HARDING REPORT – DECEMBER 2005
*** News from Jefferson County WV Property Market ***
Each month the Harding Report includes the latest news and information from the Jefferson County, West Virginia property market. This is a free service compiled by Thomas Harding, a licensed real estate agent with Greg Didden Associates in Shepherdstown, West Virginia.
For additional local information or any other property enquiry contact:
Thomas Harding
www.tharding.com
304 671 7292 (cell-phone)
304 876 6400 (office)
1. The Here and Now
2. Jefferson and Berkeley County Market News
3. Best Real Estate Book 2005
4. Slow Down in 2006
5. Developer’s Corner
6. Lending News
HARDING REPORT –DECEMBER 2005
1. The Here and Now
We have now passed the shortest day of the year. It’s downhill to summer all the way. The snow is on the ground and it looks like we are going to have a White Christmas. One of the things I love most about this time of year is the holiday lights. Not only are the towns lit up - Charles Town, Harpers Ferry, Martinsburg, Shepherdstown – but people go to wonderful efforts to light up our dark nights with colorful lights, snowmen and angles.
What a year it has been. We have seen continued population growth in the region. House prices have increased exponentially for most of the year. New homes are popping up around the Eastern Panhandle like candy canes on a Christmas tree. Yet the roads are getting more crowded, as are the schools, the stores and the parks. There are many people extremely worried about the rapid increase in development. There are many smart people working to ensure that any development is smart, protecting both the environment and our resources.
What will 2006 bring? It looks like a slower housing market. Beyond that, my prediction is more new homes being constructed, more roads being built and more people moving to the area.
Feliz Noel to one and all.
2. Jefferson County Real Estate News – 4 out of 10
The information for November is a simple tale. The market is slowing down. Amazingly enough the total dollar volume of homes sold in Jefferson County fell almost 40% compared to the same period the previous year. The reason for this was the there were 40% less homes sold, while the value of the homes sold remained largely the same. Here are the other highlights.
Jefferson County Sales November 2005
|
|
2005 |
2004 |
% Change |
|
Total Sold Dollar Volume: |
$ 16,121,191 |
$ 25,869,892 |
- 37.68 % |
|
Average Sold Price: |
$ 287,878 |
$ 278,171 |
3.49 % |
|
Median Sold Price: |
$ 285,290 |
$ 268,000 |
6.45 % |
|
Total Units Sold: |
56 |
93 |
- 39.78 % |
|
Average Days on Market: |
47 |
47 |
0.00 % |
|
Average List Price for Solds: |
$ 299,909 |
$ 282,921 |
6.00 % |
|
Avg Sale Price as a percentage of Avg List Price: |
95.99 % |
98.32 % |
|
Berkeley County continues to be surviving the slow down better than Jefferson County. The following table show that average sold price continues to rise in Berkeley County, though the number of solds in November was down in 2005 compared to 2004.
Berkeley County Sales November 2005
|
|
2005 |
2004 |
% Change |
|
Total Sold Dollar Volume: |
$ 33,907,638 |
$ 30,973,890 |
9.47 % |
|
Average Sold Price: |
$ 238,786 |
$ 183,277 |
30.29 % |
|
Median Sold Price: |
$ 226,400 |
$ 173,000 |
30.87 % |
|
Total Units Sold: |
142 |
169 |
- 15.98 % |
|
Average Days on Market: |
41 |
48 |
- 14.58 % |
|
Average List Price for Solds: |
$ 244,778 |
$ 186,867 |
30.99 % |
|
Avg Sale Price as a percentage of Avg List Price: |
97.55 % |
98.08 % |
|
[source data, MRIS]
3. Recommended Real Estate Books
Here are the Washington Post recommended real estate books for 2005:
v “Reverse Mortgages for Dummies”, by Sarah Lyons. This is the best of several excellent new books about the pros and cons of tax free reverse mortgages.
v “Building Wealth One House at a Time” by John Schaub. Written by a successful 32 year old investor in single family rental homes, this books reveals why local house are the safest long term real estate investment.
v “Start Small, Profit Big in Real Estate” by Jay DeCima. The theme of this book is investing in run down groups of residential rentals.
v “Trump Strategies for Real Estate: Lessons for the small investor” by George Ross. The author has been a successful real estate lawyer in New York. The book is mostly about how Trump became wealthy thanks to real estate strategies. This superb book should be required reading for every serious real estate investor.
v “Real Estate Deal making” by George Donohue. Written by the president of the nation’s oldest real estate company, this book explains winning real estate negotiating strategies.
v “What No One Ever Tells You About Investing in Real Estate” by Robert Hill. This is the most unusual real estate book of 2005 because of its collection of 112 mini chapters about real estate investor personal experiences and valuable lessons.
v “The Pre Foreclosure Property Investor Kit” by Thomas Lucier. This ultra complete book reveals almost everything necessary to profitably acquire foreclosure distress properties without making costly mistakes.
v “Every Landlord’s Tax Deduction Guide” by Stephen Fishman. This unusual book makes tax tactics actually interesting.
