Friday, April 24, 2009

"The Only Way To Know What Your Home Will Sell For"

From the Charlottesville Area Association of Realtor's 2009 First Quarter Market Report:

The only way to know what your home will sell for is to have a REALTOR or appraiser prepare a comparative market analysis (CMA) for your property. This market is changing very quickly and to be up-to-date, you need to do a CMA every two weeks. Pricing a property correctly is the best way to sell it!

Related Reading:
Cville Area Q1 Sales Significantly Down; Area Median Home Prices; CAAR Report Via BB; DP on CAAR; VHDA Area Economic Data; No End in Housing Downturn; No Bubble - 2006 Hook article

30 comments:

I'll price that for you said...

MLS 464783 Clearly the sellers at 805 Avon St didn't listen to their REALTOR, since they're asking $435K for a house they bought in 2005 for $325. Would a reputable realtor have told them this was a reasonable asking price? Of course not! I'm sorry, that asking price should be at least 20% less than what they paid since they bubbled on it: $261K or less considering its on one of the busiest N/S streets in the city.

MLS 464784,or 5, or 6 -- Anybody need a seller who needs to sell? Same seller asking $245-265K for these houses bought in 2006. Doing the bubble math again knock off 20% and its $200K which is more than generous for these neighborhoods. Around 2002 these places would have been $140K which is much more realistic.

Its not even 2pm and there are 10 new properties listed in the County and 6 in the city. Don't even get me started on the County prices.

ITBH said...

The realtor for 611 Avon is doing bimonthly CMAs apparently. Last summer it was $495K. This year its now down to $399K.

Check your emotions at the door said...

3 separate CMAs were done on MLS 464783 and it is priced less per square foot than the majority in the downtown area. See improvements, upgrades and new features since 2005 on listing.

downtownenvy said...

I am getting to the point where I don't even check the MLS anymore. It's just too darned depressing. House after house just keeps appearing, and the only ones I am ever interested in are way too overpriced.

I think it's time for me to take a time out until September or so. There are a few others who deserve a time out also, but I will refrain from listing their agencies by name:) Ugh.

I'll price that for you said...

@Check your emotions,

you're proving my point. CMA's don't "work." I was kidding when I said that obviously the sellers didn't listen to their realtor. It's obvious that they DID.

Did those 3 CMA show how many existing single family homes in Belmont have sold for over the $400K level in the past year? Not Downtown, but Belmont.

Just one. April 2008. $410K.

Realtors and their CMAs are what's keepin' the bubble alive in the good ole velvet rut of Charlottesville.

michael guthrie said...

This blog seems like it is mostly read by folks who are looking to buy or who truly think they know at what prices homes should sell. Isn't is interesting that Very rarely do you see a seller comment. It sure would be nice for you all to hear from the many sellers whose Realtors told them that their home wouldn't sell at that price but they wanted a higher list price any way. As I have shared in the past, it takes a lot of courage for Realtors to walk away from business and therefore they instead acquiesce to the sellers price vs the Realtors suggested price. I am happy to say more and more Realtors are beginning to take a stand and not take unrealistically priced listings. Unfortunately, there will always be another agent that for whatever reason will. The bottom line point which noone on this blog seems to or wants to understand is the seller always sets the price, not the Realtor. The only decision the agent makes is whether they are willing to market the home at the price the seller decides is their asking price

Anonymous said...

Michael, I agree -- I would very much like to see a post from a seller who found a realtor here who walked away rather than list their property at an inflated price. Where are they??

I can tell you I know one seller who listed with Agent A, and when the term was about up and the house remained unsold, he was hounded by two other very well-known agents who, looking to get the listing, insisted that Agent A had listed the property at too low a price! It's stories such as these that have convinced me that the realtors here are a big part of the problem.

This market is frustrating to buyers because it is so obviously dysfunctional. It's also very difficult to find a buyer's agent who hasn't guzzled the Kool-Aid. As soon as I here the unqualified mantra "it's a great time to buy" I know I'm dealing with someone who knows less than I do -- yet who stands to make many thousands of dollars on any deal I make.

Apparently, there will have to be a long overdue thinning of the realtor herd here. And that is apparently well underway judging from the large number of agents who have recently listed their own homes for sale (at ridiculously inflated prices, of course).

downtownenvy said...

I frankly don't care who is setting prices. What I care about is the fact that the prices in town are STILL too high. I don't go around blaming realtors for this, but someone needs to get a reality check and soon.

A glut of unsold properties are the only result of all of this, so until the sellers ultimately decide to loosen their expectations a bit, many of us will continue to sit on the sidelines.

