With the 2007 Real Estate sales in the books we can take a step back and take a look at what it brought our real estate market, made up of Albemarle, Charlottesville, Fluvanna, Greene, Louisa and Nelson. According to the Charlottesville Albemarle Association of REALTORS (also known as CAAR), the year of 2007 was the fourth highest in our real estate sales history with 3,560 home sales. These figures show that the market is good, however home sales were down from 4,395 in 2006 - a decrease of nineteen percent over all (Albemarle -19.8%, Charlottesville -17.7%, Fluvanna -22.4%, Greene -33.3%, Louisa -16.8% and Nelson -25.5%). What happened in 2007 that caused the numbers to fall? We were seeing comparable sales numbers to those in 2004-2006 until the mortgage business subprime scare occurred. With sales dropping dramatically after that we could not regain our speed to get back to where we had been in 2004-2006. After all was said and done, in 2007 we ended up ahead of 2003 sales which, at the time, was a record year.
With the market needing to be more competitive than in years past prices of homes also shared a similar fate. The median price of homes rose to $6,950 (according to CAAR), which is a rise of +2.6%. Albemarle and Nelson went down slightly (-3.1% and -4.6%, respectively). Charlottesville, Fluvanna, Greene, and Louisa all went up (Charlottesville +16.7%, Fluvanna +3.4%, Greene +6.7%, and Louisa +6.5%). According to Dave Phillips, CEO of CAAR, the reason for such a jump in Charlottesville was that "the city had a lot of modestly -priced condos sell in 2006, which lowered the median price...there was a significant amount of new construction in the city in 2007 with price tags of $300,000-$500,000...135 fewer homes sold this past year, which makes the middle of the market more susceptible to dramatic change. It would be a mistake to assume that real home prices rose 17% in the City".
Over 3,000 homes flooding the market in 2007 also seems to be a reason for the slowing market. Prior to 2007, the Charlottesville/Albemarle area had an average of approximately 1,000 homes on the market. With more homes hitting the market in 2007, homes sat on the market longer, causing a once-stable market to wobble a little. Because of this wobbling, prices saw more negotiating room than in years past. This caused a problem for many home owners. With so much inventory to choose from, buyers finally had the right market to negotiate. However there was a problem for the buyers as well: the mortgage business was upside-down thus making it tougher to get a good rate. Buyers could not find a rate that they needed to purchase a home, which caused homes to sit on the market for up to 150 days, sometimes longer. Pricing also had a lot to do with this. Sellers were used to being told they could get more than their home is worth. For now, that is not the case. But if you are smart and choose a good REALTOR they can still competitively price your home to move (give me a call for a free market analysis 434-409-2213).
Conditions are still favorable for the buyers but, knowing our market, it will not be for long. Buyers take your time, but remember 2004-2006. If you need to negotiate to live where you want to, I would suggest taking a look soon while rates are low, prices are good and the inventory high. Sellers, if you must sell your home now, pricing is more important now than ever. If your home is priced right it will likely sell quickly, but if it isn't,there's no telling how long it might sit on the market.
Eure REALTOR for All Your Real Estate Needs