2015 Real Estate Review-Williamsburg VA

2015 Real Estate Review-Williamsburg VA

Well 2015 came in like a lion, went out like a lioness and in between was anywhere between a rhinoceros and a lemur, at least in the greater Williamsburg market which is the subject of this year end update. All data was gathered using broker metrics and the Williamsburg MLS between 12-14-2015 and 12-18-2015. Please keep in mind this report cover the 3 James City County zip codes 23188-23185-23168 plus the City of Williamsburg. These can be vastly different markets, but James City County accounts for the majority of the data. Call me for a break down that matches your needs specifically! Zip code 23185 can include 3 different localities with vastly different pricing that significantly throws statistics off kilter. York County 23185, James City County 23185 and City of Williamsburg 23185 values are hundreds of thousand dollars different.

The question I get asked most often is “how’s the market?” While I love that question, it is a loaded question. What market are you referring to? Investing, buying, selling or renting? Are you in the market or not? Where are you referring too? Are you asking about today, tomorrow, last month or the whole last year? Here is a market snapshot video from several years ago…

Overall, I have to say 2015 was a very good year. At least for me and my projection at the beginning of the year. I closed 35 sales successfully and had 6 or so fall apart for various reasons. I took on a partner in hopes of capitalizing on missed opportunities like in prior years. I finished the year with 11 active listings so 2016 is looking good so far too. But this was by far, the most complicated, stressful year I’ve had in 13 years. Both buyers and sellers had situations arise that I couldn’t make up. Lenders and the government have caused most of it. Unprepared buyers, sellers and their new or newer agents were frustrating to the end of some deals…and beyond the closing in some cases.

Looking back through the housing correction locally, James City County and the City of Williamsburg, residential sales (attached and detached), for years 2015, 2014, 2013, 2009, 2007,2005 and the year between June 1 2006 and June 30 2007- Presumably the height of the bubble market, but my data shows something different. 2004 is my benchmark and as far back as I can go for data. To really see the market rise and collapse you need to look over several long periods of time. One of the most frustrating things I hear with national broadcast of the “market” is it doesn’t really represents anyone’s real market-it is far too broad and arguably undefined. This 10 year snapshot is critical information for sellers today to establish a perception and a reality balance. It should also help buyers rationalize where things have gone locally over a long period of time. Although just like any product in the supermarket what your money buys varies greatly. Today’s $330,000 house is vastly different from the $330,000 house in 2004!

LOGO 2web I do this for buyers looking to move into Williamsburg regularly to help them realize our market is significantly different than their market typically. Perception is reality right? What happens in Detroit, Washington DC or Las Vegas might have some impact on us locally but it still boils down to supply inventory and demand. Unfortunately we are not making inventory in most cases. Likewise sellers need to understand where we were, where we are. If anyone was really successful at predicting where we are headed, we shouldn’t have ever had a bubble or a financial crisis. So I am very cautious when buyers or investors ask “where will my value be when I decide to sell?”

We ended 2015 (at least through part of December) with a median sold price of $310,000 and average of $339,606 (97.57% of list price at closing). There were a total of 1318 closed residential sales. Almost 20% (279) were sold by the listing agent (likely new construction, dual or designated agency). According to broker metrics there were 248 producing agents for an average production of 5 sales per agent. But that number can be skewed however anyone wants using a variety of data. Any agent can be in the top 1% of agents locally depending on the source and data used! I don’t think the last 2 weeks will have a big impact on 2015 statistics.

