Melissa Loughridge Savenko

Well, this report was released a few weeks ago, I thought I'd post it, it is still pretty interesting. I've included the ENTIRE 21-page report here, and the 2-page synopsis here. The report is prepared by George Mason University, and contains some interesting information, like:

• Sales increased 63% between the 1Q and 2Q of 2009, a larger-than-average Spring "bump."
• 48% - almost HALF! - of the sales in the Richmond metropolitan region for 2Q 2009 were under $200,000, compared to 37% of sales in 2Q 2008.
• Homes under $200,000 spent an average of 73 days on market ("DOM"), compared to 100 DOM for homes priced $400,000 or more.
• In the Richmond Metropolitan area, sales were down 11% in 2Q 2009 compared to 2Q 2008, but that was the smallest sales decline in the past three quarters.

Most of the data seems to confirm what we real estate agents are seeing every day - the buyers out there are predominantly first-time home buyers, typically buying in the starter home price range. Other buyers are taking their time and being EXTREMELY picky.

I suspect the 14% price decline 2Q 2009 over 2Q 2008 can probably be attributed to the larger-than-average number of distressed sales - short sales and foreclosures. Right now, bargain hunters with cash can pick up amazing deals, particularly in the foreclosure arena. Short sales can also be a source of great deals, but often those transactions take longer and involve lots more paperwork and hassle. So know what you're doing - or work with a real estate agent that does - if you plan to buy a short sale property. Oh, and I'm always available to assist as a buyer's agent, familiar with both foreclosures and short sales. [:)]

Anyway, the sales data for residential real estate is showing signs of improvement. Unfortunately, people are still worried about their jobs, and being understandably cautious about making a major investment, like a new home. So I think we're going to have to wait it out and see if consumers start to have more confidence in the market, and get off the fence while inventory is high, and prices and interest rates are low.

Good luck to everyone out there in this really tough market. I prefer to be a "glass half full" girl and hope that these small signs mean things are looking up, and we've moved past the bottom, possibly in 2Q 2009. Fingers crossed that I'm right!

I don't think lots of buyers know that the First Time Home Buyer Tax Credit EXPIRES November 30, 2009. If your purchase isn't closed by that date, you are out of luck, do not pass go, and certainly do not collect the $8,000 tax credit the federal government is handing out to savvy first time home buyers.

What does that mean? Well, let's work backwards on the time line and make a few assumptions:

• The offer date is NOT the critical date. The ratification date, the date the contract is accepted, is the date from which all critical next steps are measured;
• Initial offers, especially in this market, where buyers want to offer well below the list price, usually require negotiation, which can take one to four weeks;
• After the offer is accepted, the transaction must typically "clear" some critical contingencies, including (i) financing; (ii) inspection; and (iii) appraisal. ANY ONE OR MORE OF THESE CONTINGENCIES MAY HAVE TO BE NEGOTIATED, WHICH WILL ADD ADDITIONAL TIME TO THE CLOSING TIME LINE;
• The stupid Home Valuation Code of Conduct ("HVCC") will continue to wreak havoc with Fannie and Freddie insured loans;
• Lots of first time buyers will be using FHA financing, because it requires only 3.5% of the purchase price as down payment and has more generous credit score requirements, meaning your credit can be less than stellar;
• Other government loans that permit 100% financing, such as USDA and Veterans Administration ("VA") loans, will have even more onerous paperwork and "processing" requirements; and
• Frankly, even conventional financing - 20% down or more - is taking longer because of the HVCC and because of loan officer workloads with both sales and refinances.

SO, I think the lesson is, thirty (30) days from contract to closing in this environment is EXTREMELY ambitious, in light of the factors above. I think even sixty (60) days may be ambitious. I would not want to be the buyer who closed December 1, 2009 and essentially gave away $8,000 dollars. So I advise first time home buyers to give themselves at least ninety (90) days to close a deal.

And guess what that means? If you buy my analysis, you need to be making an offer by August 30, 2009. That's six weeks away. That seems to come as a shocker to lots of people, who think they have all the time in the world.

Don't miss the boat. Buyers right now don't seem to have any sense of urgency, and I feel like for many it's because they do not understand this time line. I'd sure as heck be kicking myself if I missed out on $8,000 because I waited too long to move on a house that I knew I wanted to buy. Time IS running out. Good luck, and may the force be with you!

I know the article naming Church Hill as the 10th Most Dangerous Neighborhood in the U.S. has caused an uproar, especially among people who live there and love it. And one commenter has noted that she feels much safer in her Church Hill neighborhood than she does in the Fan or Museum District. So it got me to thinking....

What is the truth about crime statistics in Richmond's urban neighborhoods? Is Church Hill safer than the Fan? Was the article naming Church Hill the 10th Most Dangerous Neighborhood in America unfair and based on inaccurate information?

NOTE: In the interest of full disclosure, I freely admit to being a total Fan groupie. I've lived here for more than 12 of the 15 years that I've been back in Richmond post-college and Big Easy, except for about 2.5 years near the University of Richmond while I was in law school. And I've been in my current house on a side street between Floyd and Grove since 1999. I'm a single mom with a young daughter and perhaps I'm naive, but I've never felt afraid in my home or my neighborhood. But this topic comes up a lot, and often from suburbanites concerned about the big, bad City. So I'm curious about the actual facts on City of Richmond neighborhood crime statistics.

