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Q2 2012 Charlottesville Nest Report

Q2 2012 Charlottesville Nest Report

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Published by Jim Duncan
2012 2nd Quarter real estate market report for Charlottesville, Virginia MSA
2012 2nd Quarter real estate market report for Charlottesville, Virginia MSA

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Published by: Jim Duncan on Jul 11, 2012
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Q2 2012Charlottesville / Central Virginia Region
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Heating Up At The Core
We’ve always said that the local real estate market recovery will start at the core of our market. Based on what we are seeing in themarketplace, our core markets of the City of Charlottesville and Albemarle County are starting to gain a bit of momentum that willhopefully lead to continued positive signs in the local real estate market.Overall, the Charlottesville MSA had a solid Q2. Volume is up and inventory is down - two key components that are great to see. Totalyear-over-year sales were up 2.7% and total inventory fell by 7.5%. In addition, months of inventory also improved from Q2 2011 and fellto 8.76 months of supply. Once again, single family homes continue to lead the way in sales across most sub-markets and attached andcondominium sales are performing admirably.While it’s great to see the overall market creeping back to solid ground, it’s even better to see our core market segments showing stabilityand growth. For the first time since we began running our Quarterly Nest Report in 2009, the five year trend for home sales in AlbemarleCounty is trending in a positive direction. With a 4% increase from Q2 2011, Albemarle has now seen four straight quarters of year-over-year sales increases. Inventory levels are moving in the right direction also with total inventory levels down 3% year-over-year. But...lestwe get too confident, keep in mind that lower inventory is not necessarily a sign of a recovery; there are a lot of upside-downhomeowners who would love to sell but can’t. Until we see appreciation to the point where they can sell, we’re not going to see a truerecovery.The City of Charlottesville continued its hot streak this past quarter. The 154 total sales in Q2 were a 11.6% increase from last year andrepresents the most Q2 sales since 2008. Single family homes in Charlottesville saw a 19.4% increase in closed sales and a 14.9%increase in median prices from last year’s second quarter. Simply put, the Charlottesville real estate market is very active right now. And,yes, inventory levels are down in Charlottesville, too. Overall inventory levels are down to 302 units and 5.59 months of supply. Singlefamily homes are even more scarce in the City: with 196 units for sale and only 4.26 months of supply. (Remember, anything less than 6months of inventory is considered a seller’s market. We’re not quite ready to make the official ‘seller’s market‘ statement, but it’strending that way right now in this market segment.)There’s also a shift in both Albemarle and Charlottesville in that a larger percentage of homes in higher price ranges are selling. Whereassales in the last 24 months have been heavily skewed towards homes in the under $250,000 category, we are starting to see a higherpercentage of home sales in upper price brackets. (See pages 5 and 7 for more details.) This shift is most likely due in part to the returnof move-up buyers to the market, as well as buyers who have been sitting and saving on the sidelines who are finally seeing that now istheir time to buy. With improving market conditions, move-up buyers are now more likely to be able to sell their homes and buy theirnext home.This strong second quarter is also impressive for another reason: sales numbers in Q2 2012 are very comparable to sales numbers in Q22010. What’s the significance? If you remember, the 2010 tax credit boosted sales in Q2 2010. That tax credit, arguably, did not createmany buyers. Instead, it provided additional motivation for buyers to purchase sooner in 2010...thus artificially boosting sales in Q2. Q32010 sales dropped off dramatically because of the tax credit. It’s a great sign that local sales numbers for this past quarter are rivalingthose stats.In closing, we’re beginning to feel more confident that the Charlottesville area real estate market is beginning to stabilize. Obviously, thehistorically low interest rates are helping. While there continues to be some concern with how short sales and foreclosures will affectvalues moving forward, it’s clear that consumers are beginning to gain more confidence in the local and national economies...and arefeeling better about investing their money back into real estate.
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Once again, the overall five year trend for the MSA trends downward...but ever-so-slightly. After years of a fairly significant downward trend, weseem to be seeing a shift towards the positive side, which is great news. Total Q2 sales for the MSA totaled 780, a slight 2.7% increase from the759 total sales in Q2 2011. Sales of both single family homes and attached/condos were up year-over-year. Single family home sales increased2.2%, while attached/condos bounced upward by about 4.5%. Days on Market moved downward by 7.7% to 108 days for single family homes andincreased slightly by 4.5% to 186 days for attached/condos.
Central Virginia/Charlottesville MSA Market Snapshot
Median prices in Q2 increased for both single family homes and attached/condos in the Charlottesville MSA. Single family home prices jumped by5.5% to $290,000, while attached/condos bounced slightly upward by 0.5% from $189,000 to $190,000. Inventory levels continue to fall. This isgreat news. Single family inventory fell to 1820 total units, representing a drop of 5.7%. Attached/condo inventory fell by 14.4% to 465 totalunits. Months of inventory stayed in the single digit territory: there is a 7.98 month supply of single family homes and 6.73 months of attached/condo inventory. Keep in mind that months of inventory levels are typically low in June. Nonetheless, year-over-year inventory levels aredecreasing or staying relatively steady across almost all market segments.
AverageList PriceAverageSale PriceMedianSale PricePrice perSquare FootAvg Dayson MarketTotalSalesTotalInventoryMonths of Inventory
Q2 2012$360,841 $342,800 $290,000 $140.00 108 594 1820 7.98
-0.4% -0.6% 5.5% -1.4% -7.7% 2.2% -5.7% -7.3%Q2 2011$362,183 $344,725 $275,000 $142.00 117 581 1929 8.61
0.5% -0.2% -6.1% -2.1% 9.3% -8.6% -6.5% 12.4%Q2 2010$360,319 $345,365 $293,000 $145.00 107 636 2063 7.66
AverageList PriceAverageSale PriceMedianSale PricePrice perSquare FootAvg Dayson MarketTotalSalesTotalInventoryMonths of Inventory
Q2 2012$215,655 $210,376 $190,000 $139.00 81 186 465 6.73
5.6% 5.9% 0.5% -4.1% 2.5% 4.5% -14.4% 4.2%Q2 2011$204,208 $198,569 $189,000 $145.00 79 178 543 6.46
-10.7% -12.8% -14.1% 2.8% -7.1% -19.5% -6.4% 10.4%Q2 2010$228,597 $227,642 $220,000 $141.00 85 221 580 5.85
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Five Year Trend of Sales Activity (Number of Sales)MSA (Albemarle, Charlottesville, Fluvanna, Greene, Louisa, and Nelson)
02004006008001,0001,2001,400Q3 07Q4 07Q1 08Q2 08Q3 08Q4 08Q1 09Q2 09Q3 09Q4 09Q1 10Q2 10Q3 10Q4 10Q1 11Q2 11Q3 11Q4 11Q1 12Q2 12
   S   i  n  g   l  e   F  a  m   i   l  y

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