Here is how the numbers looked over the periods I mentioned above and how they compared (improved or worsened over the previous periods)

Year                                 Units           Median SP                 DOM                SP/LP                 +/-
2015                                     1318          $ 310,000                     96                  97.57           +5%  2014
2014                                     1221         $ 294,200                     89                 97.34           -2%    2013
2013                                     1270          $ 299,450                    112                 97.18          -8%   2007
2009                                     1415          $ 272,000                   133                 95.62         -16% 2007
2007                                     1225          $ 325,000                    94                 97.42          -3.3%
6/1/2006-6/30/2007       1571           $ 335,900                      78                 98.09           +2% 2005
2005                                     1651          $ 328,900                     55                 99.01          +18% 2004
2004                                     1474         $ 268,476                    55                 97.20           Benchmark

 

So looking at this a bit further the change in median sold price between 2004 and 2015 is about a 13% increase. This is through the worst housing market in the country’s history. So do you think real estate values are improving? Of course! But buying the right house… in the right neighborhood… in the right condition at the right time makes a big difference. Look at the unit sales in 2009 but the lower price point. Remember the housing stimulus (2008-2010). Had the government let the market work freely we might not have seen the increase in risk, rise in subsequent defaults and lingering effects of 2007s financial meltdown. Who knows?

Using this analysis by no means covers the gamut of scenarios facing buyers and sellers. But you have to think long term with real estate. If you plan to own your home for 10 years, you will win.chart graphic What is a win in real estate? Live for free essentially and maybe make money on your “investment” of time and money. Keep it in good condition and up to date with market trends and you’ll do fine. If you neglect it, borrow fake equity and don’t pay attention to the current market demands and trends, you will be lucky to break even.

The home you live in is not an investment. It is your home and place to be safe and secure. Of course you can rent and be safe and secure and be limited to market swings (somewhat!). IMG_3819But if you rent a home at today’s average in Williamsburg of about $1800/month that’s $21,600 year or $210,600 over 10 years assuming no increases in rent and you don’t have to add the cost of moving 3 or 4 times during that period. That money is gone and you paid someone else’s mortgage. Protect your money and have more freedom and control over how, where you live. Purchase a home today, historically it’s still by far a safe harbor for your housing budget!

What Real Estate Bubble?

Yorktown balloonI’ve been preparing for a new listing in Yorktown, which is where we launched the famous RE/MAX balloon in this picture a few years ago. I was doing my usual research for the seller and looked through the recent market obviously but it had been awhile since I looked just the Yorktown market so I did a 10 year snapshot of comparable homes to his.

  • Yorktown (area 112 of the REIN MLS)
  • 4 Bedroom or more
  • 2200-2700SF
  • Priced between $325,000-$400,000

That is pretty basic criteria to start with, but pretty consistent with the average buyers expectations or needs today. So I went back to 2006, wanting to see the data just before the official “bubble” and how the area has faired since. The chart below is showing monthly and yearly median sold prices using the above criteria. This data was pulled from the REIN MLS on 2/7/2016 by me.

Historic Sales Price TrendA.jpg

So the red highlighted section is generally considered the “bubble”. Mid 2006 to the late fall of 2007. These numbers hardly indicate a wild swing in prices and in comparison to the years following, for this type of home, seem a little unusual. We saw higher median prices in late 2008-early 2010 most likely as a result of the government stimulus!

Comparing 2006 to 2015 we saw very little change, but we do see some stabilizing. There are swings throughout each year and there always will be because of the seasonality of real estate. Delving into it a little deeper I highlighted the highest median sold price/ year (2008, $371,774) and the lowest (2012, $361,723).  Throughout the course of each year we saw some drastic changes in the median sold price but in 2015 we saw things much more stable. There was only a 7% swing from the worst month to the best month. This was due I believe to a tightening of the inventory and great balance between buyer and seller expectations. Homes were being priced competitively all year long.

As always, stats can be made to create whatever result you want. But f you are looking for the above criteria in a Yorktown Virginia home and it comes on the market priced in the $365,000-$380,000 range you might want to act fast. As of today’s writing, there are only 232 single family detached homes for sale in Yorktown VA. of those, 156 have 4 bedrooms. Only 76 of those are less than $400,000 and if you want a little privacy say…. 1/2 acre lot or more there are only FOUR homes today to pick from.

If that’s what you want though call me, I’ve got a beauty coming out in early March I think!

Some Williamsburg VA real estate market insights!

