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Rappahannock Market Update

Sep. 27, 2011
Categorized in: Rappahannock County

It's been awhile since we've taken a look at the stats for individual markets. So we'll start with the smallest market today, Rappahannock, and then do Culpeper, Fauquier and Prince William over the next week.

The October, 2011 report for Rappahannock County shows mostly discouraging news. The total number of Active Listings is, in my mind, the most discouraging number with a total of 108 properties currently looking for buyers. Of the 6 properties sold last month, one third of them were on the market for over a year. The dollar volume of sales is down 58% year over year. The average sold price is down 44% year over year. Average days on market for the county is now 221, up 118% from where we were in October of 2010. The average list price and average sold price are both down over 40%. There's not much in the way of bright spots there.

The sole bit of good news I can offer is that, as usual in Rappahannock, the volumes are so tiny that it's almost impossible to draw many conclusions from a single month's data. Even year over year, volumes are just too small to compare two months and come to any relevant conclusions.

What I can tell you is that if you look at longer term trends, meaning several years worth of data, you see that average monthly sales are up from the depths of the recession. Now that only means that 6-8 houses sell in a given month rather than 3-4. But for those 3 or 4 homeowners, it makes a difference. Days on market remains high, but not as high as it's been. And, where once we were looking at around 3 years of inventory, at the current pace of sales it's more like 18 months.

There is no way to look at the data and suggest prices are better or firmer, although I suspect they're relatively stable.

If you're selling your home in Rappahannock County, make sure it's in excellent condition. If it's not, be prepared to discount it steeply and still wait a long time for the right buyer.

 

Can Anyone Afford to Buy Here?

Feb. 22, 2011
Categorized in: Local Market Conditions

Housing Virginia has a great tool called Sourcebook that allows you to take a look at the affordability of housing in Virginia by county. And it allows you to look at the data in about a dozen different ways. I've looked at the local counties and it's an interesting picture.

First of all, I think you'll be surprised at the overall affordability of the homes in Culpeper, Fauquier, Rappahannock and even Prince William. The national standard for when a home is considered affordable is if the payments are less than 30% of a family's income. By that measure, all of these counties are easily rated as being affordable. And, renting is cheaper than owning in three of these counties. (Prince William is the exception.)

If you look at the Housing Cost Burden, you'll see that the burden appears to be easing in some of these counties. Prince William is a good example of that. This statistic measures how many households are paying more than 30% of their income in housing costs. Unfortunately, in places like Fauquier County, this number is not only too high, it appears to still be rising. (Although note that the data stops in 2009 for this statistic.)

One of the charts that paints the most dramatic picture of what's happened in our housing markets is the Loan Activity charts. For the most part, each county looks like a giant backwards check mark. Except that the short part of that check mark is pretty darned flat! Prince William even shows some additional declines after beginning to bounce back.

Overall, I recommend taking a good look at these statistics. They will be most helpful to anyone trying to decide whether to buy or rent right now. But they will give any buyer or seller a good snapshot of what our market looks like right now.

March Local Market Numbers

Apr. 13, 2010
Categorized in: Local Market Conditions

It's been a few months since I've written about the overall market stats for the area. So, let's see what's changed.

We'll talk about Rappahannock first for a change. How does it compare to a year ago? 86 listings now compared to 76 then. 6 sales in March 2010 compared to 3 last year at the same time.

Note: Remember, real estate is seasonal and year over year numbers are a much smarter comparison than month to month.

The one Rappahannock statistic that jumps out is the number of new contracts in March. There were 8. That's the highest number of new contracts in one month since August, 2006.

Culpeper has 433 active listings compared to 464 last year at this time. While sales in other counties jumped in March after a couple of slow months, March still looks pretty flat in Culpeper. But the median sales price is up almost 10% year over year. That's 2 months in a row that have shown price increases. If you look over a longer time horizon, it's certainly easy to make the case that prices remain flat to slightly higher. The number of contracts ratified in March is down, year over year, but up significantly month over month. Last year at this time there was an increase in contracts from February to March. As always, I'm reluctant to speculate on what these tiny data points mean, other than to say, stay tuned.

Fauquier County also shows declining inventory, 516 now vs. 556 a year ago. Sales are 73 in March of 2010, a significant increase from the 43 in March of 2009. In fact, you can pick just about any metric you want in Fauquier, including price, and it's up. The absorption rate would indicate a very balanced market. That's slightly misleading since there's little inventory available at the lower price ranges.

