Welcome! This blog tracks the real estate market in the Central Shenandoah Valley, featuring market data and analysis, an exploration of common buying and selling questions, and candid commentary on all things real estate.
If you are interested in discussing any of the topics on this blog, or the details of your specific real estate situation, call or e-mail me!
In great news for downtown Harrisonburg, Larkin Arts will be opening this Saturday which features an art supply store, gallery spaces, art classrooms for students of all ages, and studios for working artists.
Read more about Larkin Arts on the Do Downtown Blog, or at LarkinArts.com.
Better yet, swing by the grand opening tomorrow (Saturday) from 9A - 5P.
During the real estate boom, many people were trying to "get rich quick" by investing in real estate – and many people succeeded. Now that the market has cooled back down, there are still great investment opportunities, but you have to know where to look.
Foreclosure Auctions offer a unique opportunity to buy a property at a price that could be much lower than market value. A lender will open up the bidding at such a Trustee Sale with a price typically dictated by the remaining balance on the owner's mortgage plus the Trustee's fees. In many cases, this opening bid is higher than market value --- but occasionally, there will be great opportunities to buy a property at the courthouse steps and then keep it as a rental property, or fix it up and sell it. The caveat to this, of course, is that you will usually not have the opportunity to view the interior of these properties before the auction. You can review upcoming Trustee Sales online at HarrisonburgForeclosures.com.
Bank Owned Properties are those that do not sell at the courthouse steps and thus come to be owned by the bank that foreclosed on them. These properties typically offer better than average buying opportunities – but they are not amazing deals – the bank wants to recoup as much of their loss as possible. Buying a bank owned property is relatively straightforward, though it requires wading through the lengthy additional contract documents provided by the lender. You can review upcoming Trustee Sales online at HarrisonburgREO.com.
Under-Priced Homes don't come around too often, but occasionally you (or I) will spot a property on the market that is priced lower than it should be. Typically this happens as the result of an above-average motivation to sell – perhaps an owner needs to leave the area for a new job, or there might be bigger picture financial issues, or a divorce, etc. Whatever the reason, there are usually a few properties on the market with better-than-they-should-be asking prices, providing unique buying opportunities for the alert investor.
Buying in bulk can offer you a discount, just as when you shop at Costco. If you are in a position to acquire several properties at once, from the same owner, you will typically have much more negotiating ability than you would otherwise. This could include multiple investment properties owned by one individual or entity, or perhaps new construction properties.
If you are interested in investing in real estate in Harrisonburg or Rockingham County, there are opportunities to be tracked down, at the sources above and using a few other research strategies depending on your specific goals . Don't forget, of course, to also consider how you will finance the purchase, whether you will rent or flip the property, and the tax implications of investing. It can still be an exciting time to invest in real estate, though you must be more strategic now than was required during the real estate boom.
The landscape of Court Square is changing again this week --- and this time, it is not a result of a Facade Enhancement Grant from Harrisonburg Downtown Renaissance. Nor is it the preservation of a historic building. And it's also not the redevelopment of a building into an exciting new mixed use space. Instead.....drum roll please.....it's a building being torn down to create a parking lot.
Hmmmm.......does downtown Harrisonburg need more parking? The aerial view above shows existing parking lots (black) and the new parking lot (red). I'll let you draw your own conclusions.
Read the Daily News Record article by Doug Manners for comments from the building's owner as to why he is creating this new parking lot.
Click above to view parents of kids in Smithland's Dual Language Immersion Program talk about their experience with the program.
Smithland Elementary's Dual Language Immersion Program offers elementary students (K-2) the opportunity to have half of their instruction during the day in English, and half in Spanish.
The program was started two years ago with Kindergarten, and has now been expanded to include first and second grade. Click here to read the recent (Sept 4, 2012) Daily News Record article on the program.
Looking to buy a home in Smithland to have a chance at enrolling your child in the Dual Langauge Immersion Program? Here's one fantastic house that is currently on the market....
3 BR, 2.5 BA, 2252 SF, fenced backyard, large basement family room (learn more)
I keep HarrisonburgForeclosures.com updated with scheduled Trustee Sales....and usually there are 15-20 scheduled in the future at any given point in time. Currently, however, there are only six scheduled!?!
Don't get me wrong, I'm excited that almost all homeowners are staying current on their mortgage payments and are not in jeopardy of foreclosure --- but I'm surprised at this significant swing in scheduled foreclosures.
Find out more at HarrisonburgForeclosures.com or search for bank owned homes at HarrisonburgREO.com.
Every once in a while, something unexpected happens in the local real estate market --- say, for example, the bulk sale of 22 condos at University Place!
This morning, 22 listings were entered into the HRAR MLS in University Place (South Ave) and then marked under contract --- each priced at $41,000 --- so apparently a $902,000 bulk sale. Each of the properties, as you might imagine, has a common owner.
Let's contextualize it....
