Both Chapel Hill and Carrboro are considering proposals to lower the city tax rate that property owners are paying. Both towns are hoping to reduce the tax burden on the residents by approximately 14%. When the economy began to show signs of distress, the city managers of Chapel Hill reacted with budget cutting measures and halted some projects, resulting in a significant savings. Now, the towns are trying to reduce the burden on property owners, at least for the short term.
Orange County has adopted a tax neutral rate which will offset the increase in tax valuations that were sent out earlier this year. Tax valuations adjust the tax value of homes to reflect current prices. Because home values have increased in recent years, most homeowners saw a significant increase in the tax value of their home. The county is reducing the tax rate to offset the increase in value with the goal of a neutral tax adjustment for this year.
The American Lung Association just gave Chatham County residents another reason to love their hometown. According to a study recently published, Orange and Chatham Counties received an “A” for air quality with regard to short term particle pollution. The study based upon measurements taken between 2005 and 2008, ranked both counties with zero particle pollution.
Particle pollution, a toxic mix of soot, diesel exhaust, chemicals, metals and aerosols is the most dangerous form of air pollution according to the report. Chatham also received a passing grade for ozone.
Just another reason to call our town the “southern part of Heaven”. Now, take a deep breath and say “AHHHHH”…
Chapel Hill short sales: what buyers need to know
May 18, 2009
I am in the throws of my first short sale. If you asked me a year ago to explain a short sale, I might have thought you were discussing the summer clearance at Macy’s. Even though I knew the theory behind the short sale, the process is quite a different matter. I thought it might be beneficial to some, to share what I have found so far.
If you don’t know what a short sale is, it is a pre-foreclosure marketing of a home. The owner still owns the home, but has negotiated with their lender to accept less than the mortgage amount owed. In return, the seller has agreed to walk away from the closing with no funds but avoids having a foreclosure on thier credit history. More importantly, it allows the home to be marketed at a price that will get it sold. When someone is upside down on their mortgage, (owe more than market value), they can’t sell their home unless they can come to the closing table and write a check to their bank.
Things get complicated when the offer is written. Although the owner has ownership of the property, the bank negotiates the offer. The offer is made to the seller, but the seller has no say in the matter. After all, the lender is the one taking the hit, so it seems fair that they should have the right to determine how much of a loss they will accept? For a reason I don’t yet understand, the offer sits at the bank for weeks until it is finally sent to a negotiator. I am told the negotiator has hundreds of files and the buyer now waits for the negotiator to respond.
Apparently, once the negotiator responds and terms are agreed upon, things happen quickly and they expect the buyers to close shortly after.
The pluses of the short sale from the buyer’s perspective is that you are getting a good value because you are buying the home at a discounted price. Unlike a foreclosure, buyers can request repairs and other negotiations. The minuses are that there is a lengthy waiting period for answers and buyers who have short closing windows may be disappointed. Also, banks can reject offers last minute or change their mind midway with no penalties.
If you are considering a short sale listing; be realistic. If you think something is too good to be true, it is! You will likely need to make a reasonable offer to acquire a short sale property and negotiations are not as easy as when you are working with a seller.
Quartz tops granite flops
May 17, 2009
When choosing counters for your kitchen or bath, I always recommend recycled quartz for a bunch of reasons. Granite is often touted as a “green” material, but I beg to differ. Granite is mined from all over the world and mining alone is good enough reason for me to not recommend it. Once mined, it must be shipped…and I can’t think of anything heavier I could choose were I trying to increase the carbon footprint associated with the transport of the material I purchase. Also, granite may emit radon gas, an odorless, colorless gas that is caused by decaying uranium (found in some granite). The final negative, and it is a big one, granite requires maintenance. If you do not properly care for your granite counters, you risk getting permanent stains.
This all brings me back to recycled quartz counters. The benefits are that it is truely a green choice because they are made from a byproduct. Secondly, they are made on our continent, keeping shipping to a minimum. Recycled quartz is readily available for about the same cost as granite but that isn’t the end of the story. Quartz counters look very much like granite but require no maintenance, ever. They are more durable than granite, offer a uniform pattern and are identical to the samples so there are no surprises at install. In my personal opinion, I think they are even more beautiful than granite.
