Click here to download and read the full report. 2009 CAAR Year-End Market Report

I will be doing a more thorough analysis this weekend, but until then, some of the salient points…

Some people have suggested that the first time home buyer credit hasn’t been effective, but I have completely disagreed with that, and while this data isn’t a clear indicator that the credit is working, it would suggest that more first time buyers (in the below $300,000 price range) have been in our market in Q4 2009, than we are typically used to.

As reported for the past two quarterly reports, significantly lower home prices (down 20% or more) are driving the pick-up in sales. In addition, the $8,000 tax credit for first time buyers supercharged the sale of starter homes (below $300,000) in 2009. 67.5% of home sales for the year were in this starter home category, which is approximately a 10% increase in this category.

- CAAR Year End Market Report.

One thing to be aware of is the average price per square foot we’re seeing across the different counties. This is one of the more profound ways to see that our pricing has returned to that of 2005 levels (at least), if not gone lower. My personal belief is that our prices are actually closer to what they were in 2004. Take a look at the $/SF analysis below to see how your county has fared.

Price Per Square Foot (Finished)

Another indicator that allows us to see the decline in home prices is a major drop in the price per square foot numbers. The average price per square foot of finished space in homes is not a scientific number, but a downward trend over the years clearly indicates a decrease in prices (and vice versa). According to the chart below, prices peaked in 2006 and have declined for the past three years. There has been a $28 per square foot drop since the peak in 2006. The current $143 per square foot is the lowest number since 2004.

- CAAR Year End Market Report.

According to the CAAR Year End market Report, our inventory of homes is slowly declining. Of course this was the main aim of the First TIme Home Buyer tax credit, and we are all anxious to see what will happen to inventory once it expires.

Inventory of Homes for Sale

“The inventory of homes for sale in the Charlottesville has continued to decline very slowly. As we have reported for the past several quarters, the excess of inventory is causing many of the problems with our local housing market. The decline in inventory is very encouraging, but we will still have too many homes on the market for the current demand. This could change very quickly going into the busy spring market.”

- CAAR Year End Market Report.

Average Days on Market

One piece of information that I always want future sellers to be acutely aware of is the average days on market. The days on market is a measure of homes SOLD BY AN AGENT THROUGH THE MLS, and how long they’re taken on the market being actively marketed before they have sold. This number does not include some very high days on market numbers for all of the homes that never sell, it only calculated DOM for solds, so it is artificially lower than days on market of ALL HOMES. If you are thinking of selling your home in the near future, you need to be acutely aware of the average days on market for your county and be sure to give your real estate agent a reasonable amount of time to accomplish your goals.

Will be elaborating more on this report later, but would love some questions from all of you!

Related posts:

1. CAAR 2007 Year End Market Report
2. CAAR Releases it's Third Quarter Market Report
3. CAAR Mid Year Market Report 2009

This new initiative will continue the current $8,000 first time home buyer credit to eligible participants until 2010- July 1, 2010 to be exact, which is when all closings must have occurred. In order to be eligible for this credit, you must have the property under contract no later than April 30, 2010.

It has also expanded the credit to current home owners. Anyone who has used their residence as a primary residence consecutively for 5 our of the last 8 years are also eligible for a tax credit when making their next home purchase. This is a $6,500 credit and the same deadlines still apply; April 30, 2010 for homes to be under contract, and July 1, 2010 for the sale to have closed.

Many of the details are explained in the following PDF document- please contact me with any specific questions!

Click here to download the November 7, 2010 Extended and Expanded Tax Credit.

Related posts:

1. Great Chart On Credit Scoring; Check this out if your credit might be in danger
2. Answer these questions to determine if purchasing a bank owned home/foreclosure is right for you…
3. New Forms to Claim The First-Time Homebuyer Tax Credit

Check out the market report here;

CAAR Third Quarter Market Report

Related posts:

1. Just Released! The Charlottesville Area Association of Realtors’ Year-End Market Report
2. CAAR Mid Year Market Report 2009
3. CAAR 2007 Year End Market Report