University Place sales during 2010 = NONE
University Place sales during 2011 = 2 sales (med price = $42,600)
University Place sales during 2012 (YTD) = 2 sales (med price = $39,500)
Active Listings: 10 listings, priced at $59,900 each
So what is the "wow"? The sale of quite a few of these condos all at once after very slow sales in the complex over the past few years. And at an apparent price that doesn't seem fantastic relative to recent sales --- unless the actual sales price will end up being lower than $41,000.
A new group of businesses will soon be opening up at The Village at Massanutten --- next door to Log Cabin Barbeque and across the street from the entrance to Massanutten Resort.
Thus far, this new development will feature a souvenir shop, a country store featuring Virginia-made products, a nail salon, and two mobile food restaurants --- The Sausage Shack (kielbasas and funnel cakes) and Jack Brown's Beer & Burger Joint.
Read more per the Daily News Record, here.
It depends on the price range, how much of a down payment you are making, whether you are willing to keep the property as a rental property after you move out, and many other factors. However, below is a 2-year, 3-year, 4-year and 5-year analysis of buying versus renting a property valued at $150K compared to $300K, which shows that....
There are, of course, plenty of extenuating circumstances. Many people might buy a $150K house (or townhouse) even if they are planning to be there for only 3 years --- because they want their own home (not their landlord's), or to get in a certain neighborhood, or because of the tax benefits (not shown below).
Every buyer's situation is different, and I'd be happy to help you run an analysis similar to those shown below if you're interested in analyzing your best housing move.
If you do some digging on Zillow.com, you will see they rate their confidence in their estimate by each geographic area. A rating of five means they are most confident in the value. A rating of one means they are either using the tax assessed value or "unable to compute Zestimate accuracy".
As you'll note above, Harrisonburg scores a ONE by their own admission. This means that their value estimates are information is totally unreliable. You can read more about this on Zillow's website.
So before you put too much stock in what Zillow might tell you about your home's value --- remember that they themselves would tell you that their value estimates in Harrisonburg and Rockingham County are not at all accurate.
Last night the Harrisonburg City Council discussed a proposed conference center and hotel to potentially be built in downtown Harrisonburg. The proposal went before City Council because the developers are seeking public funding for part of the project.
City Council made a decision to seek competing proposals, which are due to the City by Nov 13, 2012. After competing proposals have been received, the City can decide whether to move forward with a feasibility study to provide more data with which to make a decision about whether to provide the public funding for this project. The hard costs of the potential feasibility study will be paid by the City with funds paid by each developer that submits a proposal.
The project team that is working on this proposed conference center and hotel include:
dpM Partners is based out of Gaithersburg, MD, has recently developed a Westin Hotel in Virginia Beach. Its principal, was the lead developer on the Stonewall Jackson conference center in Staunton and he is also a JMU graduate. The W.M. Jordan Company (proposed general contractor) recently completed the Hilton at Short Pump.
The proposed conference center facility would be 18,180 square feet --- twice the size of the JMU Festival Conference Center --- and would be the largest conference center between Northern Virginia and Roanoke. The hotel would feature 205 rooms and would have a full-service restaurant.
If eventually approved, the City would be contributing nearly $10 million of public funds to this project in the way Tax Increment Financing Bonds.
The specific site has not been publicly identified, for competitive reasons, but it is in downtown Harrisonburg within walking distance of Main Street.
I believe this is exciting news for Harrisonburg as it could potentially grow our local economy even further by bringing regional conferences into our area. It would also certainly be a boon for downtown retail businesses and restaurants.
Stay tuned -- within the next 60 days the City will be seeking competing proposals, and then they will be deciding whether to move forward with a feasibility study.
Click on the map above to view a larger version.
In the past several years we have seen quite a few changes on Port Republic Road on the map shown above, including:
All of this new road infrastructure, plus the new hospital, plus a clustering of residential developments over the past 15-20 years has lead to quite a few new projects labeled on the map above.
Given the new hospital, the new road infrastructure, and the large area of existing housing, it is not surprise that we are seeing these new developments along Port Republic Road. Stoneport is the largest of the new projects, and it will certainly be interesting to see what businesses are established in that location.
Exciting things are happening in the Harrisonburg and Rockingham County housing market. Click here to download my monthly market report (28 page PDF), or read on for some highlights.
As shown above, indicators were mostly positive in August....
As shown above, August 2012 was head and shoulders above any of the three prior Augusts -- and overall, the summer months of 2012 were quite competitive across the board.
Contract activity also surged in August 2012 --- showing a 16% increase over August 2011 --- and a 67% increase over August 2010! This is certainly a good sign for the coming months of closed sales data.
Declining inventory is certainly helping our local housing market head back towards more of a balance between buyers and sellers. The number of homes for sale has decreased by 19% over the past year.
Click on the image above to download my full market report (28 page PDF).
Also, here are a few articles I have written over the past month that might be of interest:
There aren't too many houses with swimming pools in Harrisonburg and Rockingham County --- at least not that many that you can actually buy.
To refine it even further, last evening I was talking to a colleague who has (potential, future) interest in relocating to the Harrisonburg area and buying a home on several acres with a swimming pool (and tennis courts, but we'll ignore that for now).