I once ordered a bed and when it arrived, it had a distinct and very distracting line that was a naturally occuring part of the grain. It bothered me to the point that I finally asked the store to send me a new headboard. Don’t think for a second that you will be sending back your countertops should they arrive with a distinct and distracting vein. I think granite is over rated and hope that this post will serve to encourage people to explore other possibilities. Lately, it seems that all a seller has to do is to put granite counters in very low end properties to get them sold. I have to say, I don’t get it.
The weather man says pollen is moderately high. We love our long leaf pines, but the same can not be said for the flourescent green dust that blankets everything, every Spring. Right now, the area is seeing a combination of tree and grass pollens and a lot of people are suffering.
Homeowners can look to their home for a remedy. There are lots of ways to reduce allergans in the home. Simply keeping the doors closed when pollen is high, will make a difference. Install HEPA grade filters on HVAC air returns. Keeping humidity around 40% will also improve air quality (when air is too dry, pollen floats and remain airborne longer).
Hard surface flooring and leather furniture are great choices because they can be wiped down. Replace draperies with blinds and wash throw rugs often. Fabric covered furniture with washable slipcovers is another alternative.
Chatham County residents will have the opportunity to vote on whether or not they want to approve liquor by the drink tomorrow, Tuesday, May 5. Early voting has been ongoing but at limited locations. All voting polls will be open on Tuesday to determine if residents want to approve the measure.
The issue has created quite a bit of devisiveness. Some people feel it will help local business by raising their profit margins, others believe it will hurt local business by opening the door to chain restaurants. There has been a lot of bantor on the Chatlist, a local bulletin board, regarding an anonymous post regarding a ficticious post about X rated gentlemen’s club ready to move into the area. Many residents feel the county needs the additional tax revenues while others feel liquor by the drink will destroy the rural character and charm that are the essence of Chatham living.
Whether you are for or against, the important thing is to get out and vote. If you do not exercise your right to be heard, then you shouldn’t say “I told you so” later.
There is a tacky expression in the business world and I am going to be a little tacky and apply it to real estate. “No one wants to hear they have an ugly baby”. But when it comes to the first quarter Chatham County real estate statistics, I am reminded of this expression. I am going to go a step further and say I saw it coming. In my opinion, the twenty three month supply of homes is majorly caused by excessive development and uncontrolled growth.
If you are trying to sell your Chatham home, you have a good chance of finding a buyer if your home is priced under $300,000. It is no coincidence that new construction, generally priced in the 400-800 price range, is creating an unhealthy level of competition among sellers. If your home is priced in this range, you will need to distinguish your home from new construction and price it to sell. Your home must offer something new construction does not and it must be a better deal.
The first quarter of 2009 report is summarized as follows:
Anyone who would like to have the full report including the actual data, please contact me through my webiste.
2009; First Quarter summary of residential activity
On this and the following pages you will find statistical indicators detailing the performance of the residential real estate
market in Chatham County. Here are the answers to my top questions pertaining to market performance;
What is going on in the job market?
Based upon 3/09 figures released by the Employment Security Commission of North Carolina, the combined workforce in the Durham and Raleigh/Cary MSA’s was 782,122. The current level of employment is the lowest since 3/06. This is a 5.15% drop from the workforce seen at the end of 3/08. The unemployment rate in the MSA increased to 8.5% from 4.1%.
Is anyone looking at Chatham County housing?
There were 3,014 showings as logged through the CSS system during the first quarter. This is a 23% decrease compared to 1Q/08 showings.
What is happening with inventory?
Overall inventory was down 2%, re-sale inventory decreased 1% and new home inventory decreased 4% compared to inventory levels at the end of 1Q/08. The average days on market for the active listings is 155 compared to the 123 day average at the end of 1Q/08. The number of sellers who have dropped list price from original list has increased to 287 from 202.
Are more choices producing more contracts?
The answer is still a resounding no. Contract pending levels for the county were off 34% compared to 1Q/08. This mirrors the trend seen in other counties in the Triangle. TMLS contract pending levels for the quarter were off 28%.
What is happening with closed sales?
There were 90 closings posted during the quarter, a decrease of 25% compared to 1Q/08.
How long is it taking for homes to sell?