If you’ve been on my blog before or if this is your first visit, thanks for reading it. Thank you even more if you share or comment on it! In the meantime, check out this new listing at 100 George Sandys’ in Kingsmill. See more views at details at www.100GeorgeSandys.com

There have been months and now years of recovery in the real estate market nationwide and locally too. The “bubble” burst during 2007. That was over 7 years ago now. Think about it. If you had a freshman in high school at that time they are graduating college this year or next! A LOT HAS CHANGED! There have been many people, groups and industries working hard behind the scenes to heal from arguably one of the two worst economic calamity’s in 3 generations of lives. And lots of people will never recover from what happened, but it was healthy, it was disserved and we had to burn to rise from the ashes like the phoenix!

Enough of that, what is the market looking like locally today? Who is holding the cards-the banks, the buyers or the sellers? In my opinion, the buyers still have the upper hand locally-unless they are looking for the perfect house in the perfect neighborhood, with the perfect schools….and priced below market value. I can tell you there are hundreds of buyers ready to pounce on that listing! There are agents giving sellers bad advice on pricing. Some too high, and worse some too low. We need to be aware of the past market conditions, acutely aware of the current market conditions, while anticipating the future market conditions. I know some very smart real estate agents and there are some really smart economists studying housing who got it wrong, and continue to get it wrong!

So I have my observations and opinions. Take them for what they’re worth. I am not a college graduate, but I do consider myself very aware of MY real estate world. And I won’t offer a statistic opinion without backing it up!

TODAY there are 568 active listings (WMLS 1/27/15)  for single family homes in all of James City County and the City of Williamsburg. The average current price is @ $510,000. It is @3000SF and has been on the market for 184 days. in 2014 according to the WMLS today, we sold 923 single family homes last year at an average price of @$370,000 that was 2600SF and on the market for 90 days. There is one problem with statistics and averages though. EVERY home, EVERY Buyer and EVERY seller is unique and AVERAGES have little to do with anything except a way to monitor the trend in activity. For instance, in drilling down the sold inventory and looking at those in the Lois Hornsby Middle school zone there were 330 sales and the prices ranged from $53,000 to $1,800,000. The average selling price though was $428,000, was a 2900SF home and sold in 81 days.

So does this mean every house priced above the average selling price is too high? Of course not. Nor should every seller priced lower think they can get the same price. Every element of a buyer, seller and property is different. Look at the surrounding active market choices. Can you buy a better home for less or even the same price? Does the closed market reinforce the asking price and will it appraise? Is the buyer or the seller under any undue pressure to complete the transaction?

There are many considerations involved in this very emotional and difficult decision making process. You are hiring your agent to be your counselor and advisor. Not your best friend. Their advice may not be what you want to hear, but if they are a great agent, they’ll do it but should at least do it politely!

Who really sets the real estate market…buyers, sellers or agents?

Who really sets the real estate market…buyers, sellers or agents?

If you’ve read any of my past posts, you’ve noticed that I really don’t like statistical interpretations of the market. While I post a lot of them, what I may really be trying to convey is they are almost meaningless to the reality of the interaction between buyers and sellers and establishing “the market”.

chart graphic

No one can argue that each and every property is unique. Every quarter of the year has different trends. A myriad of economic factors affect prices throughout the year or years. So it is very difficult to match todays market up to even just last month. The great news is the trend that’s been brewing over the last 7 years is one of steady improvement in real estate activity and prices-at least for the sellers and the overall economy that is, not for the buyers coming in looking backwards for deals!

Even when looking at condos and townhomes. Two identical condos are likely to be different in the way they “show”. Staging, condition, smell, view all will likely be unique. One particularly offensive smelling or looking unit “should” sell for less one that doesn’t. But like the real estate is different, so are the buyers and sellers. As a professional, I need to be keenly aware and sensitive to what each person’s style and preference may be. And I need to constantly remind the buyers and sellers that their reality may not be the sellers and vice versa

And how do we actually establish the right listing price? And who is to say that price is right….or wrong? Let me say this though, it is relatively easy to over price or under price a house. When a hyper motivated seller NEEDS to sell in less than the market average time, they are most likely to under price the house-resulting in a quick sale. So does the next door neighbor have to follow the same pattern? Should the real estate agent expect that EVERY buyer looking at that street or neighborhood expect the same deal? In my opinion, no they shouldn’t!

