Western Albemarle Fourth Quarter Real Estate Report: Crozet Home Sales Step Up Smartly

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By David Ferrall 

Chart courtesy Nest Realty.

We survived the Cliff, and there are now vague rumblings about the Ceiling. But the bumbling partisan missteps in Washington currently hold no sway over the Crozet real estate market. 2012 was a banner year for local home sales, the 244 total Crozet sales being the largest number since 2006.

The fourth quarter of any year is usually the time the market takes a breather, and folks take time to enjoy the holidays, yet more than a fifth of local total yearly sales happened between October and December. This even annual distribution, coupled with factors like high attendance at open houses, multiple offers on listings, and continued low mortgage rates, paints a pretty peachy picture for local buyers and sellers. The forecast is for a busy spring, with the chance for good, fresh inventory available to buyers with continued strong interest-rate-driven buying power.

The good news isn’t limited to Crozet. According to the 2012 Nest Report, there was a 15 percent sales increase in the local MSA (Metropolitan Statistical Area including all local counties), and median prices edged up two percent. In Albemarle County, sales were up 14 percent to 1,280 on the year, Crozet being the leading sales area with about one in five sales happening locally. While these numbers compare well to the low figures of past years, they represent a flat-to-upward trend that the local and national economies have been looking for. Only with hindsight in coming months will we be able to determine if the real estate market has truly bottomed out, but from where we are right now, the future certainly looks brighter.

Boy, did we shine in the fourth quarter in Crozet! Of the 53 total residential sales, 39 were detached and 14 attached. These attached homes were mostly new construction (10), spread between Liberty Hall and Old Trail. Of the 39 detached home sales, 22 of them were new construction, with a national builder enjoying success in Westhall (five sales) and Wickham Pond (five sales), and local builders selling 10 homes in Old Trail. The 62 total sales in Old Trail this year have helped attract several new builders to the development, which will enhance variety and give buyers greater selection. The biggest sale of the quarter was Ramsay Farm in Greenwood, which sold at absolute auction for $3.3 million (For statistical purposes this sale is being left out of square foot and average price figures.)

Not only were sales up in the area, but prices were up as well. Price for a property’s finished square foot rose 3.8 percent overall from the same time last year, the bulk of this gain being in attached properties.

Average prices skyrocketed, moving from $310,000 last year to $411,000 this year for a detached house, and from $238,000 to $290,000 for an attached house. This was an overall average increase of 31.5 percent! The median sales price rose about this amount as well. These jumps are in large part attributable to re-emerging confidence in the real estate and in larger homes being bought. In 2012, 30-year rates dropped another 12.5 percent, from an average of 3.89 percent to 3.38 percent, roughly where they are today. Buyers can afford to buy more expensive properties today than they could a year ago. And numbers show that they are! Buyers are also feeling more confident about the real estate market than they have in years. National statistics show the “move-up” buyer is again looking to upgrade. This segment of purchasers has been absent in past years and can add real oomph to the market.

But 2012 did see an important decrease. Short sales (where a property sells for less than the amount owed on it by the owner) and lender-/bank-owned properties (that have been foreclosed on) declined over the year. There were four short sales in the fourth quarter of this year, and a total of 20 short and lender-/bank-owned sales over the year. In the fourth quarter of 2011, there were four short and two lender-/bank-owned sales, and 23 over the year. As a percentage of total sales the 2012 figure came in at 8.2 percent, vs. 12.1 percent in 2011. This 32 percent drop is great news, as distressed sales can be harmful to local markets by dragging down comparable sales prices. But more importantly, they can cause great stress to the homeowner.

At year’s end there were 79 transactions waiting to close in 2013. This is a 34 percent increase over the same period last year. Total inventory in Crozet has dropped from over 12 months to just over 9 months, year over year, an important trend that signals demand is rising while supply falls.

This movement is mirroring what is happening nationwide. Prices do not seem poised to jump, but they are holding steady and some areas are seeing small increases. This could bring some fresh inventory to our market as sellers who may have been waiting for a good time to sell have the best opportunity in years right in front of them.

In 2013 buyers should have plenty of properties to choose from, with historically low interest rates to fund their purchase. Sellers who price their properties properly have the best chance to sell that they have had in years.