Sarah Jarvis Team at One South Realty

at One South Realty

Development

The Sky Isn’t Falling

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Oh, I hear it, too –– ‘These house prices are unsustainable’ and ‘just wait until the interest rates rise’ or ‘remember what happened last time.’

< yawn >

When it comes to housing, nearly everyone has become a Chicken Little and is predicting that the ‘sky is falling!’ As a matter of fact, the whispers of an overheated market date back to 2015 when home prices started rebounding quickly from the depths of the 2008 crash.

Doomsaying is an industry unto itself so forgive me if I don’t pay attention to the people who predict gloom for a living. If you keep saying the same thing for long enough, eventually you will be right.

Personally, I would prefer to be right more often than ‘eventually.’

The Real Deal

Instead of blindly assuming that prices are going to come crashing down because they went up, lets look at where the market actually stands:

Building

Inventory

Rents

Mortgage

Other Economic Factors

We’ve Never Been Here Before

No housing market has ever been exposed to the combination of factors that are in play today –– a rapidly expanded money supply, record setting inflation, disrupted supply chains, a pandemic, global unrest, a systemic lack of building, population growth, ‘Sun Belt-friendly’ migration patterns, and the decoupling of geography from employment (in other words, live where you want to and use Zoom.)

There is no precedent for this market so using using history as a guide is pointless.

Remember, market corrections occur when prices are overvalued, and not just because prices went up.

The bottom line is that if someone predicts a housing crash but doesn’t say why, when and/or by how much, then they should be ignored.

Millennials turning 30 + 5M homes undersupplied is what is today’s market –– and we can’t fix that overnight.

Is Your Realtor Buying Property? (Or just telling you to?)

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I am sure you have heard a Realtor say it –– ‘It’s a great time to buy or sell real estate!’

Yeah, it is rather obnoxious.

Admittedly, I don’t like the statement either, it feels not only very self-serving, but very thoughtless. It really isn’t saying anything at all –– just a recommendation to do something –– which flies in the face of legitimate thoughtful advocacy (but I digress …)

That said, it does beg an interesting question, what is YOUR Realtor doing? Are Realtors buying right now with prices as high as they are? Are they dumping everything they own thinking the market is about to tank? Are they telling you to buy but others to sell? Are they recommending what is good for you, or for them?

The bottom line is: Does their advice match their behavior?

Let’s discuss.

The ‘Agency’ Problem

The ‘agency’ problem is basically defined as follows –– it is when the representative for an individual (Realtor, stock broker, attorney, etc.) makes money regardless of whether the deal works out for the individual represented.

​​Don’t tell me what you think, tell me what is in your portfolio.”

Nassim Taleb –– Skin in the Game

In other words, if you buy a stock, or home, or car, and the value goes down, does the representative that recommended you buy it (the agent) feel the same financial pain? If they do not, then you (probably) have an agency problem –– one where the only the client suffers from the bad advice, not the agent.

As a very much younger version of myself, I remember a sage developer once telling me that he would be more than happy to build what I said he should, provided I covered his losses if it didn’t work out. And while I was taken aback by the statement initially, I quickly came around to understand what he meant. 

If he followed my advice and I was wrong, he was the one who lost –– not me. It was simply a way of saying, ‘Put your money where your mouth is.’ 

I never forgot the lesson.

Are We Buyers or Sellers?

So it begs the question, are agents buying or selling right now? And being even more specific, are WE buying or selling right now?

The answer is, yes, we are.

Wait, what, you said ‘yes’ to both. Are you buying OR are you selling?

The answer is more specifically, yes, we are doing both.

When We Are Sellers

We are selling a few things in our portfolio for various reasons, but they are not related to an expectation of a market crash.

Our house in OBX had extraordinary sunset views.

We are doing what is best for our portfolio.

The Beach House

We recently sold a vacation home we had owned for many, many years (in full disclosure, I LOVED the place, but it was time to let it go.)

Why did we sell it? For two reasons:

  1. We had a floating rate mortgage on the home, and due to the nature of vacation (2nd) homes, refinancing the property into a fixed rate mortgage was not feasible. We saw indicators that mortgage rates we due to rise and we didn’t want the exposure to an increased mortgage payment, regardless of the appreciation potential (or sunset!)
  2. The home was due for many deferred maintenance items that would have required significant capital investment. In other words, we had some expensive repairs on the horizon that would have required a lot of cash that we did not want to lose access to.