20141208154251

Likewise, buyers too often focus on the price per square foot that as a fact rather than a variable benchmark. There are many factors that affect PSF, like the land value, the condition of the house, needed or completed improvements and don’t forget the sellers motivations for selling. Does the seller NEED to sell, do they want to sell or are they just hoping to sell?

How about the buyers motivations. Does the buyer NEED to move or do they WANT to move? Do they need granite counters and a swimming pool or would they just be nice to have if a seller that has those would be willing to deeply discount the price because they HAVE to sell? How much value do you put on privacy, character, quality, location, schools etc? Those motivations vary among all the buyers I’ve ever worked with so how can one buyers eventual terms line up with another buyers terms.

3004 River Reach-Governors Land

This beautiful home is on the market for $849,000 in the areas premier gated-golf course- waterfront community!

All of these factors come into play in the decision making process. Is buying or selling a house emotional? You bet. Do buyers and sellers only make emotional decisions or do they balance the emotions and economic, logical implications? You bet.

So with all of this in play, you need your real estate agent to be a professional guidance counselor, marriage counselor, scheduler, keeper of secrets and personal information, chauffer and scapegoat for everything about the transaction that you will hate. So pick a great one, they are worth their weight in gold!

How is the Williamsburg VA real estate market?

How is the Williamsburg VA real estate market?

Median Closed Sales PricesWell it looks like most of October closings have been posted in the MLS so we can look at how we compare to the various media reports you may be seeing. Remember, real estate is local. So every market is different and even within most markets, there are mini markets that need to be watched and considered as you look for your next home.

The following live data chart shows the trend of closed sales (units) over the last 12 months. This data comes from the Williamsburg MLS and the following charts are live data charts so you can hover your mouse along the lines for monthly, quarterly or yearly details. Click on the images to activate the graph!

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While the market nationally seems to be improving according to many of the reports I’ve been seeing, I think locally we are not as good as the numbers would indicate. As I try to get feedback from agents who have been showing my listings, and conversations with agents in general I am hearing that many buyers remain skeptical. In addition, many of todays buyers-especially the  typical Williamsburg buyer lack a clear motivation to move or have any sense of urgency. This frustrates sellers who show the homes, get good feedback about, price, condition, but then hear the hasn’t decided when, if or where they want to move.

So locally, our MLS reported rising prices and rising sales and pending data. What I pick up from the above charts with regards to pricing and movement is we might be seeing rising prices on fewer sales as we near the holiday season. You can see the seasonality of the market in the above charts too. Just like a smaller home generally has a higher cost per square foot, fewer sales often create the illusion of higher prices.

Another important consideration when looking at the statistics of pricing and sales are whether they are averages or median. They are different numbers in all cases, and get intermingled some times! It is also important I believe to remember that what is selling TODAY only really affects you if your home is also for sale or you are actually in the market to buy !

SO HOW DOES THE MARKET DIFFER BETWEEN “GREATER WILLIAMSBURG” AND THE WHOLE MLS?

That is a great question and one that Zillow, Trulia, Realtor.com or any other search system a buyer or seller might employ, cannot address. That adds to a lot of confusion among buyers calling me for the first time! The geography of Williamsburg and the municipal boundaries, services and demographics make this a very interesting place to live. You can live in Williamsburg in any of three municipalities with substantial differences! The charts above reflect the “greater Williamsburg” market comprising zip codes 23168-23185-23188. Even though 23168 is actually referred to as Toano (p.Toe An O). These are the zip codes with the majority of activity between buyers and sellers. The entire MLS by comparison will includes listings and sales data for properties potentially anywhere in Virginia that an agent chooses to post through the Williamsburg Multiple Listing Service. A buyer looking to be in the” best Williamsburg school” needs to look at all of this data when making a purchase decision.

Click on each of these charts to see what differences there are between “Greater Williamsburg” and the whole MLS. When I look at specific neighborhoods, school districts, zip codes etc., we can really find the appropriate price ranges for buyers or sellers. This is where working with a LOCAL full time agent makes your life easier! Call me if you are interested in a thorough analysis of a particular segment of Williamsburg Real Estate!