Here's what you can do: You can go to the City of Richmond Police Department and search the crime statistics various ways - by census tracts, civic association, council district, neighborhood association, etc. Here is a link to the Crime Incident Information Center.

But here's what I see as a problem: I can't figure out a way to compare apples to apples, because I cannot find on the City of Richmond Police Department web site a break-out of Sector Crime reports, which would give a more accurate comparison of neighborhood vs. neighborhood. I think precinct crime reports are too broad. And using the neighborhood civic association category isn't really a good tool, because how do you define a specific neighborhood? For example, you have to figure out on the front end what you are calling "Church Hill." I realize it is probably not technically accurate, but when I refer to "Church Hill" I am including all of Church Hill, Union Hill, North Church Hill, and Chimborazo. The Fan doesn't pose the same problem, because it as a neighborhood is very specifically defined with very explicit boundaries, a result of the entire neighborhood being on the National Register of Historic Places.

So, back to the point raised by the commenter, who feels much safer in her Church Hill neighborhood than the Fan or Museum District - Is Church Hill safer than the Fan? I dunno. I can't find a way to compare Sector 313 (Fan, Randolph and Maymont) to Sector 111 (Union Hill, Oakwood, Fulton, Church Hill, Church Hill North, and Chimborazo), which I think would provide the fairest comparison.

BUT, If I run JUST Precinct One (including Church Hill) vs. Precinct Three (including the Fan) back for one full year exactly, to July 6, 2008, get the following:

• Homicide: 5 vs. 1
• Sex Offense: 22 vs. 29
• Robbery: 55 vs. 57
• Assault: 342 vs. 339
• Burglary: 74 vs. 153
• Vice: 366 vs. 217
• Theft: 265 vs. 645
• Vehicle Theft: 69 vs. 72
• Other: 1697 vs. 1875

Interesting stuff. The homicide rate in Precinct One is five times greater than in Precinct Three, but the total number of homicides overall is (thankfully) relatively small, six total. There is a higher incidence of sex offenses in the area that includes the Fan, and you are more than twice as likely to be burgled. Incidences of robbery, assault, and vehicle theft are relatively equal across both Precincts The number of vice offenses - drugs, weapons, and prostitution, I suspect - is substantially higher in Precinct One, but the number is thefts is almost three times as great in Precinct Three. And I have no idea what the "Other" category entails, but there is more of it in the Fan than Church Hill.

I will admit I didn't scour the data and I didn't dissect the methodology for collecting the Richmond Police Department's crime statistics. But, Church Hill isn't looking so terribly dangerous to me, unless I'm missing something.

So dig through the data yourself, and draw your own conclusions. And as always, feel free to share your conclusions or your thoughts in a comment. I always publish them, unless I am specificall asked not to do so.

The magazine "This Old House" has named Church Hill one of the best nine "old house" neighborhoods in the South. [NOTE: I am a little perturbed that Baltimore, Maryland and Wheeling, West Virginia were included in "the South." Hello, basic geography and Mason-Dixon line?] I also have been to several of the other neighborhoods - Meridian, Mississippi, Newnan, Georgia, Durham, North Carolina, and the Lower Garden District, New Orleans (where I actually lived after college - LOVE the Big Easy!) - so I know what an honor it was to be in the company of these neighborhoods.

http://www.thisoldhouse.com/toh/photos/0,,20283025_20634574,00.html

However, within days of this release, another organization named Church Hill one of the Top 10 Most Dangerous Neighborhoods IN THE NATION. Here's that article.

http://www.walletpop.com/insurance/most-dangerous-neighborhoods?photo=17

The data came from some site called "neighborhoodscout," which looks a lot like Zillow or Trulia, but appears to be in only the beta testing stage.

So, which is it? Awesome place to live, or scary dangerous? I've never lived there, so I'm not taking a position on the issue. I am happy to hear from anyone who has an opinion. I just think that it's the absolute height of irony, these two articles being released so close together. For the sake of our City, let's just hope good news triumphs over bad. OR, if there is a crime problem that is going unaddressed, maybe this rating as 10th Most Dangerous Neighborhood in the Country will be an impetus for some dialogue on a possible solution and re-direction of some crime-fighting resources. Let's take lemons and make lemonade!

Here are two articles which suggest that a slow, steady economic recovery may be in the not-too-distant future for Richmond. For the ultimate impact of the recession, one article puts Richmond in the middle of the Top 100 largest metropolitan areas in the United States. That means the recession has been milder here compared to about 50% of the other major metropolitan areas in the United States. For example, with respect to a decline in home prices year-over-year, the Greater Richmond Metropolitan area, which will include the surrounding counties, has seen only a 2.2% drop in 1Q 2009 compared to 1Q 2008. All in all, that's pretty small, especially compared to the figures for the LAST area on the list, Stockton, California, with a drop of 30.6% in home prices 1Q 2009 to 1Q 2008. OUCH.

The other article details a national increase in housing starts - new construction - and stabilization in wholesale prices. That data is good news, although any good news on the broader economy should be met with cautious optimism. One month's positive numbers do not necessarily a sustained recovery make.

But for those of us hoping and praying for a turnaround in the real estate markets specifically, and the overall economic markets generally, any little glimmer of hope is cause for celebration. Fingers crossed, keep it comin'.