Prince William County continues to be the place where the buyers are lining up to buy. As an example, a listing came on the market in Gainesville this morning and by this evening when I tried to take my clients to show it, I was turned away and told it was already under contract. Inventory has dropped year over year from 3079 a year ago to 2595 now. Sales have dropped though, from 750 a year ago to 559. I believe that has more to do with a lack of properties in the lower price ranges rather than a lack of interest by buyers. And inventory is coming on the market at a slower pace. Last year in March 1219 new properties were listed. In March 2010 only 964 properties came on the market. Prices reflect the shortage of inventory. Prices have been climbing in Prince William County for months now.

It's a great time to be a buyer in our area if you don't mind bidding wars and competing against cash offers! It's a great time to be a seller if you are not expecting prices at 2005 levels!

 

 

Healthiest Virginia County?

Feb. 17, 2010
Categorized in: Miscellaneous

There's a new study out showing, by state, how each county ranks in terms of overall health. The factors included are:

Health Behaviors

Clinical Care

Social and Economic Factors

Physical Environment

I think I might disagree with the results. But wide open spaces improve my health more than immediate access to doctors. Apparently that's not a widely held belief!

Fairfax County came in at #1. Prince William county is #10. Fauquier is #21. Rappahannock County is #46 an Culpeper County is #56.

What do you think? Personally I think Rappahannock is a heck of a lot healthier than Prince William!

Disaster Declaration for Snowstorm

Feb. 16, 2010
Categorized in: Fauquier County

A large number of counties in Virginia (and some municipalities) have been declared federal disaster areas and now qualify for government assistance to help pay for the cost of the storm. Here's the declaration from FEMA's web page:

 

WASHINGTON, D.C. -- The U.S. Department of Homeland Security’s Federal Emergency Management Agency (FEMA), today announced that federal disaster aid has been made available to the Commonwealth of Virginia to supplement state and local recovery efforts in the areas struck by severe winter storm and snowstorm during the period of December 18, 2009, to December 20, 2009.

Federal funding is available to the Commonwealth and eligible local governments and certain private nonprofit organizations on a cost-sharing basis for emergency work and the repair or replacement of facilities damaged by the severe winter storm and snowstorm in the counties of Albemarle, Allegheny, Amherst, Arlington, Augusta, Bath, Bedford, Botetourt, Buchanan, Caroline, Culpepper, Dickenson, Fairfax, Grayson, Greene, Hanover, Highland, Lee, Louisa, Madison, Montgomery, Nelson, Orange, Page, Prince William, Rockbridge, Russell, Scott, Spotsylvania, Stafford, and Wise and the independent cities of Alexandria, Charlottesville, Fairfax, Falls Church, Manassas, Manassas Park, Norton, Staunton, and Waynesboro.

In addition, assistance is available to the Commonwealth and eligible local governments on a cost-sharing basis for emergency protective measures, including snow assistance, for a continuous 48-hour period during or proximate to the incident period.

Federal funding is also available on a cost-sharing basis for hazard mitigation measures throughout the Commonwealth.  

The strange thing is that while Culpeper is eligible, Fauquier and Rappahannock Counties are noticably missing from this list. That means while Culpeper county citizens get help with the costs of clean up from the storm, county residents of Fauquier and Rappahannock will bear all the burden. It seems odd to say the least.

I know at the state level the governor has to request this declaration. I'm wondering if the same is true at the county level and Fauquier and Rappahannock simply didn't make that request? If anyone understands the "why" of this I'd be interested in hearing about it!

Rappahannock Land

Dec. 6, 2009
Categorized in: Rappahannock County

Since I've had several recent inquiries from both buyers and sellers about land in Rappahannock County, it seemed like a good time take a closer look at that market.

I've mentioned before that land sales are different than home sales. The prices in that market are typically less elastic. Fewer sellers of land "have" to sell.

There have been 9 land parcels sold this year in Rappahannock County. The smallest was 1.23 acres. The largest was 117.92. This does not cover family transfers of land, of which there are a considerable number in Rappahannock County.

The average price per acre is about $11,000. That tells you almost nothing, though since these nine parcels are so different. A 2 acre buildable parcel sold for about $50,000/acre. The 117 acre parcel sold for just under $10,000/acre, a steal in Rappahannock County. The two 25 acre lots, the minimum acreage required for building in Rappahannock County (unless grandfathered in) sold for $10,500 and $13,000.

Days on market ranged from 7 for a 34 acre lot in Woodville to 344 days for a 25 acre lot on North Poes in Flint Hill.