Anonymous said...

Prices have fallen about 30% in many areas and are back down to 2006 prices according to this article from Reuters. Nevertheless hopes for a spring recovery are fading as feb. and march sales were revised downward

http://www.reuters.com/article/gc03/idUSTRE53M6QV20090423

Prices aren't falling significantly in this area. Inventory keeps rising. What's up with that?

not anon said...

the idea that sellers set asking prices after paying realtors to do CMAs kinda reminds me of the hairsplitting response It depends on what the definition of is is

would love to see a post from a seller or even a comment. doubt it will happen. that realtor who was in the comments the other day had a hard time on his prices.

Anonymous said...

When sellers start posting here it will be a sign that we've finally reached bottom.

Pavel said...

I find it comical that sometimes authors of comments (mostly anonymous) post using harsh/critical tone, yet when the property they feel so compelled to comment about goes under contract there is no any kind of change of tone... only an attitude of: OK.. let's pick on another Realtor/Seller :) The only explanation I see for that is: "seller got lucky" or "buyer must be from out of town and doesn't really GET it".

New Century Mortgage said...

I don't think Realtors and their CMAs are the issue in this market. Massive overleveraged sellers are the issue.
Because housing was so unaffordable here for years, many buyers were forced to take out high LTV loans. You combine that with the amount of refinancing activity that took place as people looked to take advantage of lower interest rates and cash-out on their "equity", and you wonder how many sellers can actually afford to list their properties at anything approaching a fair market price.

Anonymous said...

Pavel, as a buyer I don't know when a property goes under contract. Sometimes they disappear from the listings, but they often reappear a few weeks/months later, or turn up as rentals. I do seriously question whether outsiders are receiving knowledgeable and zealous representation by their buyer's agents in this area.

Buyer said...

Good point, new century mortgage. However sellers who actually can afford to list their houses at realistic prices (which are some who have owned for 12+ years) are listing at the same prices as the overleveraged sellers. Is this because of CMAs? Or what reason?

As a buyer I'm not going to "pay" for somebody else's poor financial decisions.

New Century Mortgage said...

I agree- it makes no sense to pay for a seller's reckless and/or unlucky financial decisions. But just because someone has lived in a property for 12+ years doesn't mean that they didn't use it as an ATM during that period and, as such, are trying to mark up the price in order pay off their accumulated debts.

Pavel said...

Hey Anon. buyer,

Good point about not knowing what happens with a property once it is no longer listed on the public side of CAAR. The most common options (not in any particular order) are: withdrawn, expired, contingent/pending, hold, sold. I have to share with you that I was really surprised when I entered the real estate profession that many of my previous perceptions of real estate agents turned out to be not true. In any case - each buyer has very unique needs....sometimes when I see a property go under contract in MLS the numbers just don't make sense to me and I question the purchaser's decision, but I've learned that it's not just about the numbers. Also, having seen so many properties in good condition going under contract in the $200K-$250K range in Charlottesville, I know there is opportunity out there (even for investors looking to flip properties, yes, I said flip properties, in 2009). Peace.

Buyer said...

Here's an example of what Anon. is talking about: 513 Dice Street "new listing." $315K.

Distinctly remember this one being much more last year. Remember this b/c I was surprised at original price considering neighborhood.

FWIW Pavel: IMO sellers probably *do* have to consider themselves lucky to find a buyer in this market let alone the economy.

Theres clearly not a buyer for every house available. Even the cheap ones. Just doing a quick scan of ''new listings'' and you see theres nearly 100 more in the past 7 days just in Albemarle and Cville.

That's the comical part of the pricing IMO.

New Century Mortgage, it's sad that so many people used their houses as cash machines here and elsewhere.

Elsewhere though lots of sellers have gotten the picture.

Anonymous said...

Pavel
Would you please provide a link to these properties (sold and under contract in March-April) so we can share you optimism?

Real C'ville - The Bubble Blog said...

Pavel,

If you do a quick scroll back through posts that mention individual properties, at least back until January, you'll see that there are:

1. Properties sold for 20%-48% lower than original asking price

2. Properties listed and/or sold by banks at 35+%-50% less than previous transfer

3. Unsold properties

Comical? Probably not the adjective we'd use.

We'll run an "update" post on individual properties sometime soon.

513 Dice street, which Buyer mentions, was listed for $369K last year; $495K including wanted the "yard." Currently has a 15% drop in Asking. Which means offers will be even lower.