And so we sold it –– in a weekend.

Replacement and the 1031 Exchange

We then used a 1031 tax-deferred exchange technique to shelter the gains, and then bought both an office property (near Willow Lawn) AND a single family rental home in Kilmarnock (near the River) ––  and we were able to secure long term fixed-rate financing at a very low rate. 

From a strategic standpoint, we were able to remove a poorly financed property from our portfolio (that also was extremely unpredictable in its yearly maintenance costs) and replace it with two low maintenance properties financed at a 3.1% fixed rate.

And did I mention we actually upped the cash flows at the same time?

Great outcome.

So, yes, we technically sold one property (which made us a seller) but subsequently purchased two others to replace it (which made us buyers.) And we did so to reduce the risk in our property portfolio for reasons relating to mortgage finance, cash management, and tax impact –– not for fear of a market crash.

The Family Rental

In addition to the sale / purchase referenced above, we are also considering selling a property that we had owned for years as a single family rental (it is currently under contract.) 

The reasons we are doing so have less to do with a bet on the market dropping (we will simply go and buy something else similar with the proceeds, so we are still betting on appreciation) but more for a reason related to family. The home was leased by a family member and when they moved out, it felt better for all parties involved to find a new owner. 

So the reason we are selling is not to take money off the table in fear of a market collapse, it is due to a what is best described as a ‘non-economic’ reason.

The fact that we will be purchasing a home to replace it indicates our belief.

We are Naked Buyers, Too

OK, not actually naked per se –– I mean we are also buyers even we when don’t have things to sell.

In the past few years, we have added to our portfolio, over and above replacing the properties we sell.

Specifically, we have purchased a home with each of our eldest children, and are actively seeking to purchase more for investment purposes.

What did we buy, you ask? One is located in the ‘VCU Bubble’ and will always rent well (so the downside is extremely limited,) and the other is a super cute brick cape cod in the near west end (again, location and size make it very low risk.)

And yes, just like our clients, we had to win a bidding war ($40K over ask, btw) with a waived inspection clause in order to secure it –– what is good for the goose is good for the gander, right? We get the pain and uncertainty of the process.

Why put ourselves through the pain of a bidding war and the risk of potentially buying something with a lot of repairs in a market that seems overpriced? Because we are bullish on housing and we wanted to make sure that our kids had a chance at ownership in the same way that we did when we were their age.

So, yes, we are putting our money where our mouth is and we are making the same bet with our own children that we are asking our clients to make.

Other Strategies

We are also actively seeking land to develop or properties in need of renovations.

Buying housing does not scare us.

In addition to residential property, we are also looking for small office properties where we can find ‘value-add’ opportunities such as building on more space, carving off lots for development, and / or undertaking aesthetic upgrades.

We are lucky in that we have the benefit of experience to see how all forms of properties can be improved and thus our search box is bigger than most, but we are still buyers –– regardless of the asset class.

Again, we see demand well outstripping supply for the foreseeable future and nearly all forms of ownership (especially when financed at today’s rates even though they are up 25% from last year) are still a phenomenally safe play. 

The Bet We ARE Making

So to answer the question above, are WE buying or selling? The answer is that we are only sellers when we can replace what we sell.

And when we do sell, we are selling for reasons NOT related to a market crash, but rather for other strategic reasons, and we are replacing what we sell using the 1031 tax deferred exchange provision in our tax code. 

In other words, we don’t want to relinquish property at this juncture and give up the potential appreciation on any portion of it because we see more upwards pressure on pricing than we do the opposite. 

As a matter of fact, with inventory levels hovering where they are currently, the monthly appreciation is expected to be 2-3% per month (and no, that is not a misprint.)

Furthermore, we see not just property values rising, but rental rates rising as well. 

Focus on the Facts

Regardless of the events in Eastern Europe, or the interest rates, or inflation, or COVID –– the housing stock of our country is shockingly below where it needs to be and the 20 – 40 offers per listing indicates that demand is nowhere near abating (and yes, we track the number of offers, it is a phenomenal measuring stick for market momentum.)

As a matter of fact, since the beginning of 2022, the increase in interest rates has not impacted pricing whatsoever –– despite the predictions otherwise.