Land sales are down considerably from 2008 when 16 parcels sold. The average price per acre is down about $600. But, again, because there is such a small sampling and so much variety, the price per acre here is not particularly useful.

What I can say is that small parcels continue to sell at a premium. Lots w/septic permits, good access, good views and water all sell for more.

And, the good news is, perhaps because of the slightly lower prices, we've seen some land parcels go under contract relatively quickly.

If you've got questions about your particular parcel of land, or about land you hope to buy, just let me know!

Tax Credit Local Impact

Nov. 13, 2009
Categorized in: Local Market Conditions

I could take a look in detail at the October numbers for Culpeper, Fauquier and Prince William Counties. But they don't show any shockingly different results or trends. And, I thought it'd be more interesting to take a look at the impact of the First Time Home Buyer Tax Credit in our area.

Obviously, without interviewing every buyer it's impossible to know the precise impacts. But I think it's fair to compare the pace of home buying in each county over the past few months and see how we were doing a year ago without the tax credit and how we've done this year with the credit.

Culpeper is first up. Here are the total sales May through October both in 2008 and in 2009:

 

Month 2008 2009
May 63 43
June 57 57
July 54 42
August 64 53
September 53 65
October 58 49

Hmmm...if anything the volume of sales is lower in 2009 with the tax credit available.

How about Fauquier?

 

Month 2008 2009
May 49 70
June 67 68
July 117 62
August 57 65
September 53 65
October 49 66

The evidence is more mixed here. Was the increase in August, September and October because of the tax incentives?

Here's how Prince William looked:

 

Month 2008 2009
May 724 753
June 834 701
July 866 693
August 838 671
September 934 588
October 841 628

Clearly there was no help from the tax incentive in Prince William County.

I'll do Rappahannock County, just to be consistent, but I'd tell you the results there without even looking:

 

Month 2008 2009
May 3 7
June 4 6
July 2 3
August 5 2
September 1 3
October 4 3

This is Rappahannock County. Trust me, there weren't many first time home buyers in that lot!

The overall picture is not one that suggests the tax credit had any appreciable impact at all. Were a few extra homes sold? Probably. Was it enough to make any appreciable difference in the market? It seems unlikely. The only argument you could make for that would be that the market would have declined significantly without the tax credits. I'd be hard pressed to find data to support that argument. We'd likely have been in the same relatively flat pattern we've seen for some time now.

So, how do you feel about the extension and expansion of the home buyer tax credit now? Is it worth your tax dollars?

2009 Predictions Updated

Aug. 18, 2009
Categorized in: Local Market Conditions

At the end of 2008 I made some predictions about what the real estate market would likely look like for this year.

We've now got enough data from the first half of the year to take a look at how accurate I've been.

First of all, I predicted that the Obama administration would intervene in the housing markets and that this intervention would make a difference in the real estate market locally.

I got this one partially right. They did intervene almost immediately with a moratorium on foreclosures. You could argue about how much it helped, but we did see some let up on the loads of foreclosures coming on the market in the 1st quarter. And I would argue that it gave some mortgage holders time to rethink their strategy. Some of them decided dumping large numbers of foreclosures in the same market at the same time was not all that smart!

But I also anticipated that the adminstration would use that extra time to put in place a real plan to reduce the number of foreclosures. Unfortunately, this administration's plans, like those of the Bush administration before it, have proved inadequate to the challenge at hand.

The one measure that I would say has made a considerable difference in this market is the $8000 first time homebuyer tax credit. There are homebuyers out there buying homes purely because of this incentive. Between that additional demand and the reduction in the dumping of scores of foreclosures, we have indeed, seen some bottoming.

I was partially right and partially wrong on the inventory question as well. I anticipated that while the overall trend would be down, year over year, that we'd see a rise in inventory briefly in early spring, 2009. This is a seasonal pattern and I expected to see what we've normally seen. I was wrong and the decrease in inventory continued, even through the early spring. There was a blip of an increase in Fauquier County. And Rappahannock continued it's tradition of bucking the trend with an inventory that continues on an upward trajectory. But overall, inventories have declined steadily throughout the year.