[Washington Post Dec 14th 2005]
4. 2006 Home Sales to Slow Down
Home sales in the U.S. will drop as much as 10 percent in 2006, a decline caused by higher interest rates and housing market jitters, mortgage giant Fannie Mae said in a report Tuesday.
Economists at the government-sponsored enterprise said their best guess is that sales will fall 8.4 percent, to 7.62 million units. That would be the first annual decline since 2000, when national sales dipped slightly, said David Seiders, chief economist of the National Association of Home Builders.
Though the decline will mark the end of a five-year run that helped fuel consumer spending and economic growth, even Fannie's predicted level for 2006 would be the third-strongest year on record for home sales, the economists noted.
Fannie Mae Economists David Berson and Molly Boesel said purchase originations and refinance activity should also drop off. They predicted purchase originations would dip 2.3 percent to $1.45 trillion. Refinance activity will fall 51.6 percent to $653 billion, the two predicted in Fannie's "Economic and Mortgage Market Developments" semiannual housing survey.
"Despite a surprising jump in new home sales for October, the housing
market likely has peaked," the economists said.
Berson and Boesel said home price gains are expected to "slow sharply"
in 2006, down to about 3 percent after a couple years of double-digit
growth.
The adjustable-rate mortgage share of loans is expected to stay at about
30-31 percent, due to high home prices, the Fannie economists said. They
don't predict an increase in use of fixed-rate mortgages until home
price gains moderate for several years.
The two are joining an increasingly loud chorus of voices, including the National Association of Realtors and the Mortgage Bankers Association, predicting a slowing of the housing market in 2006.
[Inman News]
5. Developer’s Corner
· The Jefferson County Commissioners voted 4-1 to draft a resolution to deny a school impact fee exemption for seniors living in the proposed Huntsfield Four Seasons age restricted subdivision. Board of Education have said an exemption would cost the school system $7 million in capital improvement funds. [MBJ Dec 23 2005]
· County Commissioners agreed to appoint four new members to the Berkeley County Planning Commission: H Daniel Gannt, Donald Fox, Garry Mathews and Eric Goff. Additions to the board include an excavator, an engineer and a teacher. [MBJ Dec 23]
· A group of Lost Road residents have filed a petition against Berkeley County Planning Commission and its recent decision to approve a residential development (Ridges of Tuscarora) near their community. “Our main concerns are that a community with 95 homes and 95 wells is going to deplete the quantity and quality of our water” said Richard Rauch, a member of Concerned Citizens of Tuscarora. [MJ Nov 11]
· A decision handed down by West Virginia Supreme Court of Appeals reversing a decision by Jefferson County Circuit Court is expected to expand rural land use rights in the county. “This is a major victory for development in Jefferson County” said attorney Nathan Cochran who represented Buckeye Development LLC and Jefferson Utilities Inc. This decision reversed the ruling in the Circuit Court 2004 case by Judge Steptoe. In this case Steptoe ruled that BZA zoning administrator Paul Raco did not have the authority to score properties, or otherwise comment to the BZA about housing development requests. [Dec 3 MJB]
6. Lending News
The average for the 15-year FRM this week is 5.79 percent, with an average 0.6 point, down from last week's average of 5.85 percent. A year ago, the 15-year FRM averaged 5.18 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.82 percent this week, with an average 0.7 point, up from last week when it averaged 5.78 percent. There is no annual historical information for last year since Freddie Mac only began tracking this mortgage rate at the start of this year.
One-year Treasury-indexed ARMs averaged 5.22 percent this week, with an average 0.7 point, down slightly from last week when it averaged 5.15 percent. At this time last year, the one-year ARM averaged 4.17 percent.
"Long-term mortgage rates dipped this week because of recently released inflation indicators for November, while short-term rates rose, responding to the Fed's recent -- and expected future -- actions," said Frank Nothaft, Freddie Mac vice president and chief economist. "Although mortgage rates by and large are higher than they were at the start of this year, they've only risen about one percentage point since hitting a four-decade record low in June of 2003."
"Meanwhile, new home construction in November rose by 5.3 percent, the most in seven months, giving a strong signal that the housing market still has a good bit of sparkle left in it."
[Realty Times]
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