611 Avon, another MLS new/old listing that ITBH mentions, has had a 20% drop in Asking. What's the selling price going to be?

New Century Mortgage, thanks for coming on. Overleveraging in all areas--houses, credit cards, cars, even student loans = sad commentary on America consumers.

We get the feeling that buyers reading this blog typically are NOT overleveraged and therefore more annoyed than other consumers at the state of an economy that they were responsible enough not to help damage.

Michael (or Pavel) if you have a seller who wants to do a post, please send them this way: real.cville@gmail.com

Or, for that matter, a buyer. Several of the buyers we've been following have already decided they're going to sit out this season.

Wonder if those who are selling the $200-$250K properties are continuing to make the market move by "buying up?"

Anonymous said...

REALTORS? PLEASE EXPLAIN:

MLS 464906 $525,000

1841 Fendall Ave

Bought 12/08 for $900,000

Assessed at $723,000

If that price isn't a typo, I give it through the weekend on MLS.

Is this the point w/the price?

Anonymous said...

At one point, 1841 Fendall Ave was listed on craigslist for $1.2 million. How strange. The swimming pool must be filled with tequila.

Anonymous said...

What about houses that have sold, or are under contract, at the higher end of the market? Any ideas about asking-sales spreads for the homes that have cleared in Ednam, Colthurst, Rugby, Park St., etc.?

Pavel said...

OK. 40 sold/contingent/pending; status since March 1, 2009. Here is the link:

http://caarmls.com/CAARReports/ListitLib/show_report.aspx?ID=4405834088

40 currently active in MLS for the exact same criteria ($180K-$250K, detached, in the city)

e-mail me on my secondary e-mail: pav128@yahoo.com if you see a house for sale in this price range and you are not sure why it has not sold yet. there are a few active that will not be active for much longer.

If I were selling my own house today I would dislike having my house featured on this blog regardless of positive or negative tone of the post of the author or commentator. I am all for transparency, but someone's candid remark (positive or negative) may emotionally impact a potential purchaser's decision and as a seller I would not want to take that chance. That's just my own personal opinion.

Pavel said...

Yep, since my last comment, make that 41 for contingent/pending/sold and 40 for active (not for long). I knew the number would change pretty quickly from 40 to 41 not because I'm involved in the transaction, but because I know there is a shortage of a particular type of property in the city.

Peace.

Pavel said...

Anonymous, your question: What about houses that have sold, or are under contract, at the higher end of the market? Any ideas about asking-sales spreads for the homes that have cleared in Ednam, Colthurst, Rugby, Park St., etc.?

My response is: each area you describe has very unique properties. I could do a detailed analysis for you of each particular neighborhood just send me an e-mail. BUT in general, since each property is very unique in these established neighborhoods the appeal/price/days on the market/ will vary dramatically. For example: if someone wants to live in Colthurst Farm - the active inventory is very limited. And the current offerings may be on the market longer because a buyer is looking for a home of a different style. It would not make sense to judge the price of a new listing in Colthurst Farm based on the days of the market or list/sold ratio of another listing in Colthurst Farm (the inventory is just not there to make those kinds of analysis. Having said that, neighborhoods which you did not mention with new homes such as Glenmore, Old Trail, etc. are a COMPLETELY different story.

Price Drop said...

Thanks for the update on the low priced houses Pavel.

1. Is anything selling at $300 and up?

2. Beyond $520K?

3. To repeat BB question: Did these sellers buy new houses? Or leave town?

My guess is they're not buying up based on the neighborhoods which include
azalea/camellia (high UVA turnover)
Ridge st
some iffier parts of Belmont and 10th & page

Anonymous said...

Pavel
Thanks a lot for the link.
May I ask you provide the same for Albemarle in 200K-400K price range?

Chi said...

I guess it's good news that the cheapies are selling. Better than nothing.

what you get for $225:

http://www.nytimes.com/2009/04/29/greathomesanddestinations/29gh-what.html?_r=1&ref=realestate

Real C'ville - The Bubble Blog said...

Pavel, Thanks for that link for the $200-$250 properties. Very helpful.

ITBH, 611 Avon Asking dropped to $379K.

Anonymous w/questions about Colthurst, Rugby, Park St, Ednam, etc--Pavel is exactly right about the areas. They're like micromarkets. Are you from out of town? If so, the nuances in these neighborhoods are enormous.

But this is also an issue with CMAs: if a CMA is done using houses w/the same specifications and considering them equivalent...but the neighborhoods are so very very different...well, from a buyer or seller point of view details then get complicated and in some cases difficult to rationalize.