Friday, March 11, 2011

CoreLogic: Home Prices Continue to Decline in the Charlottesville Area

CoreLogic tracks the nation's housing markets. National prices declined 2.5%. The Charlottesville Area* is at -6.72% for January 2011 year-over-year.

95 homes of 2,900 sold in January 2011: sellers had a 3% chance to complete a sale.  Update: Friday PM:  RealCentralVA states that 138 "homes" sold in January 2011, meaning sellers had a 4.6% chance of completing the sale.  A "home" is a condo, townhouse, and single family dwelling.  The website offers sales by County, but doesn't distinguish between property types.  The post also doesn't mention YOY price declines.

The price decline will be even sharper when CoreLogic reports for February 2011: The median YoY price declines were Charlottesville at 38%, and Albemarle at 14%.
From NBC29:

Buyers: Nobody needs a "crystal ball" to understand that on a local and national basis the "asking price" is not the offer price or selling price. A buyer needs to be prepared to stay in the home as prices continue declining. 

Sellers with equity can price their homes below what a real estate agent will determine is a "comparable" property, and therefore have more of a chance to sell. This strategy is impossible for those who bought in this area between 2004-2010. As of Q4 2010, 30% of Virginia mortgage holders are at or near negative equity. 

*The Charlottesville Metropolitan Statistical Area: Albemarle, City, Greene, Fluvanna, Nelson (CAAR typically adds Louisa).


Anonymous said...

Catch a falling scalpel! Medical Residents as Buyers?! Desperate

Jim Duncan said...

Anonymous -

Thanks for reading. : )

Believe it or not, some people are buying, but certainly not at the numbers that they were a few years ago; that's why I say that buying can be a good decision for some.

Just as renting is the right decision for some, buying is as well.

If you're willing to put your name, or at least a consistent handle to your comments, I'll engage in a discussion.

Who's desperate? Residents? Realtors? Sellers? You?

AliG said...


I am interested in your opinion. If someone is moving to Charlottesville for a 4 year residency, at the end of which they plan on moving away, should they buy or rent?


Jane Doe said...

This is a declining market, Jim. You yourself stated in January that you expect prices to decline by 5-7% in 2011.

That's an optimistic expectation. Nest Realty Group's own double digit YOY decreases for February are here:

Only a carefully-choreographed offer/refect offer scenario keeps prices from tumbling faster than they already are. The majority of real estate transactions are performed by CAAR members in this area.

The average med student has $26k in college debt plus $100+k in medical loans.

When a home value drops just 5%, years worth of mortgage payments are wiped out.

When there's a glut of rentals available, why would a medical resident take on $200- $300,000 more in debt?

Sure, they're medical residents. Most of them are under 30. Nowadays, adolescence lasts until 35.

Be gentle with the kids.

Jim Duncan said...

Jane -

I'm coming back soon, but had to post on this:

"Only a carefully-choreographed offer/refect offer scenario keeps prices from tumbling faster than they already are. The majority of real estate transactions are performed by CAAR members in this area."

Any assumption that Realtors can choreograph such things are absurd. We can't even collectively take good pictures on all the properties in the MLS.


Jane said...

Realtors can't speak out of both sides of their mouths, can they?

Paraphrase from every CAAR Quarterly and Annual Report:

'The only way to know the value of your home is to have a Realtor(tm) perform a comparative market analysis.'

A trade organization can't claim to have the best idea of what homes are worth and simultaneously claim they're not to some degree choreographing the market.

There'd be plenty of lower prices in all market segments (especially the upper end) if Realtors were responding to the basic force of SUPPLY AND DEMAND.

Instead, there is some notion of "value" that no longer exists here, nor anywhere else, that is being applied to properties.

Humpty said...

If the Fed hadn't propped the market for the last 4 years with totally fake rates and FHA loans we would have seen a real debacle. This being the truth doesn't mean we will not see a debacle some time in the future. I don't know what's in store for us as a country. The Fed has indicated it will inflate us out of this but will it work?

So to weigh in on the Jane and Jim debate, I would have to agree with both. I agree with Jane that things will not get better in C-Ville and I agree with Jim that Realtors don't have the power or influence to change sentiment. They have tried damn hard to influence buyer to start buying but it clearly hasn't worked!