I suggested prices would stabilize during the summer months. I may still get that right, we'll see. What it looks like right now is price appreciation at the lower price ranges, price stabilization in the mid range and continued price declines in the upper price ranges. The average sold price is down 31% year over year in Culpeper County thus far. The median sold price is down just 11% (close to my prediction of 10%). In Fauquier the average price is actually up an astonishing 45%, with the median sold price down 8.69%. In both of these instances I'd pay a lot more attention to the median number. The average is too easily skewed by large transactions. In Prince William county the average price is down about 5% and the median down 6.67%. But anyone trying to buy a home in Prince William under $400K knows how tough the competition is. Prices are definitely increasing in that market segment.

The number of homes sold for the year looks like it will slightly beat my projections. We're slightly ahead of where I thought we'd be right now. Barring a large drop off, we'll beat my projections, probably by 5-10%.

At this point, nothing I said makes me look like an idiot, always a good feeling! But it's only August!

Want to go out on that limb with me? What are your projections for the rest of the year?

 

June Market Stabilization

Jul. 12, 2009
Categorized in: Local Market Conditions

There is nothing dramatic in the numbers for June. This is good news. The market is relatively stable at this moment.

With the exception of Rappahannock County, inventory remains almost unchanged from May. Rappahannock had a huge jump (for Rappahannock) from 89 to 100 homes for sale. But they also had another good month for sales with 6 homes sold.

In Fauquier, Culpeper and Prince William Counties there was a change of a few properties in the overall inventory. But look at year over year and it's amazing how much we've improved. Prince William has roughly half the inventory it had a year ago. No wonder we're seeing things go under contract in days with multiple offers!

While Fauquier and Culpeper haven't seen the dramatic decrease we've seen in Prince William, each of them has at least 30% less inventory now than a year ago.

As you'd expect, the county with the lowest inventory, Prince William at less than 4 months, shows the most stability in prices. Culpeper and Fauquier both have roughly 8.5 months of inventory and prices still appear to be declining there. But the stats are a little misleading there. Year over year stats show a price decline of approximately 25%. And, while June stats show a price decline over May, the month to month numbers are not very reliable in this category. Because the volume of homes sold in any given month is relatively small, the numbers are easily skewed. Still, prices remain at bargain basement levels.

We are bouncing along the bottom in my opinion, maybe moving up a little in Prince William County. The big question here is still, how long will we stay on the bottom.

I'll be working over the next couple of weeks on a look back at my 2009 predictions and how I'm doing so far. Stay tuned for that and your chance to make fun of my skills as a prognosticator!

May Numbers

Jun. 12, 2009
Categorized in: Local Market Conditions

May proved to be mostly a month where the numbers went sideways.

Whether you're looking at Culpeper, Fauquier, Prince William or Rappahannock County, there are no dramatic changes.

There were some subtle signals that things have slowed down a tad in Culpeper county. Both new contracts and sales actually fell last month.

In Fauquier county inventory actually rose, ever so slightly (3 houses). But sales jumped month over month from 54 to 70, well above last year's pace at this time.

Prince William continued to shed inventory with only 3.7 months of inventory now available. I continue to see buyers discouraged with what they're finding available under $400K in Prince William.

Rappahannock County had the biggest jump in sales with 7 units selling last month. This being Rappahannock and the universe being so small, it appears to be a big jump (SALES TRIPLED!). But inventory is exactly where it was a month ago and we're unlikely to see any sudden movements in this quiet corner of the market.

Overall, signs would still seem to indicate we're at or very close to a bottom. Prince William still looks to be on its way back up with price appreciation. And, with a tiny amount of inventory available, prices there will likely continue to rise throughout the summer months.

Amissville Auction

Jun. 2, 2009
Categorized in: Rappahannock County

There was an auction in Amissville last week. The property that was sold was 16 Lantern Lane, an equestrian facility and bed & breakfast. It features a 4 bedroom, 4.5 bath home on 10 acres. The home was built in 2005.

The property features an 11 stall center aisle barn as well as some fencing for horses.

The home was originally listed for sale in February of 2008 for $949,900. The price was reportedly reduced to $795K at some point. It never sold and was taken off the market in August of that same year.

The auction produced a sale price of $550K. If you look at comparable properties in Rappahannock County (minus foreclosure) they're listed for about $600K to about $1 million. (Granted, the $1 million home has no interior photos.)

Given what I see out there, someone got a good deal last week. That's not always true at an auction. Auctions depend on adrenaline kicking in and people bidding more than they intended.

Since prices in Rappahannock County are less elastic than elsewhere in the region it'll be interesting to see if there's any impact on pricing for these similar properties.

April Market Numbers

May. 14, 2009
Categorized in: Local Market Conditions

April results are in and for the first time in quite awhile we're seeing a small uptick in inventory in most counties. It's not large enough to be a concern at this point. In fact, given that we're in the busy spring/summer season, it's surprisingly small.