Am I being myopic and ignoring market crash indicators that will become obvious after the fact? Perhaps, but having lived through 2008, I am acutely aware of the conditions that caused that market to crash last time and none of those conditions exist today. 

When your market is 5M houses undersupplied, it is hard to see how things change.

The bottom line is that we see pricing continuing to escalate, with only a soft landing and flattening when the market returns to balance sometime in 2026 or 27 if we are lucky –– not the 30% drop of 2008. The lack of inventory makes a huge adjustment highly unlikely.

So just to reiterate, my money and my mouth are in the same place –– and we lived through 2008.

Have? Have Not?

The bottom line is that property ownership is increasingly becoming the dividing line between haves and have nots.

It isn’t fair, but it is an unfortunate reality (you can read more about my opinions here.)

The policies and decisions that led us to this predicament are long standing and incredibly tough to reverse. And even if they are ever reversed, the time required to build enough homes to satiate the demand is well over the horizon –– especially at the market’s entry price points. 

Housing has never really been, nor should it ever be, a short term thing –– like 1,000 shares of Apple or Bitcoin. You buy housing to own it for a years.

So yes, we are both buyers and strategic sellers –– but more than anything, we are owners and will continue to be so for the long haul. 

2022 Market Housing Market Forecast

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Each year, we try to push out our thoughts about the housing market in the coming year.

2022 is no different.

The presentation we did this year we feel is one of the most important ones we have ever done.

Why?

Because the market conditions are quite frankly, unprecedented.

At no time in our history have we had so many extreme inputs to the market –– from inventory to stimulus to mortgage rates to inflation to migration –– everything.

To offer you a taste of what is in the presentation, here is a sample of what we see coming:

  • prices should continue to increase –– even possibly spike again
  • mortgage rates should rise
  • inventory conditions will continue to be near historic lows
  • migration to our region has never been higher
  • 2008 vs 2022 price analysis
  • new housing difficulties

And so much more…

Enjoy!

The Best Time to Build a House –– EVER!

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The world is weird right now –– no one will argue that.

The world is also quite uncertain now, too –– and I don’t think you will get an argument there, either. 

But that said, there has never been a better time to build a house –– and I will gladly engage in an argument as to why that is true.

Disclaimer

Now, when I say it is a great time to build, I am talking about the market, and not necessarily about the individual. 

If you are on an uncertain financial footing, then, no, it might not be a great time to build. Those whose industries are in the midst of a major reset or have exposure to a resurgence of COVID, then any long(er) term plans should probably be put on hold and liquid assets hoarded.

But for those whose financial positions are solid, there has not been a better opportunity to build a home in the last 50 years, if not longer.

Inventory 

Let’s begin with housing inventory.

Simply put, inventory was at record lows headed into COVID –– and COVID only exacerbated the problem.  

In the latter part of February and early March, inventory locally (and nationally) hit all-time lows. To give you a sense of the level of low, look at the chart below. 

The chart below shows inventory by MONTH

The chart below shows inventory by UNIT COUNT

Some submarkets had roughly 1 month of inventory, with most still operating with as little as 3. (For context, a market is considered balanced when it has 6 to 8 months of inventory.)

Each year that we have distanced ourselves from 2008, inventory has become increasingly more rare –– and 2020 was shaping up to be even lower than a record-low 2019.

Now, instead of the normal increase in resale inventory that typically appears for the spring market, COVID caused many homeowners to wait and NOT bring their properties to market.

NOT HELPFUL, COVID!

The traditional ‘March to May’ bump in available homes never materialized this year, and thus, the market has even fewer choices than last year’s ridiculous record low.

Perhaps the decision to sell will come later, but for now, the houses that we need to satisfy even a somewhat tempered spring demand are simply not there. 

The spring of 2021 will be absolute insanity.

Production and Housing Starts

So pretend for a moment you are a banker –– what is the first thing you do when the economy goes sideways? 

You stop lending, of course.

Credit contraction is the first reaction to economic upheaval and the one thing that the Fed and Treasury need to combat in order to minimize the impact of any financial crisis. 

So if you are a bank, are you going to encourage new home construction when you really have no idea how COVID will play out? Of course not. 

And therein lies the rub …

The homes that are currently under construction are almost all a result of contracts written last fall and this spring prior to COVID. 

