By David Ferrall
As I say every year at this time, kudos to the organizers of the annual Crozet Fourth of July celebration held a few Sundays ago. The community turned out in droves to enjoy the parade and ensuing party at the Crozet Park, with a spectacular fireworks extravaganza. What a wonderful evening!
Speaking of fireworks, the second quarter real estate market in Crozet continues to build on the strength of the first quarter. There were 84 total residential sales in the second quarter, up 9 percent over the same time last year. And year-to-date sales were up 19 percent over 2014. This trend is mirrored in Albemarle County, where according to the mid-year report from Nest Realty, sales in the county were up 8.5 percent (see chart provided courtesy of Nest Realty) in the first half of the year. This strength is reflected in declining days-on-market for listed properties and in declining inventory. But while inventory has dropped to levels not seen in many years, prices have not really advanced as would be expected. Anomalies like this continue to make current housing prices relatively attractive.
Of the total sales for the quarter, one (a large rambling home on Kingsway in Afton) was for over $1m and will be removed for statistical purposes from this article. There were 64 detached home sales, priced at an average of $159 per-square-foot, which was a 10 percent increase over the same time last year. The average price for an attached home rose 5 percent to $412,000. Twenty-two of these sales were for new construction, the majority being six sales in Wickham Pond, followed by five in Old Trail, four in Grayrock West, four in Foothill Crossing, and three in Haden Place. Grayrock West is now sold out, and there remain only four lots in Wickham Pond. But a new neighborhood, Westlake at Foothills Crossing, has opened for sales and one contract there was pending at quarter’s end.
Of the 64 detached sales, 13 were for properties of an acre or more, which tend to be non-neighborhood, country properties. This represents 20 percent of total detached sales, a figure that has been extremely consistent over the past few years.
There were 19 total sales of attached homes in the quarter, up 72 percent from the same time last year, and the most total quarterly sales since the third quarter of 2013. The average cost for an attached home rose 8 percent to $152 per sqft, the average price rising 5 percent to $297,000. Sales were spread across six communities, with five new-construction sales in Old Trail and four in Haden Place. There were five re-sales in Highlands, and several each in Parkside Village and Bargamin Park. A lone sale in Waylands Grant rounds out the total.
There were four land sales in the quarter, matching the total at the same time last year. Year-to-date transactions are lagging a bit, though, there being eight through the first six months of the year compared with 12 in 2014. Somewhat surprisingly, and disappointingly, distressed sales continue to occur in Crozet. There were four foreclosure/bank owned/short sales in the quarter versus two in 2014. We are up to eight already in the first half of 2015 compared with five at the same time last year. That’s a trend that no one hopes continues.
A trend that won’t continue is the perfect calm of home prices below peak value coupled with continued historically low mortgage rates. As recently reported in the 2015 State of the Nation’s Housing Report from the Joint Center for Housing Studies at Harvard University, the monthly mortgage on a median-priced property is the lowest its been in 25 years, save for the recession-ravaged period of 2010-13. This, coupled with renters facing dwindling supply and higher prices, makes a compelling case for present home purchase.
Constant rumbling from the Federal Reserve is fueling speculation that interest rates will rise this year, which will lead to declining affordability when mortgage rates go up. Where personal finances and situations allow, owning a home is increasingly more affordable than renting. But both costs are on the upswing. Locking in a mortgage now through purchase (or refinance) can help lock your housing cost for years to come.