In Culpeper there are currently 494 homes for sale. That's still less than we had in January. And it's a huge improvement over the 800+ homes for sale there a year ago. Sales remain strong with 62 homes sold as opposed to 48 last year at this time.

Fauquier remains flatter. Inventory also rose slightly here. There are 569 homes for sale here now as opposed to 556 a month ago. And we're still much better off than April of 2008 when there were 764 homes for sale. But sales aren't much better than a year ago. 54 homes sold in Fauquier County in April. 49 were sold in this period a year ago.

Prince William was the exception to the increase in inventory. It continues to shrink there; good news for sellers, not good news for first time home buyers. There are 2944 homes for sale in Prince William county, roughly half of what was for sale there a year ago at 5880. Sales decreased very slightly month over month: 741 this month vs 750 last month. But homes are still selling much faster than they were a year ago when only 639 sold in April.

Rappahannock County showed a very large jump, from a percentage point of view. There are now 89 homes for sale here vs 76 last month. 27 new properties came on the market, a lot for this small county. That's the highest number of new listings coming on the market in one month in the last four years. But the number of contracts written also jumped to 5 even though sales fell to 2 last month. Large jumps in inventory in Rappahannock previously have resulted in a subsequent withdrawal of many of those listings as people tested the market and then changed their mind about selling. We'll see if the same scenario plays out this time around.

Overall, the market appears to continue to recovery. The only worry here is the seemingly unending stream of foreclosures coming on the market. Between foreclosures and short sales there appears to be no likelihood (except in Prince William) of price increases any time soon.

March Market Numbers

Apr. 14, 2009
Categorized in: Local Market Conditions

Prince William county continues on its headlong pace towards a seller's market. There's now only a four month supply of inventory in Prince William county. And, that's not because there's no inventory coming on the market. 1116 new listings were added last month. Meanwhile, 1200 went under contract. We are seeing many fewer new listings added than a year ago at this time. 1631 new listings were added in March of 2008. Meanwhile, closed sales were at 750 in March of 2009 compared to 502 a year ago. Meanwhile, the average sold price crept up from last month's $204K to $210K this month.

I'm not expecting big leaps in pricing in Prince William county. But given the short supply and the increasing demand I think we'll likely continue to see small gains in prices throughout the spring/summer season.

I'm thrilled at the progress we're making in Culpeper. We're down to 8 months of inventory there. Last year at this time there were over 800 homes for sale. This month there are only 464. Last year in March we sold 42 homes, this year 58. There is a March jump in new listings in Culpeper and the other counties, but nothing like the jump we've seen in recent years. And, as long as the net result is still declining inventory, the indicators seem pointed in the right direction.

Prices are still falling in Culpeper County, but I predict we'll see some stabilization by the end of the season. There are already signs of that in the bidding wars on properties priced under $300K.

Fauquier is moving in the right direction, but more slowly than Culpeper or Prince William. We've still got almost 13 months of inventory in Fauquier County. As in the other counties, the lower priced tier of homes is moving pretty quickly. But there's an awful lot of inventory above $350K that's just sitting. There are fewer foreclosures in Fauquier and, in some sense, that's hurting the market. Many of the buyers out there are bargain hunters. And, the bargains are harder to find in Fauquier County.

Still, the inventory is down to 556 as compared to 734 at this time last year. But unlike Culpeper and Prince William County, Fauquier's inventory actually rose this month compared to last month. That's not unusual for March, but is unusual compared to what's going on around us. Last March 35 homes sold in Fauquier County. This year in March it was 43. Again, we're headed in the right direction, but slowly.

Prices are still falling in Fauquier. The average sales price is $224K now as opposed to $318K a year ago. Fauquier is the hardest county to make a case for price stabilization this year. I don't anticipate stabilization in prices until we get a lot closer to six months of inventory. We may hit that level if we have an extraordinary spring/summer season. For now, my bet is that Fauquier prices remain the most likely to continue to fall.

Rappahannock County shows inventory rising slightly (76 compared to 71 a year ago). New listings were 17 in March of this year compared to 11 a year ago. There was 1 new contract in March and 3 closed sales. Those are typical Rappahannock numbers. This is the county that tends to be more sheltered from the real estate trends in the rest of the area. Prices do seem to still be falling in Rappahannock, although it's hard to identify by looking at the overall trends. And, Rappahannock residents continue to take their properties off the market rather than suffer the loss in value.