In our market, roughly 50% of the homes built in any given year are ‘speculatively’ built (in other words, the home is started without a contract in hand in ‘speculation‘ that a buyer will emerge prior to completion.)

Housing starts had just started to recover to historically normal levels (see the chart above) in an attempt to make up for the decade long deficit in new home production –– oh well, so much for building the number of homes we need to.

So just to make sure you realize –– the market for new homes had been undersupplied for close to a decade AND the normal number of new homes that would have been speculatively built to try to handle the demand are not going to be started!

Uh-oh.

The lack of speculative building will manifest itself in the spring of 2021 and will mean a greatly reduced pool of new homes to choose from. With inventory levels already stressed, the lack of new homes will make homeownership even more challenging.

Preference Shift

One of the more interesting patterns to emerge from COVID is the population exodus from the large east coast metropolitan areas to smaller cities and/or suburbia.

Click the image to read the article.

COVID punishes density and places like NYC are already seeing a population electing to flee vertical properties, public transportation, and high cost of living for some grass, the (perceived) safety of their own car, and overall affordability.

Besides the safety aspect, Zoom and other virtual meeting platforms have proven that expensive office space and cumbersome travel is not as necessary as we thought to connect with clients.

Furthermore, the leading wave of the Millennial home-buying generation was already poised to begin the transition out of the cramped 1 bedroom apartment anyway –– COVID is simply accelerating the emergence of the trend.

This demographic shift will not be felt as acutely as some of the others discussed here, but over the longer haul, it will impact the need for more new construction and alter the distribution of population along the eastern seaboard.

Material Costs

So guess what COVID did to global demand? It basically killed it.

As much damage as COVID has done to the US economy, it pales in comparison to what happened (and is still happening) in China, Russia, much of Europe, and the Middle East.

Click the image to read the article.

In the latter part of 2019, much of the world was already arguably in a recession, and the onset of COVID has devastated what was already a weak global economy.

We’ve all heard about COVID’s impact on oil markets (literally negative pricing), but the cost of the other commodities has also plummeted. Metal (steel, iron, aluminum, copper), wood products, and other essential commodities are all down sharply due to lack of demand and will likely stay down as global demand abates.

So the good news here is that the cost of building a house has actually come DOWN for the first time in decades –– and that spells opportunity for those in position to take advantage of it.

Fear

Just so you realize, the largest one month drop in the Builder Confidence Index happened in April. 

Housing Market Index

BCI is now on par with the years immediately following both the Financial Crisis of 2008 and the 1987 Crash.

New construction sales have slowed precipitously, and the majority of the work in residential construction is the work that was contracted during the 2019 fall and early 2020 spring. 

So while I don’t think I would call builders desperate, I would call many of them concerned, and the opportunity to secure a good price is far greater now than it was even a few months ago. 

As Warren Buffet is so fond of saying, ‘When others are cautious, be bold.’

Interest Rates

And of course, there is the interest rate.

Whenever financial interruptions occur, the first thing the Federal Reserve and/or Treasury do is to relax monetary policy. In other words –– they make borrowing money cheaper.

Why? Because cheap money (typically) encourages economic activity. 

In the same way that the cost of oil is in everything, so is the cost of money –– and when borrowing is cheap, it makes a lot of sense to borrow for long term purchases. 

If you are going to borrow money, now is a phenomenal time to do so.

No Bidding Wars

So the cute little renovated bungalow you have been waiting for just showed up in MLS and showings start Sunday. You ping your agent and several texts later you are set to see the property at noon on the first day.

Buying today can feel like an auction

When you show up, you find out that you are one of 20 showings that day and the seller already has 3 offers in hand (2 are over the asking price,) and they are expecting another 5 more.

Ugggg.

Just so you realize, the scenario I just described is not as uncommon as you would think –– it is due simply to the lack of inventory.

So in order to be the winning offer, a purchaser will need to waive the inspection contingency, the appraisal contingency, and put down as much cash down as possible. And did I mention that you will probably also have to offer more than the asking price?

For many, that is next to impossible.

Now, imagine a scenario where you get a new home, with a full set of warranties, no waiver of inspection or appraisal contingencies, and you are the only offer.

I fully recognize that new homes tend to be built in new communities and the appeal of the 1950s renovated bungalow in a mature walkable neighborhood is powerful. But winning a competitive offer scenario is beyond many people’s means.