There are only 4 (!!!) houses currently for sale on 3+ acres in Rockingham County with a swimming pool.....
3817 Treasure Hill Ln Timberville, VA 22853 --- $799,900
14838 Little Dry River Rd Fulks Run, VA 22830 --- $315,000
7124 Windy Cove Rd Bridgewater, VA 22812 --- $379,900
9377 Fox Hill Dr Port Republic, VA 24471 --- $499,000
It might be a slow and tedious hunt, but if you want a house with a pool, let me know, and I'll start looking for you now.
A property can do well within an oversupplied segment ofthe market if it has unique characteristics that set it apart from all or most otheravailable options.
Despite an apparent returning balance in the local real estate market, there are still many segments of the market that are oversupplied....
However.....there are still some houses and building lots that can (and do) sell much more quickly than those against which they are competing. How can this be? Why does it happen?
Price, condition and marketing are all under your control. Here's another factor that is not under your control, but it is important to determine whether your property fits into this category. Sometimes a property can do well within an oversupplied segment ofthe market if it has unique characteristics that set it apart from all or most otheravailable options. Those "unique characteristics" might be that the house (or building lot) has amazing views --- above and beyond any of the competing properties. Or perhaps it's the architectural style of your home. Or the undeveloped common area behind your property. Whatever those peripheral factors are, it is important to recognize that they can help elevate your property above others as you compete in an oversupplied market.
These definitions do not describe all possible situations, but they will give you a general idea of the two ways to go about buying/building a new home....
CUSTOM HOME: A home designed jointly by builder and buyer, which is then built to the buyer's specifications.
SPEC HOME: A home designed by a builder, and built speculatively by the builder, who then works to find a buyer for the completed home.
Back in the height of the housing market (a.k.a. housing boom)....
Now, after the market has cooled off quite a bit (a.k.a. housing bust?)....
Thankfully, these desires actually coincide. There were lots of spec builds in the height of the market, and lots of buyers to buy them. There are very few spec builds now, and very few buyers to buy them.
Given the givens, here is some guidance for today's market....
Builders --- if you're going to build speculatively, put a good deal of thought into the floor plan and make sure it is going to be an attractive layout for a wide spectrum of buyers. Also, consider finishing the house through the drywall stage and then marketing it to find a buyer that can make their own selections for interior finishes.
Buyers --- talk to your lender early to know what will be possible for you. Buying a lot, obtaining construction financing, and building a custom home is quite a different financial transaction than buying a finished home with a traditional mortgage.
Do you ever see a house for sale online that seems to be too good to be true? It has everything you are looking for (4 bedrooms, 2 bathrooms, 2400 square feet) and it is priced $40K below all of the other homes you have been considering.
Shocked at the low asking price of your apparent dream home (per the specs) your hand trembles as you move your mouse over towards the "more photos" link to look inside. Could it be? Could it really be?
(Side note: Could it be what?? That the seller has grossly under-priced his house? And that no other buyers have figured it out yet?)
Your excitement builds even further as you look through the online photos --- the hardwood floors, the new gas range, the beautiful light fixtures! It is at this moment that you are thankful you have my phone number (540-578-0102) set on speed dial......and we quickly set up a time to meet at the house.
Walking quickly up the sidewalk, we look over our shoulders, wondering if other buyers and their Realtors will be showing up soon, joining into a frenzied pursuit of this wonder-house.
But sadly, as we start to walk through the house, we realize we've been fooled again --- by what the specs didn't tell us, and by what the photos didn't show us....
Walking back out of the house, our gait is notably slower and our shoulders slump in despair. Yet another house that was too good to be true. While the house looked good on paper, it was quite a different value proposition once we were actually inside.
Having experienced this several times lately, here is some advice...
This post was going to entitled.....Is it possible to price aggressively low and still priced too high? But I figured I'd approach it from a seller's perspective mid-listing.
In a changing market, it's often hard to get pricing right -- especially with a unique property. When pricing your home, we'll be looking at recently (6-12 months) sold listings --- as well as currently available listings.
The ideal (but rare) scenario....
Recently Sold Comparable Properties: $295K, $300K, $305K
Currently Available Properties: $309K, $312K, $319K
Given the above scenario, we'd be wise to list for either $305K or $299K and hope to sell for $290K - $295K.
But........there are some things that you can't always accurately predict......and thus there oftentimes will need to be corrections once your house is on the market.
Whatever the reason for the push back on price from prospective buyers, we can't argue with the market's general feedback if your house is being marketed well, and has been given adequate time on the market to be exposed to a large enough pool of buyers.
So......after we have your house on the market for a month or two, if we aren't having many showings (or we're not satisfied with the feedback from those showings) we may want to adjust our pricing strategy to work towards a successful sale.
Home sales have increased (2012-YTD as compared to 2011-YTD) and so have median prices. These prolonged trends are slowly leading us back towards a more balanced local housing market.
Jan 1, 2011 through Aug 31, 2011 = 522 (median price = $173,500)
Jan 1, 2012 through Aug 31, 2012 = 564 (median price = $175,000)
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