Banks Walking Away

Mar. 31, 2009
Categorized in: Foreclosures/Short Sales

According to an article in Sunday's New York Times, it's not just homeowners that are walking away.

Apparently more and more banks are deciding some properties just don't have enough value to be worth the foreclosure process. When you consider that NAR (National Association of REALTORS) has estimated that the foreclosure process can cost a bank $60,000, properties at the low end of the market quickly become more trouble/expense than they're worth.

Of course, if you're a municipality with vacant, deteriorating homes where no one is paying any property taxes, you've got a big problem.

We haven't yet seen much of this in our area. Prince William would, perhaps have been most vulnerable to this with their high volume of low cost condos going into foreclosure. But the prices fell fast enough and demand jumped enough that the problem has been dodged.

There seems to be no chance of seeing this kind of thing in Fauquier or Rappahannock Counties. Culpeper does have some foreclosed townhouses selling below $100,000. But the numbers are very small and there seems to be enough demand in that price range to absorb what comes on the market.

February Market Numbers

Mar. 10, 2009
Categorized in: Local Market Conditions

Final February numbers became available today. There are no startling changes to current trends. Inventory continues to decline. Sales continue to look pretty strong.

Culpeper's absorption rate indicates that current inventory would be entirely absorbed in just under 13 months. That's the best that number's looked in a very long time.  In fact, for the first time in several years Culpeper's absorption rate is higher than Fauquier County's rate. Fauquier County's absorption rate shows it would take almost 16 months to get rid of current inventory. Prince William County stays at an astonishingly low 5 months. And, Rappahannock continues to move along at its own pace!

The biggest surprise to me in this month's data is that we did not see the big jump in new listings that I expected we'd see. Typically this is when you see sellers trying to get a jump on the spring market and inventory starts to climb. And we did see small increases in the number of new listings in a couple of counties. But they were very small increases and sales increased enough that there was no impact to overall inventory.

Sometimes what I see on a particular day is more striking than numbers. Today I was out showing properties in Prince William County. I showed four properties. The first one had already gotten one offer in today. At another property we were greeted by an agent and her clients who informed us that the bank had already accepted their offer. At the third a property that had just gone on the market this week already had cards from 21 agents that had shown it. And, our showing was interrupted by another couple right behind us.

The only property of the four that didn't appear to be overrun with potential buyers was one that clearly had water issues and possibly even foundation issues in the basement.

If you're looking at properties in Prince William County that are under $350K we're back to multiple offers, bidding wars and potential buyers tripping over each other in houses.

Overall, the market seems healthier and I'm pretty optimistic that the number of sales overall will be substantially above 2008. I still don't anticipate a big jump in prices. However, prices in Prince William are likely to increase this year if current trends continue.

Sellers have reason for optimism. Buyers still have a great market, but there's definitely a sense of urgency if you're buying in Prince William County.

 

January Market Statistics

Feb. 16, 2009
Categorized in: Local Market Conditions

It's time to take a look at what the market results for January had to say. And, once again the picture remains positive if you're looking for good sales numbers.

In Culpeper the sales for January dropped by about 50% from the previous month. But lest you think that's a negative, that's still about 30% higher than at this time last year. Inventory continues to shrink, down to about a 16 month supply right now. And, based on the number of contracts written, things continue to sell. This is all good news for sellers. The bad news remains that what is selling is primarily foreclosures and they're selling at a steep discount. The average sales price fell about 40% year over year. And, as long as the foreclosures continue to hit the market, pricing will remain depressed. More on the picture later.

In Fauquier County we see the same kind of patterns with inventory falling to a 15 month supply. Sales fell there in January as well, but again, that may have more to do with the holidays than with any specific market forces. And, the number of contracts written remains strong. In Fauquier sales prices were more stable in January, falling only 4% year over year. That's one month's data so it's too soon to tell if that's an anomaly. With 15 months of inventory I'd be surprised to see any significant strengthening of prices in the short term.

Prince William County is the place to be if you're a seller, but may be becoming problematic for buyers. We're down to a five months supply of inventory. That indicates we've got a pretty balanced supply of inventory there. And, my experiences there bear that out. As I was showing homes this weekend in Prince William, a smaller percentage of what I showed were foreclosures or short sales. But prices are still down significantly, 34% year over year.

