Friday, November 12, 2010

Virginia Housing Development Authority Update on Charlottesville Area Real Estate Market Conditions and Trends

Barry Merchant, the creator of the following data sets, is a Senior Analyst with the VHDA.  This material was presented to the Charlottesville Area Association of Realtors.  The November 11, 2010  update is posted here courtesy of RealCentralVA, and the February, 2010 version is included, below, for the sake of comparison.  

Some highlights:

1. Slide 5: The shocking expected plunge in Third Quarter home sales, on tax credit expiration, wipes out any hope for continued sales gains.  Supply far exceeds demand. 
2. Slide 17: "...the foreclosure problem is far from over." Locally and nationally. 
3. Slide 20: "...the impact of distressed inventory could extend well beyond 2012."  "Distressed" as in foreclosures, short sales, and strategic defaults. 
4. Slide 25: "Increased affordability is still needed in Charlottesville to sustain increased sales."  Charlottesville MSA is most expensive "downstate" area, rivals Alexandria and Arlington in Median Price-to-Income ratio for home purchase. 
5. Slide 9: Anybody connected to MJH, UVA, and city/county/state workers, plus the housing industry, retail, restaurants, and other services, will likely see tough times in 2011-12. (Bubble Blog interpretation of the data.) 
6.  Slide 30:  Be careful of catching a falling sword.  Prices will continue declining for years, and mortgage rates will remain low for the foreseeable future.  Folks may find it necessary to buy a house, but it's not an investment.  (Again, that's the Bubble Blog interpretation).
Barry Merchant's Presentation to Charlottesville Area Association of Realtors - 11 November 2010

VHDA Presentation, Feberuary, 2010
Review of Regional Market Conditions and Trends

Quantitative Easing 2 Explained

The video at this link explains the absurdities of Quantitative Easing 2 - What it is, and why it won't work--the 'last refuge of failed empires and banana republics.'  It's worth watching the whole thing. From CreditWritedowns.

Charlottesville Police Officer Facing Foreclosure - Can You Help?

The DP has the story of an officer who is seriously ill and facing imminent foreclosure on his home.  The Charlottesville Fraternal Order of Police has reached out, as have others.  Any donation will help.  You may send a donation to c/o President, FOP, Thompson-Hall Lodge #5, PO Box 241, Charlottesville, VA  22902.

Wednesday, November 10, 2010

October 2010 Blows: Charlottesville Sales Down 67% yoy, Albemarle Down 22% yoy, and Area Inventory Highest Since 1990

It's not the time of year:  it's the economy.  Local and National.  And  in this area, the issue remains pricing.  There simply aren't enough jobs here to supply the demand needed to re-balance the market.  Additionally, the "Double Dip" in the national housing market has begun.  In the coming months, more sellers  are going to take this guy's advice.

Nest Realty has all the poor performance details for the Charlottesville Metropolitan Statistical Area, which includes City of C'ville, and the counties of Albemarle, Fluvanna, Louisa, Greene, and Nelson.  2010 is shaping up to be worse than the Great Recession year of 2009.

*Total Sales MSA 2010: 137
*Total Sales MSA 2009: 197
* = a drop of over 28%

*This is the fourth straight month that sales have been down, since expiration of Homebuyer Tax Credit on April 30, 2010, with sales closed by June 30, 2010.

*Charlottesville Total Sales Oct 2010 - 9 Single Family, 1 Townhouse, 1 condo
*Charlottesville Total Sales Oct 2009 - 34
 * = a drop of over 67%

*Albemarle County Total Sales Oct 2010 -54
*Charlottesville Total Sales Oct 2009 - 69
* = a drop of over 22%

*Inventory levels in City of Charlottesville = 32 months
*Inventory levels Albemarle County = 22 months
*Inventory in MSA: 20.8 months

*This is the highest inventory for an October since 1990
*October 2010 represents the highest inventory since February 2010

Local RE sales are low suck, and there's nothing to indicate that, absent more $$ Homebuyer Tax Credits or mortgage interest rates at 3%--or cash raining from the clouds--sales are going to pick up any time soon.  

Read the narrative at Nest RealtyShield Your Eyes 

- The Short Answer to This Question is "No."  The Longer Answer is "Not in the Charlottesville MSA, nor in the rest of the United States." 

-"The New Normal" - A Multi-Part Series Examining Local and Nat'l RE Issues

- The Third Quarter Market Report
- The Second Quarter Market Report
- The First Quarter Market Report

Here's what the National Double Dip in Housing looks like, via Zillow:

The following charts are via/copyright Nest Realty Group.  Click for larger image.  Go to NRG for even larger version.  

