But a commenter named Craigger summarizes the education level and the feelings of many local buyers as he describes this market and puts it in a national context:
Increased buyer activity is good news for realtors! Feb has seen a 50% increase in sales MoM!
Sounds impressive, until you realize Jan sales were 57, and Feb MTD are 79. Which is down about 66% since last year and even more since the totally bubblicious 06-07 period. Not so great is that current inventory is sitting at MORE THAN THREE YEARS. Plus Jumbo’s are 200bps higher than conforming, and Obama is looking to reduce the mortgage interest deduction for mortgages greater than ~500k. It’s hard to think higher priced homes will not go down 25% in general, with an extra 15-20% possible if the mortgage interest deduction gets polaxed. At least the government will reduce the incentive to waste tax payer dollars on subsidizing more house than any reasonable person would need.
"Craigger" could be one of us--that is, realists instead of optimists.
These are the numbers:
Sold in Cville
Sold in Albemarle
Add the rest of the region:
When compared with January 2008 sales, this is approximately a +/60% drop in YOY; the drop is even wider from earlier years, as Craigger points out.
Nationwide, existing home sales were down 5.3% from December. In the South, they were down over 7%. YOY, they were down over 8%. 45% of sales in January were distressed (foreclosures, short sales), according to the National Association of Realtors. Inventory also declined to 9 months.
These numbers are significantly different than what's going on in this market, as "Craigger" noted, and which as one realtor put it is "essentially frozen."
Current supply in this area is now measured in years. More properties come on the market daily.
Currently for Sale: Charlottesville
Currently for Sale: Albemarle
(All above numbers are most likely +)
In the entire Central VA region, there are about 3,400 properties for sale. Median prices rose more than 70% since 2002 (according to CAAR as well as OFHEO and FHFA). But in many cases prices rose much higher, and don't seem to be striking many buyers as having "corrected" enough.
Posting about an uptick in buyer activity seems to be a response to our Sellers Trapped In Their Homes, and RealCentralVA's own "Learning From the Bubble Blog." Both were followed by many comments from what seemed to be interested but reluctant buyers who believe that prices in this area have not corrected themselves considering large market inventory, global economic slowdown, local economy, credit crisis, and that houses, like stocks, are not going to begin appreciating again for quite some time.
Optimism is great. So is being realistic, practical, and looking at the bottom line, as one recent commenter put it.
See: RealCentralVA Buyer Activity. Calculated Risk for New and Existing Sales and graphs. NAR's press release.