moss on Jan 09 2007 under Virginia
The University of Virginia provides a buffer for the housing market in Charlottesville from many of the national trends, and does the same for the local economy, according to USA Today’s profile of the Virginia town.
Home sales for 2006 will be the second-best on record, though still down markedly from last year, when Virginia mortgage demand was hitting record highs and real estate activity boomed.
“What’s missing this year is the ton of investor money superheating sales volume and prices,” says Dave Phillips, CEO of the Charlottesville Area Association of Realtors. “That’s why second-home sales are weaker this year.”
Condo sales in the town fell 23 percent, and prices were off 15 percent in November, compared with a year ago, but condos only accounted for about 20 percent of the area’s sales.
As single-family home prices continue to rise, more residents are moving to surrounding counties, such as Greene, Fluvanna and Louisa, in search of affordable housing.
“Louisa is the current hot spot. These small, rural markets are starting to feed Charlottesville’s need for residents and workers,” Phillips said.
There are about 2,600 homes and condos for sale — about a nine-month supply — and about 500 more homes are expected to start coming on the market this month in anticipation of the spring selling season.
In Charlottesville, the median home price is $317,410, making it a bit of a stretch for the average family to afford a mortgage loan. However, that is still less than many of the booming markets up and down the East Coast and in California.
To get an idea of what you can buy for that amount, pictured above is a three-bedroom, 1,500-square foot single-family home currently on the market for $315,000. With current mortgage rates, a 30-year fixed-rate loan would put payments around $1,600 a month, assuming a 20 percent down payment.
Posted by Richard Barber on Jan 03 2007 under Virginia
When fire destroyed Helen Bowles’ home in 2003, Habitat for Humanity stepped up to the plate. Last month the group started construction on a replacement home that will be located where the old one once stood.
In one respect, Bowles was lucky: She still owned the land.
Otherwise, she’d be out of options.
“We can get a house built in probably six months if we just have a place to put it,” Culpeper Habitat President Tom Davis told the Culpepper Citizen, which reported this story December 20. “But that’s the biggest problem we have.”
Property values in Culpeper escalated along with the rest of the Virginia housing market boom. Land once deemed effectively worthless can now bring enormous profits, making many landowners less willing to donate.
The problem has also affected existing Habitat homeowners. Escalating land prices have accelerated county-wide real estate values, leading to property taxes increasing by as much as hundreds of dollars.
Such an increase would strain most households. Habitat families and other low income residents are especially hard hit — their income increases are no match for soaring land values and tax rates. And they’re unlikely to have land of their own for Habitat to develop; owning property would likely make them ineligible for affordable housing assistance.
The problems are especially hard on Culpeper’s Habitat affiliate, formed only seven years ago. Time usually spent spreading the word about their mission has instead gone toward the challenges of a changing economy.
The organization does more than merely build a house. It helps applicants develop budgets, and teaches them to maintain a home. More than anything else, it must stay on top of problems such as rising taxes or homeowner’s insurance. Even a few rough days can throw family finances into chaos.
“For rural areas this is a new problem. Closer to the cities, they have to do a lot of fund-raisers and other things to bring in money to help supplement building a house. We’re getting to that spot too,” Davis said.
“Some Habitat organizations have communities, whereas we’ve had to take what comes to us - a house here, a house there. By the time we got going, around our second or third house, land went through the roof.”
Experts predict a slowing market, but also doubt that will decrease home prices, and thus, the costs of a Virginia mortgage. Expensive homes will remain expensive, and options for organizations like Habitat are dwindling.
The Culpeper affiliate has so far built three homes in Culpeper, with the Bowles home pending as a fourth. Labor is usually donated, material usually reimbursed. It costs $60,000-90,000 to build a home. Once the house is complete, a sale takes place just like any other home sale. Applicants assume an interest-free home loan.
Davis estimated that land can only cost around $20,000 for Habitat to handle the purchase. But they’ve had trouble finding anything less than $50,000. Habitat maintains the right of first refusal - meaning that they get to make an offer before the sale.
Both State Delegate Edd Scott and Senator Ed Houck have met with Habitat representatives on the issue. Both proposed a tax exemption to Habitat families.
There’s one problem though - the state constitution.
Article Ten calls for taxation of all property, meaning that the plan would first need an amendment.
“It doesn’t appear to be a readily available legislative solution at this time,” Scott said. “But both Senator Houck and I are interested. We want to provide Habitat with any tools we can to help them in the work they do.”
Habitat has instead initiated the mortgage refinance for the cash part of the family’s loan.
The rising values in Fauquier County have forced a chapter with 37 homes to shift its focus toward repairing existing homes. Affiliates have suggested values be based on the actual sale cost of the home, rather than the amount of the assessment.