City of Charlottesville Home Sales

Albemarle County Home Sales

Charlottesville MSA Home Sales

"For Sale Sign" image copyright CNN Money.

Monday, November 8, 2010

Price Reduced Again: Patricia Kluge's "Albemarle House" Asking Price Slashed Another 50% to $24 Million

From $100 Million in October 2009, to $48 Million in February 2010, to $24 Million November 2010.  It remains the priciest property in Albemarle County, and one of the priciest in the United States.

See the listing under "Price Reduced" at Trulia.

The Kluge Estate Winery is facing $35+ Million in foreclosures,  and Kluge also faces a personal lawsuit related to the loans.  Additionally, Kluge is said to owe Albemarle County $86K in property taxes.

Photo copyright WSJ.

Friday, November 5, 2010

The New Normal - Part IX: Millions of Dollars Owed in Delinquent Property Taxes to CIty of Charlottesville, Albemarle County

Albemarle is owed more than $5 million, while Charlottesville is owed more than $1 Million, and Augusta County is owed more than $4 million.  Each total is about 1% of the locality's budget, according to NBC29.

Patricia Kluge tops the Albemarle list with $86,000 in back taxes owed on Kluge Estate Winery, which has massive $35+ M foreclosure filings and personal lawsuits against it. 

Halsey Minor tops Charlottesville's list with $62,000 for the failed and in-bankruptcy Landmark Hotel, which hasn't seen work since 2009.  Of course, this is "chickenfeed" compared to the $13 Million Minor owes California.

In Augusta County, packaging giant MeadWestvaco, which has laid off workers in the Commonwealth, owes $57,000.

Others on NBC29's list include ChVille Realty Corp, Bailey House, Parham Construction, Belvedere Station (Hauser), New Era Properties, Frank Pearce.

Read: Story and lists of Top10 delinquent tax payers by localities.

The New Normal - A Multi-Part Series

Thursday, November 4, 2010

The New Normal - Part VIII: There Are 9 Years of Housing Inventory Owned By Banks - Must Sell For "Recovery" To Happen

Yes, that's right, according to the WSJ, it would take 107 months to sell banks' current and shadow inventory of foreclosed homes.

Recently, some Realtors and agents have been viewing the Fraudclosure crisis as a way to prop up prices on "traditional" sales--if the foreclosures are off the market, a buyer who needs a house right now has no choice but to go "traditional sale."  However, banks actually listed 15% more foreclosures in October 2010 than September 2010.

Read at WSJ and Mish.
The New Normal - A Multi-Part Series

The New Normal, Part VII: Quantitative Easing II Is In Place Through End of 2011

The Fed is going to assist in impoverishing future generations and drive America into Depression spend $600+ Billion to buy up Treasuries,  in order to "stimulate" the "disappointingly slow" economy.  Many agree this is not enough.  It will, however, boost stock prices.  And it will keep mortgage interest rates low for quite some time.

Others say this move will just be an outright failure.  For the hard numbers and graphs, see these two posts from BI: The Fed's moneyprinting hasn't worked thus far, and it's unlikely to work through 2012 because it won't stop devaluation and deleveraging. The latter points out (among many other things) that residential real estate is currently valued at $18.8 Trillion.  Estimated value in 2014: $13.8 Trillion, a decline of $5T or 26%.  Somebody has to take the writedown.... 

The New Normal - A Multi-Part Series

Wednesday, November 3, 2010

The New Normal - Part VI: House = Republicans, Senate = Democrats. But So What? People v. Corporations is the New Paradigm

The Big Picture's Barry Ritholtz explains it.  He also articulates the lost opportunity to effectively rescue the economy and regulate big banks in "The Tragedy of the Obama Administration." 

The New Normal - A Multi-Part Series

Tuesday, November 2, 2010

Thank You For Your Service and Commitment, Congressman Tom Perriello

May God Bless You, the Commonwealth, and the United States of America.  CNN's projection, 9:00PM EST.

Read This Before You Vote Today, November 2, 2010

The 5th District Congressional race is key.   What are the candidates' positions on The Fed?  For that matter, what's your position? The Fed is at least as important to your wellbeing as healthcare or taxes.

For a brief history and description of The Fed's function, read this ("What is the Fed?" begins a few paragraphs from the top). Then read Charles Hugh Smith, below, on what the Fed's done for you lately.