Wednesday, August 31, 2011

Automatic ReFi's Will Delay the US Economy's Downward Slide Until the 2012 Elections Are Over

Here's some Socialism being suggested in an attempt to keep afloat the failing US economy, which used to be based on Capitalism.   How many homeowners would say no to a 4% refi on 'scruples'?  Let's see: Option A: keep paying a 30 yr fixed 6.5% loan on a $350k home (now worth -$280k in City of C'ville, and even less next year) for $2144k/month.  Option B: 4% payments at $1700.

cc: President Barack Obama, Timothy Geithner, Shaun Donovan

Monday, August 29, 2011

Blast From the Past: "10 Reasons There Aren't More Move-Up Buyers" in the Charlottesville Albemarle Housing Market

The bubble blog ran a post in May 2009 titled "10 Reasons There Aren't More Move-Up Buyers."  It's  even more pertinent in 2011, as home sales have declined since then in the Charlottesville Albemarle area.  

As we prepare a market conditions / forecast report for this week, it's one of the posts we've reviewed. And "9 Reasons Home Values Will Continue to Decline in Charlottesville Albemarle" and "C'ville is a Great Place to Rent a Big House For Little $."

With City of Charlottesville sales dropped 42% from June to July, and Albemarle County sales dropped 43% for the same time period, plus Mid-Year Area sales at decade-low levels, many current owners are just staying put.

Friday, August 26, 2011

Blast From the Past: "9 Reasons Charlottesville Albemarle Home Values Will Continue Declining"

C'ville Bubble will have a "market conditions and forecast" post during the week of August 29.  To prep, we looked back at previous similar posts, including this one:

March, 2010: 9 Reasons Charlottesville Albemarle Home Values Will Continue Declining

Next week's post will build on the above list, plus give % declines for price, sales, inventory, and will also include graphs and links.

Thursday, August 25, 2011

Charlottesville, Va: A Great Place to Rent A Big House for Little $

Over at Patrick's Housing Crash site, the only fair purchase price for a house is its equivalent rent.  Since rents and home prices often don't align in this area, especially the higher up in price point you look, the Charlottesville Area is a great place to rent.  (Unless, of course, the "landlord" is trying to make the mortgage payment with rent--then it's a sad story, not a successful transaction, because it's not happening.)

A thoroughly unscientific study--glancing at the ads on a recent Craigslist--leads to the "Cheap to rent a big house in C'ville" conclusion.  Scroll down to see examples.

To do your own research:  1.  Go to Craigslist and check it out.  2.  Then check out houses for sale via mortgage payment here.  See what pops up for the equivalent to the rents on CL. 

But mortgage payments aren't just the price of the house: don't forget interest, homeowners insurance, taxes, annual maintenance, HOA, and mortgage insurance (if downpayment is less than 20%) must be added to the mortgage payment.

*Click on image for larger version in new window.*

HOLLYMEAD (29N near shopping center, on way to Greene Cnty, DIA/NGIC)

GLENMORE (Rt. 250 E of City of C'ville, gated community, Keswick)

REDFIELDS (South of City; large County development S. of I-64)

EDNAM (Development near UVa's Boar's Head Inn on Rt. 250 W of City of C'ville)

NORTH GARDEN (pastoral area south of City in Albemarle Co. on Rt. 29S, easy access to Wintergreen)

GREENBRIER (middle of City of C'ville, easy access to Downtown and Rt. 250 Byp) get the idea.

Purchase Calculators here.

Highly Unlikely, But Fun to Dream. Could Boost POTUS' Approval Ratings, Too.


Wednesday, August 24, 2011

Charlottesville Is 'One of the Best College Towns in the South.' But...

According to Southern Living.   However, the college town happens to be in Virginia.

Low Education Expectations? Virginia is #5 On This Embarrassing List From A National Website

There are explanations given for why No Child Left Behind isn't a good Fed guideline --SOL, anybody?  Nevertheless,  61% of Va's schools and 97% of divisions did not make Adequate Yearly Progress--including many in this area.

Even if the explanations for failure are reasonable, this kind of list is embarrassing and has the potential to drop home values further. 

However, we live in a cute college town.