 

12 month mls statsmedian sales price MLS

Williamsburg Real Estate Reality Check V 2.0

3004 river reach (2)From time to time I get frustrated with what buyers are looking for versus what is on the market, and more frustrated that the first thing an agent does when a buyer calls to see a home is put them in their car and hit the town, before spending any time educating the buyer. Why does the agent do that? Because the buyers rarely care or want any advice. After all, they’ve looked at Zillow or Trulia, the clear authorities on market value right? There is no doubt buyers have ample sources for online house hunting and listing websites. Are they accurate and are they complete? Not always…

Buyers need to let us help. They shouldn’t have to ask us to help explain the market. Realtors should require a  sit down to explain the market. We should help them evaluate what it is they want and need,  and what is their budget. Is the budget a cap or is it a beginning point? Many buyers come to me and want to start thousands over their budget cap, while not giving an inch on location, condition, terms. What a buyer visualizes, may not be in their budget.  I really do want to help you find what you want and need, but even when money is no object, it really is.

So what is it an experienced agent brings to the table that Zillow and Trulia don’t?

First and foremost agents have local experience, knowledge and perceptions. Granted the levels of those all vary greatly and need to be vetted. But any agent maybe better than no agent or an unknown agent. Secondly, an agent will or should be able to separate you from the emotional aspect of buying. Not replace the emotion, but to help you see the logical and long term aspects of your search and ultimate decision.

Statistically Speaking

Weeding through the market intelligence available is important. We are all flooded with statistics every day. We make decisions based on those, while hopefully tempering the emotional part of the decision.

So my value to you will be my 11+ years of experience, education and training. As both a very experienced listing and buyers agent I can help you see both sides of the transaction. I use my experience as a buyers agent to help my sellers understand the transaction from that perspective and likewise, my buyers learn from my understanding of the listing process and sellers perspective.  Lately, we’ve been getting lots of encouraging news about real estate activity, albeit nationally. Locally, I can report mediocre sales and activity. I think expectations and buyer readiness is part of the problem and coincidentally that is the same for sellers today!chart graphic

Here are some stats simply listed as a starting point. My criteria was pulled from the WilliamsburgMLS which carries the brunt of our local listing data. There is a margin of error because not all sales are listed properties or may not be listed or sold using the WilliamsburgMLS or Realtors who belong. I used the whole MLS for sold listings over the previous 12 months from this posting date, then looked at various price ranges and detached single family homes in zip code 23188 for now, and factored out the sold properties in 55+ adult communities. My next post will break down the differences between the various zip codes and municipalities making up “Williamsburg”.

Todays active listing count is 1459 total. The past 12 months sold count is 1798. For zip code 23188 that dwindles to 464 and when factoring out the local age restricted community that drops to 297 sold detached single family properties in the last 12 months. The same criteria for 9/2012-9/2013 was a total of 1494, and 9/2011-9/2012 was 1215 closed sales respectively. Data excluding age restricted communities is not avalaible Year to date we are slower than last year, but way better since the bubble burst!

For zip code 23188 the average sold price in the last 12 months was $371,002 vs an asking price of $380,343 and the average square footage was 2616. Looking at that more closely there was a low of $275,000 for a 2641 SF home and a high of $488,000 for a 2629 SF home. Looking at the average price, I found a $375,000 1600SF home and a $375,000  3359 SF home. So buyers focusing only price or price per square foot can see vastly different “values” or homes.

Out of the 434 active homes in 23188 today, 337 are single family detached. They break down by price this way:

  • Under $300,000=72
  • Under $200,000=19
  • Under $150,000=5
  • $400,000-$499,000=68
  • $500,000 to $999,000=91

Once we start looking at other criteria like bedroom count, schools, age etc we can really get to the heart of the “market” for a particular buyer or seller. That is the value of finding the right agent. You have to be willing to share and accept information, criticism and advice as an agent and as a buyer or seller!