So if you are not in a position to win a competitive bid, then building a home can make a lot of sense.

Summary

Yes, I get it. It is hard to look at the condition of the world and think, ‘Hey! I have an idea –– let’s build a house!’

That said, the US economy is far less tied to the world’s economy than most realize, and thus, pay more attention to what is happening within our borders than outside of them. The news abroad is ugly for sure, but the US tends to be the exporters of recessions, not an importer of them.

There is still a reset that needs to occur for sure –– hospitality, travel, office space –– they all need to figure out what the new normal is. That will take some time for sure and cause some pain, but it will get worked out.

Other economic impacts aside, when you step back and take a long view, you will realize that the housing market was already massively undersupplied –– and COVID actually worsened the problem, not helped it.

So to repeat:

  • Resale inventory is at an all-time low
  • New home speculative building has largely ceased
  • A demographic shift away from the crowded northeastern urban markets is already underway
  • The cost of materials is at or near 20-year lows
  • Builders are a bit fearful and likely to be aggressive to win deals
  • Mortgage rates are stupid low
  • No bidding wars

I simply cannot imagine a better time to build a house. 

What to Expect in 2020

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Forgive me, readers, for I have sinned. It has been 4 months since the last blog. Got busy, you know? Had a lot going on this year.

I’ve been busy …

But that said, there is no better time to jump back on the writing horse and no better topic than the predictions for the coming year, which has become a bit of a tradition on the blog.

So without any further adieu, here are the things we are keeping an eye on and some trends we are seeing (and feel we will continue to see) as we move through the next 12 months.

Navy Hill

For those of you who are not aware of Navy Hill –– well, you should be. Navy Hill is the proposed redevelopment of the Richmond Coliseum and the surrounding blocks into a new 18,000 seat arena plus beaucoup office, residential, and retail space.

When completed, it stands to be the most transformative project the city has seen in 50 years.

Photo courtesy of Navy Hill.

To say the least, it is a pretty big deal.

Opposition is Loud

Any development project will bring with it its share of opposition, whether it is a simple townhome project or a large planned community –– that is the nature of development.

But when you start talking about a project on the scale of Navy Hill ($1.5B, if you are asking), then the opposition increases exponentially.

And thus it is with Navy Hill.

So as the noise gets louder, make sure to separate logical and thoughtful opposition from the ‘I don’t like change’ opposition. Sometimes it is difficult to tell the two apart.

Decision on 2nd Dominion tower looms large over Navy Hill project
Want to know more? Our good friends at Richmond Biz Sense are, as always, on top of things.

So 6th Street Marketplace Redux?

So what makes this project different than, say, the 6th Street Marketplace debacle of the 1990s, or the ‘comedy-of-errors-effort’ at building a baseball park in Shockoe Bottom, or even the horrible deal cut with the Redskins for training camp?

Well, two basic reasons:

  • The development team is extremely accomplished at sports arena/ballpark redevelopment
  • The city isn’t acting as developer, they are SELLING the land to a private development group

The TIF (not the TIFF!)

The basic deal is that the city is selling the land to the developer and then using a form of financing called a TIF Overlay District (Tax Incremental Financing) to pay for the new arena and infrastructure.

The tax revenues from the improved values in the district would be what pays off the debt –– and once paid off, the city would not only own the arena outright, but they would have an insane amount of new tax revenue flowing into their coffers.

Map courtesy of Richmond Biz Sense

Good News. Bad News.

The good news ––  the City will NOT be the developer. The City of Richmond has repeatedly shown that they are terrible at playing developer. And (more good news), they will have activated a tremendous amount of taxable land in the middle of Downtown that currently brings them no revenue.

The bad news –– well, what if it doesn’t work as planned? And don’t the schools need money now?

Yeah, there is that …

Ambitious, But Transformative

The plan is ambitious for sure, but the development team is extremely accomplished. The lead architects were involved in some of the most high profile sports arena developments in the US –– Quicken Loans (Cleveland Cavaliers), Staples Center (LA Lakers, Clippers, and LA Kings), and America West (Phoenix Suns) to name a few.