Other awful lists Virginia is on:
#9 on list of homeowners who owe more than the house is worth
#2 for $ from Federal Gov't...which means austerity is coming our way

Tuesday, August 23, 2011

Charlottesville Area Real Estate: With Mortgage Rates Low For Next *2 Years,* Buyers Are In No Hurry...Unless the Price is Just Right

Pricing has been holding back Charlottesville Albemarle sales (understatement).   Inventory remains high, dropping now due to seasonality, because sellers couldn't or wouldn't lower prices.  Area sales are slow (recent data here and here and here)

But now savvy sellers are trying to get a contract before unemployment and the economy get even worse.

There's a shrinking pool of buyers in this area (see this and this) and sellers who aren't underwater can lower prices faster. 

Price is the key.   The CAAR has been saying this in quarterly reports for several years.  But sellers are taking note now: especially those who tried to "wait out the market" for a couple of years, those who have seen neighbors sold prices, and those who actually have to relocate or are facing foreclosure due to job loss or life circumstance.

Monday, August 22, 2011

Millennials *and* Seniors: Both Are Screwed

Young Millennials will graduate high in debt and self-esteem, but low in work-force skills, and into a Recession. The older cohort is in debt and scared of buying a condo/towhouse/singlefamily.

And Seniors?  They're keeping the jobs that should be going to millennials, and staying put.

Both cohorts are going to have huge, unforeseen impacts on the already troubled housing market.

Read Millennials.
Read Seniors.

Greene County Sees Huge Tax Revenue Boost As NGIC/DIA Lifts Local Spending

35.76%.  Wow.  Meanwhile Albemarle County and City of Charlottesville haven't yet returned to the healthier levels seen during the heyday of 2006.  Read.

Good news tempered by bad news: Home sales and new construction have been under way, but July's home sales plunged, as did median prices for single family units.

Sunday, August 21, 2011

Unemployment Increases Locally and Throughout Virginia

Central Virginia's rate just bumped up, despite this being "tourist" and "recreation" seasons.  And the Commonwealth's rate is at 6.1 for July 2011.  It peaked at 7.2%, where it stayed from December 2009 to February 2010.  Unemployment increased in 28 states, fell in 9, and stayed unchanged in 14.  Read. 

The unemployment rate is likely to keep rising as the economy is forecast to further shrink through the end of the year, resulting in over 10% Nat'l unemployment by December.

Friday, August 19, 2011

Stock Market Tanks, Again, DJIA Ends at 10,817

Below is the 5 day drop.  With global unrest (Israel, Gaza, Tripoli) and the sudden main-stream-media wake-up that the US economy is in a sustained downturn, it could go any direction on Monday/Aug. 22. Image copyright MarketWatch.

Uh-Oh...Virginia is #2 on List of 50 States in Relying on Federal Funding

From The Washington Post:
"The debt-ceiling deal promises that major federal spending cuts are coming, whether or not the congressional "supercommittee" comes up with a deal.  Big federal cuts will invariably squeeze the states, which rely on fereal funds for roughly a third of their spending.  And states that rely most heavily on federal funding could be hit hardest by the Budget Control Act." [ added italics]
The article also notes that states with most reliance on federal spending could also see credit ratings cut--Moody's has already put Virginia on notice.

Read the full article here.  Get the US Census Bureau report in pdf.  Image below is from report.

Click on image for new, larger version in another window.

Thursday, August 18, 2011

Stocks Drop--Again

But this time it looks like the drop is going to continue into tomorrow.

Greene County: July's Median Price Drops 23%, Sales Plunge 48%

This data is for detached, single family homes:

July 2010 median sold price  was $261,500.
July 2011 median was $203,213.

Median price down 23% over last year.
Completed sales plunged 48% from June to July (30 to 16).

Similarly, City of Charlottesville sales dropped 42%, and Albemarle County sales dropped 43%.

Total sales thru end of July for both years in Greene are roughly even.  But as seen by contracts in July, sales are slowing.

In rosier news, DIA/NGIC has given Greene County a huge tax revenue boost: +35.76% with folks frequenting the new Walmart, Lowes, Dunkin' Donuts, etc.

Image copyright and via Charlottesville Real Estate Talk.

Wednesday, August 17, 2011

Falling Prices: "Trulia" Market Snapshots for Charlottesville / Albemarle 22901, 22902, 22903

National real estate website Trulia hosts a lot of local listings, though not all agents choose to use it.  There are differences between the local listing service and Trulia, but data from both show that lower priced listings sell and the mid- and high- ends of market are slow.