Rapphannock County also saw inventory shrink this month, falling to 73 homes for sale. That's a pretty fast turn around from the high of 103 we saw in October. Some of that is attributable to sales, but much more of it is from properties being withdrawn from the market. And, even in Rappahannock County there are foreclosure sales. One occurred just down the road from my house this month.

The real estate market may be about to see some changes, however. In anticipation of the President's announcement on Wednesday of a plan to help the real estate market, many banks have now announced foreclosure moratoriums. The banks include giants such as Citi and Bank of America. And Fannie Mae and Freddie Mac had already announced foreclosure moratoriums of their own. With only five months of inventory available now in Prince William County we may be on the verge of seeing some price stabilization at the very least over the next couple of months. Depending on what happens after the moratorium there's even the potential for some price increases.

If I were buying in Prince William county I'd be tempted to jump sooner rather than later. As I believe this is the best combination of inventory, prices and incentives you're likely to find for the next several months. In Fauquier and Culpeper inventory levels are high enough that I think you could justify waiting a couple of months to see what will happen. And, in Prince William, it's possible that next fall the edge would go back to the buyers again. But that's a little too far out to predict without knowing what actions we'll take from DC.

December Market Statistics

Jan. 12, 2009
Categorized in: Local Market Conditions

The recent market trends continued in December without much significant change. Prices and inventories continue to fall, this month even in Rappahannock.

Prince William county stands out as inventory there is now down to four months' supply. That's astonishing given the state of the overall real estate market, the economy and how many foreclosures there have been. With only four months of inventory it's hard to see prices falling much more in Prince William. But there are probably still some owner occupied properties there that are overpriced.

Leaving Rappahannock aside for the moment, Fauquier has the biggest inventory problem at the moment. They're still sitting with 12 months of inventory. There have been fewer foreclosures there and sellers of non-foreclosures have been unwilling to make the necessary price cuts to compete with what's going on in surrounding counties. But prices in Fauquier are unsustainable, even at current levels. If you can buy a townhouse in Manassas or Gainesville for the same price, or cheaper, than one in Warrenton, you're likely to choose the shorter commute.

Culpeper's inventory continues to drop, slowly but surely. Inventory there is down to nine months. While we continued to see bidding wars on foreclosures in lower price ranges in early December, there's some anecdotal evidence that traffic has slowed in the last two weeks. It'll be interesting to see if January's numbers show any change to current trends.

It's also interesting to note that banks have a lot of additional foreclosures sitting, waiting to be put on the market. I suspect they're still trying to spread those losses over multiple quarters. But it's hard to determine how bad the foreclosure problem still is when you know there's another shoe out there, waiting to drop.

Rappahannock's inventory declined spectacularly in December. Some of that may be people taking their homes off the market during the holidays. And, there were 6 properties that went under contract in December. So, January's numbers may give us a better feel for what to expect going forward in Rappahannock.

The other thing to watch in the next month is what steps the government takes, if any, to intervene in the real estate market. Check this space next month to see what those impacts were.

Rappahannock Price Conundrum

Dec. 23, 2008
Categorized in: Rappahannock County

It can be difficult to figure out what the market is doing in Rappahannock. With 2-3 sales a month, most months, it's difficult to discern trends. And, given the enormous price ranges found in properties in the county, any snapshot is sure to lead to incorrect conclusions.

But I've had a couple of conversations this week with property owners in Rappahannock County that had me wondering about pricing overall. In several instances property owners said they knew their properties were overpriced but they had no intention of lowering the price. They said they weren't "desperate" and could wait out any temporary market downturn.

And, of course, they're no doubt correct. While most homes are both a home and an asset for most families. There are a lot of property owners in Rappahannock for whom the property is more heavily weighted towards asset. It's easier to wait this out if you don't have to sell your property here in order to move on somewhere else.

And, the dollar value of sales stayed relatively consistent this year. A total of almost $16 million sold in 2007. In 2008 that total was almost $14.5 million. What was down significantly were the number of transactions. There were 42 in 2007. It looks like we'll finish with about 30 total sales in 2008.

Meanwhile, inventory has risen pretty dramatically. There were 67 properties on the market at the end of 2007. Today there are about 98, an increase of about 30%. We hit a high at the end of October with 103 properties for sale.

Rappahannock took longer to feel the effects of this downturn. And, in a normal economy with a normal real estate slump, there may not have been much of an impact at all here. But the economic fiasco we find ourselves in nationally has not spared the residents of Rappahannock. There have been foreclosures here as well, with more likely to come. And there's an increasingly long list of people who really do want to sell their properties but can't (at least at their current price).

