A recent lunch with a banker friend got me curious about current prices per square foot in specific local subdivisions. Apparently a builder had recently told my friend that he couldn't build a house (including land acquisition costs) for as little as the current price per square foot on existing homes. If you're a builder, that's trouble!

So, I'm going to do a series of posts, not necessarily sequential, looking at several subdivisions in a local area and what the average sale price per square foot looks like.

First I should define a few things. I'm looking at specific subdivisions because they are more uniform. It's easier to make comparisons without having to factor out the amount of land. They are usually built at about the same time. All in all, they are more likely to result in more accurate comparisons.

The sale price that I'm using is the sold price as taken from the Multiple Listing Service (MLS) minus any money paid by the seller to help with closing costs. So, it's a net sales price.

The square footage information is taken from the tax records. That means that occasionally the square footage is going to be inaccurate if, say, a homeowner finished the basement without getting the proper permits.

All that said, let's take a look at three subdivisions in the Amissville and Jeffersonton area.

South Wales had the largest volume of sales of the subdivisions I looked at with five sales since 1/1/2008. The average price per square foot of the homes sold is $118.89.

Quail Ridge had four homes sold. The average price per square foot there is $110.50.

Wildwood Forest showed only two homes. That makes the data more suspect here as the two homes had enough differences that I don't view this number as very useful. But, for what it's worth, the price per square foot, on average, was $125.91.

I wanted to look at two additional subdivisions in this area, Deerfield and Erinbrook, but there weren't even two sales in either of these (at least per the MLS).

If you live in the Amissville or Jeffersonton area and have a home for sale, you might consider taking a look at how your home compares with these numbers. Is it time for a price reduction?

If your a buyer, keep these numbers in mind as you look for the house you want, then compare the listing price to these numbers.

Sometimes getting more specific about market conditions in individual subdivisions can be an easier way to understand the current market. When you're talking about an entire county and hundreds or even thousands of homes it can sometimes be a little overwhelming. And, of course, real estate is very, very local! Things in one subdivision can be sitting for many months with no activity while another subdivision shows everything moving in less than 90 days.

With that in mind, I decided to take a look at Wildwood Forest. It's a relatively small subdivision, approximately 90 homes, in Amissville in the northwest corner of Culpeper County.

Eight homes have sold in this subdivision in the past year.  The last one sold in September of last year, over 6 months ago. The lowest net price any property sold for was $355,000. The highest net price anything sold for was $508,270. The sold for, on average, 96.5% of their final list price.

During this year period, there were 25 properties listed for sale. Eight of them sold. Three of them remain on the market and the remaining 14 were eventually withdrawn.

Given the rate at which properties are currently selling, there's enough supply here currently for four and a half months. Basically, what that means is that if homes continue to sell at the same frequency they have been selling in this subdivision, and nothing new goes on the market here, it will take four and a half months for current inventory to be sold off.

The fastest anything sold was in 5 days. The longest anything was on the market was 1327 days and that one never did sell. If you throw out the 1327 DOM property (since it seriously skews the results) you get an average days on market of about 90. That actually puts this subdivision ahead of most of Culpeper County.

The three properties currently for sale here range in price from $459,000 to $499,900. Given that nothing's sold in here for six months and that the last sale in here was for $459,900, and given that prices, in general, over that period have fallen, it's entirely possible that current prices are slightly inflated.

I'd be interested to know if you find this kind of analysis interesting and if any of you study specific subdivisions in this level of detail.