The average days on market for homes that closed during the quarter has been 102 days. The average at the end of 1Q/08 was 115 days. The average days on market for resale homes was 105 and the average for new homes was 97.
The overall TMLS average has been 103 days.
How does the current supply compare with other area’s in the Triangle?
The current supply for all housing located within the county is 23 months. This supply number is calculated using the 3 months of 2009 closings as the sales pace. The supply at the end of 1Q/08 was 18 months. The current supply of housing located in the four main counties of Durham, Orange, Johnston and Wake is 10 months.
Give me some numbers
The average list price is $499,500, an increase of 1% compared to the average at the end of 1Q/08.
The average sold price was $312,500 a decrease of 7% compared to 1Q/08.
The average sold price per square foot was $127.87, flat compared to 1Q/08.
What percentage discount off of list are buyers getting?
The average percentage ratio between final sales price and final list price was 95%. The average at the end of 1Q/08 was 97%.
Where are people buying?
Powell Place, Carolina Preserve and Fearrington closed the most amount of homes within TMLS during the quarter.
I doubt there has been a more anticipated report than the first quarter 09 market statistics. Buyers, sellers, builders, lenders, realtors….we are all trying to understand what we are experiencing. The market is slow, almost everything down 25% or more. However, there are a few glimmers of optmism in the report. Showing activity is up, giving sellers who are priced according to the market comps, a greater number of auditions. The statistics are summarized in the following report:
On this and the following pages you will find statistical indicators detailing the performance of the residential real estate market in Orange County. Here are the answers to my top questions pertaining to market performance;
What is going on in the job market?
Based upon 3/09 figures released by the Employment Security Commission of North Carolina, the combined workforce in the Durham and Raleigh/Cary MSA’s was 782,122. The current level of employment is the lowest since 3/06. This is a 5.15% drop from the workforce seen at the end of 3/08. The unemployment rate in the MSA increased to 8.5% from 4.1%.
What is going on in the Chapel Hill/Carrboro school district?
First quarter closings were down 42% compared to 1Q/08. The average sales price increased 11% to $433,000 and the median sales price increased 7% to $322,000.
What is happening with inventory?
Overall inventory decreased 6%, re-sale inventory increased 2% and new home inventory increased 17% compared to inventory levels at the end of 1Q/08. The average days on market for the active listings is 135 compared to the 105 day average at the end of 1Q/08. The number of sellers who have dropped list price from original list has increased to 355 from 306.
Are more choices producing more contracts?
The answer is still a resounding no. Contract pending levels for the county were off 35% compared to 1Q/08. This mirrors the trend seen in other counties in the Triangle. TMLS contract pending sales for the quarter were off 28%.
What is happening with closed sales?
There were 166 closings posted during the quarter, a decrease of 27% compared to 1Q/08.
How long is it taking for homes to sell?
The average days on market for homes that closed during the quarter was 109 days. The average at the end of 1Q/08 was 81 days. The average days on market for resale homes was 99 and the average for new homes was 146. The overall TMLS average has been 103 days.
How does the current supply compare with other areas in the Triangle?
The current supply based upon first quarter closings is 17 months, an increase from the 12 month supply seen at the end of 1Q/08. The current supply of housing located in the four main counties of Durham, Orange, Johnston and Wake is 10 months.
Give me some numbers
The average list price is $476,000, an increase of 4% compared to the average at the end of 1Q/08.
The average sold price was $336,700, up 8% compared to 1Q/08.
Where are people buying?
Meadowmont, Winrock and High Rock Village were the top sellers during the quarter. The average sales price per square foot was $139.59 and the average sales price/list price ratio was 95.45%. Both of these indicators are lower than seen at the end of 1Q/08. The average sales price per square foot was down 3% and I think this is a more meaningful statistic than the increase in the average sales price. Given the increase in average days on market, lower number of closings and lower sales price/list price ratio, the rise in average sales price defies logic.
What’s it all mean?
I think the most significant thing is that a lot of new construction is dominating the market. Much of the new construction is appealing to the “green seeking” buyers. These homes are higher priced because they are new (new always costs more than existing) and green features add a premium that many buyers expect to pay an up charge for. Although the average sales price is up 11%, resale prices are probably not up anywhere near that. For my readers who are interested in receiving a copy of the actual data, please contact me via my website and I will provide a complementary link to the report.