So, how long does the stalemate last? How long are sellers willing or able to wait for the market to recover. In the region overall I believe it could be 5-10 years before we see property values anywhere near what we saw, say, in 2005. Even if you're not "desperate" how long do you want to hold on?

2009 promises to be an interesting year in Rappahannock real estate! What do you think lies ahead?

 

November Market Statistics

Dec. 15, 2008
Categorized in: Local Market Conditions

The November numbers are out and there are a few interesting things to note.

Across the board, the number of new listings coming on the market is down, inventory is down and sales and new contracts are down. It's not unusual to see a little drop in new inventory coming on the market in November. But I believe that part of this is that we're seeing fewer foreclosures hitting the market. We do not necessarily see a similar drop in contracts and sales in November. So, there are probably non-seasonal reasons for this. One possibility is that fewer foreclosures on the market means fewer properties of interest to the buyers out there. Another possibility is that all the bad economic news out there has some buyers waiting to feel better about their own financial future. A combination of these is the most likely culprit. And, while you may have heard about the recent surge in mortgage apps, most of those are refinancing applications and may not affect sales here in the next month or two.

Culpeper is showing a further drop in inventory to 592 units. That's the lowest number we've seen in over 2 1/2 years. Only 75 new properties came on the market and only 40 were sold. 42 new contracts were ratified. It's interesting to note that the last time inventory was at this level in April of 2006, there were 67 properties sold and 70 new contracts ratified. The inventory in Culpeper is actually a little overstated. There are two new condominium developments in Culpeper that are showing a lot of individual units listed in the MLS. But since there aren't any actual units built yet, the housing units actually in existence is a little smaller. You don't see this in most of the other counties.

Fauquier County shows an inventory decline as well, down to 631. Sales dropped from 49 to 35, but contracts written stayed steady. In Fauquier as well, it's the lowest inventory number in 2 1/2 years.

In Prince William County we're back where we were, in terms of inventory, in early 2007. There are currently 3919 properties on the market. As in Culpeper, all numbers dropped this month, new listings, new contracts and solds. Since Prince William had also been seeing large numbers of foreclosure sales I suspect the decline in those listings is having an effect.

Rappahannock County, having weathered much of the real estate downturn without dramatic changes, is still seeing stubbornly high inventory. It's edged down from its peak of 103 last month to 98 this month. But I expect that we may be stuck around 100 for a few months, at least. Since sales in Rappahannock remain slow, it will take a very long time to get down to a more rational inventory level.

 

October Market Numbers

Nov. 12, 2008
Categorized in: Local Market Conditions

The October numbers continue the good news trend. There are no huge surprises here and no evidence, yet, that the September financial melt down significantly affected our local real estate market.

Culpeper County now has 623 homes in inventory. That's the smallest number we've seen since April of 2006. And the number dropped again from September. The number of homes coming on the market also fell slightly to 109. That being said, remember that this is fairly typical behavior in the fall as some homeowners will pull their homes off the market now and wait and hope for a strong spring market. 58 homes sold in Culpeper in October and an additional 69 homes went under contract.

Fauquier County also has much in the way of good news. There are 690 homes for sale. 110 new listings were put on the market in October, a reduction from the previous month. 49 homes sold, which is slightly less than the previous month. And the number of new contracts written dropped almost in half, from 83 to 43. So November numbers may show a significant drop in closed sales.

Prince William County shows a current inventory of 4222, again the best number we've seen since early 2006. New listings did increase in Prince William County, perhaps as a result of seeing how quickly some listings were selling. New listings in September were 1178 and in October jumped to 1284. Closed sales dropped a little in October from 934 to 841 but are still a huge improvement year over year. And contracts written also rose from 1059 to 1143.

Rappahannock County continues to march to its own drummer. Inventory there is at an all time high of 103. And another 17 new listings were added to inventory during October. There were 4 closed sales in October and three new contracts written. As of right now I wouldn't expect a big improvement in November.

Overall the news continues to be good in terms of the volumes of sales and the reduction in inventory. What won't make most sellers happy is the continued reduction in sales prices. I don't expect any stabilization in prices before spring. And, actual price increases are likely a long way off at this point.

Piedmont Real Estate Blog

Blog by Julie Emery
Amissville, Virginia

An ongoing dialog on real estate news, opinion and trends in Northern Virginia and the greater Piedmont area. Julie is an Associate Broker at Frankly Real Estate Inc, 6304 Crossroads Circle, Ste 102, Falls Church, VA 22044

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