Another project from Future Cities. The new home of the Golden State Warriors

I, for one, would love to see it happen. The number of concerts, sporting events, and other entertainment productions that skip Richmond currently is frustrating –– especially for a lifelong Richmonder accustomed to seeing of the best shows ever right here at our own Coliseum.

Furthermore, the idea that something like 10 Downtown blocks are currently NOT providing revenue (it actually costs money to maintain so it is technically a drain on revenues, but who cares about such minor details) to a city in such desperate need of fixing its crumbling schools also appalls me –– especially when you see the impact that a sports/entertainment district anchored by office, retail, and residential development has had on other cities.

Yes, the schools are in dire need of additional funding, but so is every other department. When your revenues are fixed, paying Peter means robbing Paul.

So stay tuned –– there is a lot more to be said and written about Navy Hill.

Moving East

Have you ever really looked at a map of Richmond’s development?

If you have, you are one of the few.

Red means old. Green means new. Can you see the difference in the direction of development?

By and large, it moves from the fall line of the James River (i.e. Downtown) and moves primarily up the river (west and north) and out Midlothian Turnpike, Hull Street, Broad Street, and along 95.

What it does not do is move east at anywhere near the same pace as it does in the other directions (see the map.)

Well, that is starting to change.

The Rise of the East

Back in the days when the cleanest air and water were upwind and upstream, moving west made a lot of sense.

Today, the impact of pollution isn’t nearly the same as it was in say, 1930, and thus the need to continually go west isn’t nearly as strong. And the quest to find reasonably priced housing that isn’t 45 minutes from urban Richmond is leading the change in attitudes.

The first chart shows the $/SF of the two easternmost high schools in Henrico County (Varina and Highland Springs.) Look not at the amount per square foot –– but the rate of change –– when compared to the two westernmost high schools in Henrico (Godwin and Deep Run.)

Bet you didn’t expect that, did you?

Now, take a look at what is happening in the North Church Hill neighborhoods, as well as those to the east of Chamberlayne between Laburnum and Brookland Parkway.

Notice anything? Oh, just pricing that is up anywhere from 3 to 5x since 2011.

Wait, did you say 300 to 500% since 2011?!? Yep.

Affordability

What is driving the change? Affordability (well, at least for now.)

As the prices for entry to the Fan District, Museum District, West End, and even the new home communities in Midlothian and Moseley are reaching into the middle to upper $400’s, people, especially the first-timers, are looking for housing that is both affordable and close in.

Check out the pricing for new housing in four of Chesterfield’s largest new home communities on the chart below:

Cue ‘the east.’

Pricing below $400k, 10-15 minute commutes, and a rapidly growing amenity base are what is underpinning the growth –– and as more and more investment occurs at points east of 95, the better the appreciation will get.

The smart investors are already there.

Inventory

A Growing Metro

Question –– do you know what the rate of population growth is right now in the Richmond region? (And by region, I mean the City of Richmond and surrounding counties)

Regional Demographics
Some interesting stats about our region.

Answer –– Depending on what you read, the population growth in the region is between 1% and 1.5%.

Now that doesn’t sound like a big number until you do the math.

1.3M people x 1% = 13,000 new people each year.

That is a little over 1,000 people per month.

And that is roughly 35 people per day.

Think about that number for a second –– 35 new people per day are moving to Richmond. WHERE IN THE WORLD ARE THEY GOING TO LIVE?

Now you see the problem.

Median Income

Want me to blow your mind even more? The median income in our region is $65,000.

$65,000 translates to roughly a $250,000 to (maybe) $300,000 home in terms of buying power.

Guess what? There is less than 2 months of inventory below $300k in the Richmond region.

Spoken differently, there is twice as much inventory ABOVE $300k than there is below it.

So here we are.

Crisis Mode

Several years ago, we wrote about the coming affordability crisis in housing. Well, it is finally here –– and inventory (or the lack thereof) is the primary culprit.

To quote the great Roger Daltry –– Meet the new boss, same as the old boss! (and I start the video right at his famed scream …)

So until we either find another 1,000 acres in the middle of the city (not going to happen,) or we rewrite mortgage financing to allow for vertical development (not happening fast enough,) we are going to keep seeing prices spike –– especially in the more affordable segments.

Manchester

We were just in Manchester doing a video shoot for one of our listings and man, it has gotten tall. Like really shockingly tall. And I would like to think that I know a lot about Manchester and even I was shocked.

