I have been asked many times, in the past several weeks, about what is going on in the Williamsburg market. So here are some of my thoughts about our market...
Several years ago, a local builder told me that he thought we were "insulated" from a real estate downturn because of all that Williamsburg has to offer (College of William & Mary, Colonial Williamsburg, Anheuser-Busch properties, proximity to beaches and mountains, golf courses, etc.). As we can all agree, we live in a great area.
Williamsburg is a desirable area to retire, and therefore, we have many people migrating from the northeast. Since home prices are typically higher in the New York area, homes seem affordable in the Williamsburg area. However, if homes aren't selling in the northeast then it trickles down to our area.
It seems the Williamsburg real estate market always lags that of larger Metropolitan areas, and the national news doom and gloom. We were still going strong when the national news was saying the market had stalled.
Transfers of single family detached homes through the Williamsburg Multiple Listing Service, in James City County and the City of Williamsburg, showed the following (see table of sales). In 2005, 1290 homes sold with a median price of $355,250 with an average days on market (DOM) of 61. This median sales price was 18.5% higher than the prior year. That was approximately 6 years of appreciation in one year.
2006 saw 1078 dwellings sold with a median price increase of approximately 5.6% to a level of $375,000 and a DOM of 74. In 2007, 879 units sold with a median price down 1.9% to $367,840, and the days on market increased to 100. So far in 2008, the median price has decreased to 2005 levels, or $355,000, and only 578 homes have transferred with an average DOM of 132. This median price is 3.5% less than the prior year.
When I am working on appraisals and come across properties that sold twice within a year or two, I enter them in a table, and graph the appreciation or depreciation to help gauge the market. I have entered In July 2006 a property sold for the second time 8.1% higher than it sold in November 2005, or an annual appreciation of 12.6%. Several other properties sold during 2006 that showed double digit appreciation from their prior sales. Starting in early 2007, the appreciation showed single digit appreciation. The second half of the year had mixed numbers appreciation and depreciation. In 2008 the few transfers I found were slightly negative, with the exception of a home within the City of Williamsburg.
Based on the overall median sale price decline of 5.6% from 2005 to 2008, and individual declines showing 1% to 3%, it appears that the James City County market has only declined approximately 3%. However, if the days on market continues to increase then prices will have to drop more in order to sell. Hopefully, sellers can afford to hold out and keep our prices stable.
Although we are not totally insulated from a downturn, it appears that we are not affected as much as the rest of the Country.
Please post to the blog letting me know your opinion of the market, and any changes you see, good or bad. If you are a Realtor, let me know if you had an increase in traffic, and what you are hearing from potential buyers.
A good friend of mine recently said, "I choose not to participate in the recession". Lets all follow his lead.
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