[See also: recent data City, Albemarle, Mid-Year]

The additional info in Trulia listings includes  
Below, some snapshots of recent pricing and sales for local properties listed on Trulia.

*Click on image for full version in new window.*

22901 - See summary

22902 - See summary

22903 - See summary

Tuesday, August 16, 2011

How Tough Is It to Sell a House in the Charlottesville Area Market?

 With City of Charlottesville sales dropped 42% from June to July, and Albemarle County sales dropped 43% for the same time period, plus Mid-Year Area sales at decade-low levels, it's a tough time to sell a place.

How tough?  RealCentralVA has an example:
  • "Nice" house 
  • Under $250k
  • Priced less than in 2006
  • on a couple acres in Eastern Albemarle County
No buyer.  And now the sellers are looking for prospective buyers who were interested five years ago.  Read.

But these sellers aren't alone in their difficulty.  A quick spot-check of local listings will show a number of houses listed for less than what the current seller paid a few years ago.  Compare the listing with the previous sale price: City and County. Many of these sales are not "short sales," where the mortgage lender has agreed to take less than what is owed on the property.  These are sales where the seller will lose $$ out of pocket.

Locally and nationally, it's the "new normal:" prices continue declining and home buying demand remains weak, despite historically low interest rates.

Sunday, August 14, 2011

No "Luxury Apartments" For The Shops at Stonefield?

The Charlottesville Albemarle area remains a slow real estate sales market and is currently seeing hundreds of new apartments built.

So what about the "mixed use" development of The Shops at Stonefield? The Hook, in an update on the look of Trader Joe's, says developer Edens and Avant "has reportedly won the option to delete its planned housing component."

Just 3 months ago at groundbreaking for The Shops at Stonefield in Albemarle County, there was still talk that the shopping center at the busy intersection of Hydraulic and Rt. 29 would have "luxury apartments."

While this takes away an impetus for project approval--living and shopping and recreation in the same spot = "green"-- dropping residential plans seems particularly savvy on the part of the developer.  

At left is awesome current photo of the construction site by photographer Bill Emory.

Top image is rendering of the shopping center, copyright Edens and Avant.

Saturday, August 13, 2011

August Reading: This Time Is Different and The Crash Course

In light of this and this and this (let alone locally this and this), here's what's on the night stand.   

This Time is Different 
by Carmen M. Reinhart and Kenneth S. Rogoff

A comprehensive overview of financial crises during the past 8 centuries...and why this time really is the game-changer. 

A condensed abstract of their ideas may be found in this pdf.

Book overview, reviews, comments, info about authors, ordering here at Amazon.

And, if convinced that this time is--really!--different, and wanting to take action, check out Chris Martenson's  The Crash Course: The Unsustainable Future of Our Economy, Energy, and Environment. 

Ordering, summary, comments, here

Don't miss Chris Martenson's website (some content is subscription).

Images copyright Princeton University Press and Wiley/Chris Martenson.

Thursday, August 11, 2011

Whiplash: M -635 T +430 W -520 TH +423

Wow.  Can't wait to see what Friday will bring.

Currently in Stand Off With B of A over Price of Foreclosed Albemarle House, Donald Trump Buys the Bank's Plunging Stock

Albemarle County's most famous property owner (apologies, but true) is in a face-off with Bank of America over the price of Albemarle House.  But he's seeing an opportunity in Bank of America stock as it gets hammered.

30 Year Fixed Rate Mortgage Falls Below 4%

Will lower rates spur purchases? Or just Re Fi's?  This Reuters artice explains why rates are dropping in context of S&P credit downgrade. And  Zillow is reporting the historic low rate of 3.92%.    

Mortgage rates have been down for a couple years now, but Charlottesville and Albemarle sales at the mid-year hovered at levels as low as a decade ago, despite rising population and thousands of new homes built.  Sales nationwide have not been boosted by lower rates.

Most recently, July 2011 sales in the "American Dream" category of the single family home plunged 42% in City of Charlottesville and dropped 43% in Albemarle County from June's sales.  These low sales came at the height of the Spring Selling Season, before the proverbial S hit the F.