It is tall.

< Don’t believe me? Check the references to ‘Manchester + Tower‘ in Richmond Biz Sense >

For those who do not know much about Manchester, you should. It is basically becoming an entirely new city.

The Terraces at Manchester recently sold for $30M

The amount of development that has occurred in manchester is unprecedented, especially by Richmond standards. Towers, towers, and more towers are now the norm, as is new retail, new residential, and new office.

And did I mention the towers?

Housing

So what impact do you think all of this development had on house prices in Manchester? Yeah, you guessed it –– they went UP!

If you haven’t been to Manchester in a while, I highly suggest you walk the T Pot Bridge, grab a beverage at Legend, and take a look. You won’t believe the activity.

What We Didn’t Talk About

So we left off several topics in hopes of a) making this post of reasonable length and b) leaving something else to talk about over the coming year.

But here are some of the things we did not touch on:

  • iBuying –– having a company like Zillow buy your home
  • Building Costs –– still going up!
  • Politics –– sorry, I don’t have the stomach to write about it
  • Scotts 2.0 –– the Westwood Tract redevelopment (i.e. the industrial neighborhood just west of Scotts Addition)
  • Sauer Center –– can I please just have my Whole Foods?!?
  • 2020 Census –– should be interesting, to say the least

So look for us to tackle a few of these topics in the coming months.

And Finally …

2019 was another banner year for One South. We got a lot done.

Performance Metrics

We broke our prior year’s record for transactional volume.

We cracked the Top 10 in volume (by office) in our MLS.

And we still outpace the market averages in pretty every important metric:

  • Median Days to Sell –– 8 days
  • Median Percentage of Asking Price –– 100% (yeah, that’s not a misprint)
  • $/SF –– $31 above the market average
  • Price –– $30k above the market average.

AND we have continued to conduct our business in an ethical manner (i.e. –– another year of a spotless record with all of the governing bodies.) That makes me especially proud of not just One South’s agents, but of the management team and staff who play a huge role in both our agent’s success and our consumer’s experience.

So to summarize –– more transactions at higher prices with smaller discounts and at a faster rate than the market, all while maintaining the highest level of ethical behavior –– not too shabby.

Expansion

We also grew geographically.

Our new office in White Stone, moments from the Rappahannock River

We recently opened another satellite office in White Stone, Virginia (along the Chesapeake Bay) and are in the process of partnering with a videography firm to even better promote the listings we carry and the neighborhoods we frequent (more on this soon.)

Commercial

And did I mention how well our commercial team is doing? Just read Biz Sense and you will get a sense of how well …

Salomonsky sells Shockoe Slip apartments building for $8M
Oh, just another $8M sale…

The One South Commercial team continued to grow their name and presence with more high profile sales, additional team members, and a new best for volume.

In Closing

We fully expect 2020 to be another banner year for us as the economy remains strong, interest rates low, and our region continues to attract new residents.

Most prognosticators expect the market to get started even earlier this year (but that also depends on the sellers and the weather, so stay tuned.)

And while we expect to see a bit of a slowdown around the election (it happens every election year), don’t sweat it –– just plan accordingly.

Thanks and we look forward to serving you in the coming year!

804.201.9683

How Do I Schedule a Showing?

I am Kendall C. Kendall, Client Care Coordinator for the team. I am a licensed Realtor and it is my job to answer questions and schedule showings for the properties shown on our sites. Here's our call policy.
kendall@richmondrelocation.net

804.909.0184

How Do I Determine What I Can Afford?

With over a decade of mortgage industry experience, Chris knows what it takes to provide the very best service for each of his clients and truly believes in forming lasting relationships with his customers.
Cowens@southerntrust.com
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Equal Housing

The Sarah Jarvis Team agrees to provide equal professional service without regard to the race, color, religion, sex, handicap, familial status, national origin or sexual orientation of any prospective client, customer, or of the residents of any community. Any request from a home seller, landlord, or buyer to act in a discriminatory manner will not be fulfilled.

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All of the information displayed here is deemed to be gathered from reliable sources but no warranties, either express of implied, are made part of this site. Additionally, the IDX Feed for listing information may contain descriptions of properties not represented by One South Realty, its agents or staff and any violations or misrepresentations are the sole responsibility of the listing brokerage of the subject property in violation.