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Sales decreased in the Valley (-6.7%) compared to last year.

*includes sales outside the counties listed

**numbers courtesy of the Greater Augusta MLS

Median Area Prices

Year over year median area prices remain relatively unchanged. The median sales price at the end of the third quarter of 2010 is less than half a percent different from 2009. Taking an historical viewpoint, the median sales price is just below 2005, which was the middle of the price acceleration of 2002 to 2007.

The median prices listed below are the middle of the market of properties that sold. Simply put, this is an indication of what buyers were willing and/or able to pay and is not a true reflection of individual home prices. As shown below, median prices in five counties have increased, and the area price per square foot remained unchanged from last quarter.

Overall, the median home price (including attached homes) decreased by $900 (-0.4%) compared to the first three quarters of last year. Due to the diversity of our area and range of home values, median prices may not tell you much about the value of your home. Consult a REALTOR® about conditions in your segment of the market. There are four counties that showed increases in their median prices: Albemarle (+1.7%), Fluvanna (+1.8%), Louisa (+5.9%), and Orange (+2.5%). The other areas covered in this report showed a decline as follows: Charlottesville (-2.5%), Greene (-1.4%), Nelson (-10.7%), and the Valley (-1.0%).

*includes sales outside the counties listed

**numbers courtesy of the Greater Augusta MLS (note: these are average prices, not median)

Price per Square Foot (Finished)

Another indicator that allows us to see what is happening to home prices is the price per square foot numbers. The average price per square foot of finished space in homes is not an exact science, but a downward trend over the years clearly indicates a decrease in prices (and vice versa). The third quarter number held its own year to date, and shows a slight decline year-over-year.

*includes sales outside the counties listed

**based on CAAR MLS data

Inventory of Homes for Sale

The inventory of homes for sale in the Charlottesville area has decreased slightly since the end of the 2nd quarter, but is up from last year at this point in time. As we have reported for the past year, excess inventory is causing many of the problems with our local housing market. Until we are able to reduce the number of homes for sale, we will continue to have soft home prices.

As of this writing, we have 3,506 homes on the market, compared to 3,425 at this time last year, an increase of 4.0%. The median price of homes currently for sale is $288,500, which is $6,000 less than last year. The average DOM (days on market) of these homes is 157 days, which is 2 days less than last year and 40 days more than homes that sold this year. The most telling statistic related to homes currently on the market is that the average price per square foot is $195, compared to $140 for homes that sold in the first nine months of the year.

Housing affordability continues to be the positive aspect of this market. There are 1060 homes for sale at $200,000 or less, with an average DOM of 148 and an average price per square foot of $196. This is 181 more homes in this price range than last year at this time. There are 264 homes currently on the market priced at a million dollars or more, as compared to 270 last year with an average DOM of 253, up from 244.

Days on Market (DOM)

In this market, the average days (DOM) a property stays on the market is less important than it would be in a more balanced market. There are many variables in the marketplace – excess inventory, foreclosures, short sales, and financing issues – that affect the length of time a property is on the market. This year to date report continues the trend of stability in days on the market that we saw at this point in time both in 2008 and 2009. We are still in a buyer’s market, which means the best way to shorten the days your property is on the market is to price it correctly.

*includes sales outside the counties listed

**numbers courtesy of the Greater Augusta MLS

New Construction Leveled off

It is important to note that many “new” homes are not included in CAAR MLS statistics. Some buyers work with a builder directly to custom build a home. With that said, the historical perspective of the pace of new home sales gives us a reasonably good picture of the market for new construction. As the chart below shows, new home sales seem to be leveling off. If this continues for the next several quarters, then we may be able to say that 2009-2010 was the bottom of the new home construction market.

2009

2008

2007

2006

2005

Condos and Townhomes (Attached Homes)

The sale of attached homes is only reported in Charlottesville and Albemarle because very few properties in this category are located in other counties, except Nelson. Since the condos in Nelson are primarily in the Wintergreen Resort market, these numbers are not included. While the sale of attached homes in Albemarle increased just slightly (+2.9%) in 2010 compared to the same period last year, the City of Charlottesville continues to show a continuous and strong downward trend ( -30%). This may be the result of the absence of new townhome communities in the city as well as a decrease in condominium sales. The Albemarle median sold price dropped slightly, from $221,750 to $220,000, which has been fairly consistent for the last 5 years, while the days on market increased to 103 from 78 last year. In Charlottesville, there were only 88 attached home sales, with the median price also down 10.4% from $218,950 to $196,100. The days on market decreased from 147 to 106. This indicates that the listings may now be priced more appropriately.

2005

2006

2007

2008

2009

Conclusions and Predictions

Due to the influence of the home buyer tax credits of earlier this year, it is difficult to draw conclusions at this time. We should be able to learn more about this market by looking back after the fourth quarter and comparing the two years in their entirety.

CAAR will continue to watch the median price of homes for sale to see if the prices continue to stabilize during the last quarter of the year, traditionally a slower time in the marketplace. A reduction in inventory will help take pressure off home prices and indicate that the market is becoming more balanced. Price sensitivity is still the key factor in this market, so if you are considering the sale of a home, be sure to have a REALTOR® or appraiser prepare a comparative market analysis (CMA) for your property so that you can price it correctly based on your goals. And, if you are considering a purchase, a REALTOR® can help you understand the current marketplace so you can be confident in purchasing a home that is just right.

This Quarterly Market Report is produced by the Charlottesville Area Association of REALTORS^® using data from the CAAR MLS and the Greater Augusta MLS where noted. For more information on this report or the real estate market, pick up a copy of the CAAR Real Estate Weekly, visit www.caar.com , or contact your REALTOR^®.