30 Yr Fixed rates in the past:
In June 2007, 30 yr fixed was 6.69%
Just after this blog went online in June 2008, rates were at 6.42%
In January 2009, Mitch McConnell (R-Ky) intended to propose 4% rates as part of Economic Stimulus Bill (didn't happen).
In October 2010 rates were at the historic low of 4.16%

Wednesday, August 10, 2011



Dylan Ratigan: Congress Has Been Bought, Banks Have Extracted Billions From American Taxpayers

The man has been saying this for three years now: but more folks than ever know this to be true.  ( There's time to finish a tweet or email during the 30 second ad at start of vid.)

Tuesday, August 9, 2011

The Fed Will Extend ZIRP Through 2013 - Hello, Recession* of 2012

Today marks a historic moment: The Fed announced the continuation of the Zero Interest Rate Policy for two (!) (freakin!) years.  However, this is going to further unravel the American economy. 

 *"Recession"Some Many will call it "Depression."  Global.


After yesterday's plunge, the stock market rallied.  Buckle up.

Monday, August 8, 2011

Charlottesville Home Sales Drop 42% in July

City of Charlottesville home sales have been low/struggling for years now.  The single family sector had a rally earlier this Spring, but as with Albemarle County's 43% drop in July, completed sales of single family, detached home sales from June to July took a dive.  And these were contracts written before this week's chaos.
Chart is via/copyright Charlottesville Real Estate Talk


Stocks crash w/global selloff on worldwide debt crises.

Albemarle County Home Sales Plunge 43% in July

Completed transactions for single family homes fell off a cliff from June to July 2011.  Remember, these contracts were written in May and June--long before the confidence-shakers of the debt ceiling debacle, fears of 2012 Recession, announcement of local rising unemployment, S&P credit downgradeSpring Selling activity was strongest in March and April this year; inventory's high but primarily unappealing.

GRAPH: The blue line of June 2010 indicates the last closings eligible for Homebuyer Tax Credits.  The green line of July 2009 indicates the much higher sales during the depths of the "Great Recession."  July sales declined y/y from 2010 to 2011. Click for larger image in new window.

2011 home sales are bad news for sellers: Albemarle County home sales volume has plunged back 10 years, despite rising population, low mortgage rates, hundreds of new homes built in the past decade.

Numbers sources: here and here.

Friday, August 5, 2011


Unemployment at 9.1% (16.1%) - 117k Jobs Added For 13.9 Million Jobless Americans

See the numbers. 
Charlottesville area unemployment is rising.
Click on image for large versions in new windows.

Main Stream Media Finally Reporting There Was Never Any "Recovery" As Stock Market Plunges 500+ Points

2011's "gains" in the Dow have been wiped out as continuing weak economic data causes jitters hard on the heels of the Debt Ceiling "Deal".   

This collection of graphs outlining Unemployment, Gross Domestic Product, Industrial Production, and Real Personal Income delineate the struggling US economy.

2012 will see another recession.  And locally, unemployment is rising again.

Ironically, due to the weak economy, mortgage rates are at a historic low.

FLASHBACK ONE WEEK: On July 29, the GDP (total amount of goods and services produced in USA) was revised to almost non-existent for Q1 2011, and "barely breathing" for Q2 (sure to be revised downward in the coming months).  Via The White House Council of Economic Advisors:

"Today’s report shows that the economy posted the eighth straight quarter of positive growth, as real GDP (the total amount of goods and services produced in the country) grew, but at only a 1.3 percent annual rate in the second quarter of this year.  The downward revision in the first quarter to 0.4 percent further reflects the slowdown of economic growth due to substantial headwinds faced in the first half of this year. Additionally, the annual revision to GDP showed that the Great Recession – the worst on record – was even deeper than originally estimated.

In this year’s annual GDP revision, the overall downward revision was concentrated at the end of 2008 and the beginning of 2009, so that growth in 2008:Q4 was revised to -8.9 percent from -6.8 percent and 2009:Q1 was revised to -6.7 percent from -4.9 percent. What was already the deepest reported recession since official quarterly estimates began in 1947 is now reported to have been significantly worse."

--Austan Goolsbee is Chairman of the Council of Economic Advisers

Bolding, emphasis = Cville Bubble

While the MSM may be "shocked," the (continuing) Recession (Depression), the Stock Market Correction, rising unemployment, and declining home prices are no surprise to readers of Zero Hedge or The Automatic Earth or The Market Ticker.  These are finance/econ/housing blogs that began on the "fringe" and are now engaging in the most accurate reporting available.