3rd Quarter Sales Update

The information presented below is complied from data sourced via the Gillespie County Multiple Listing Service. The tracking historical sales data is grouped into categories that include: "Residential", "Rural Subdivision Lots/Tracts", Acreage, Farm/Ranch" and "City Lots". These categories are further defined by "area" (e.g. in town, out-of-town/county).



While it can be difficult to portrait a true "apples to apples" picture of current real estate sales, the numbers speak for themselves as categorized. A lot can be read "between the lines" when discussing these figures, if you would like more detailed information on these summary comparisons, feel free to contact me at your convenience.

3rd Quarter-2009

Residential-City (Fredericksburg, TX) - The total number of homes sold within the 3rd quarter of 2009 actually increased by 18.1% from sales reported within the 3rd quarter of 2008 (33 in '08 and 39 in '09). The average price of a sold property declined by 5.85% ($213,695 in '08 vs. $201,176 in '09) and the average number of days-on-market (DOM) has increased an average of 10.5% (152 by end of 3rd, 2008 vs. the current 168 days). The total dollar volume of homes sold actually increased by 11.25%. Notably, the average list price to sale price ratio (LP/SP) has remained statistically unchanged from 95% in 2008 to the current 94%.

Overall number of units sold decreased from the 2nd quarter of this year to the 3rd quarter of 2009 by 23.5% (51 units were sold in 2nd qtr. ’09 vs. 39 sold in the 3rd qtr. of 2009).

Year-to-date (vs. YTD, 2008), total units sold have decreased by 3.5%, the average price of sold units has decreased by 9.12%, the average DOM has increased by 27%, the total dollar volume sold has decreased by 12.28% and the average LP/SP ratio has remain statistically unchanged (94% in ’08 to 93% currently).

Residential-County (Gillespie County Only) - The total number of homes (w/acreage) sold within the 3rd quarter of 2009 increased by 63% from the sales reported within the 3rd quarter of 2008 (19 in '08 vs. 31 in '09). The average price of a sold property declined 28% ($512,100 in '08 vs. $368,610 in '09) and the average number of DOM has increased 25.27% (186 in '08 to 233 in '09). The total dollar volume of homes sold has increased 17.44%. Notably, the average list price to sale price ratio (LP/SP) has decreased from 93% in 2008 to the current 91%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 25.4%, the average price of sold units has decreased by 23.2%, the average DOM has held steady at an average of 208 days, the total dollar volume sold has decreased by 43% and the average LP/SP ratio has dropped from an average of 93% to the current 91%.

Lots-City (Fredericksburg, TX) - The total number of lots sold within the 3rd quarter of 2009 increased by 66.7% from the sales reported within the 3rd quarter of 2008 (6 in '08 vs. 10 in '09). The average price of a sold lot declined 15.75% ($70,042 in '08 vs. $59,009 in '09) and the average DOM has increased 35% (511 in '08 vs. 690 in '09). The total dollar volume of lots sold has increased by 40.14%.




Year-to-date (vs. YTD, 2008), total units sold have decreased by 44.4%, the average price of sold units has decreased by 17.7%, the average DOM has increased by 92%, the total dollar volume sold has decreased by over 54% from YTD ’08 to YTD ’09.

Rural Subdivision Lots/Tracts - The total number of acreage lots sold within the 3rd quarter of 2009 declined 33% (9 in '08 vs. 6 in '09). The average price of a sold acreage lot increased by 59% ($105,077 in '08 vs. $167,168 in '09) and the average DOM decreased by almost 20%. The total dollar volume of acreage lots sold marginally increased by 6%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 46.5%, the average price of sold units has decreased by 19%, the average DOM has increased by 6.6%, the total dollar volume sold has decreased by 57%.

Acreage, Farm/Ranch (All MLS Counties) - The total number of properties categorized as Farm/Ranch sold within the 3rd quarter of 2009 declined 24% (29 in '08 vs. 22 in '09). Average prices and DOM tend to be less significant in this category as the properties offered and sold vary tremendously. Most notably, total sales volume has decreased by 30.3% from within the 3rd quarter 2008 vs. 3rd quarter 2009.

Year-to-date (vs. YTD, 2008) the total number of units sold has decreased by 37% and the total volume sold has decreased by 47%

More Problems for Local Real Estate?

A relatively recent government edict known as the Home Valuation Code of Conduct (HVCC) has the potential to have a major impact on Fredericksburg, TX real estate. Anecdotal evidence suggests these effects are already being felt as deals are coming apart based on appraisals from “professionals” not familiar with our local market conditions.

The rules, which went into effect May 1 for all conventional, single-family loans destined for sale to Fannie Mae or Freddie Mac, prohibit mortgage brokers and real estate brokers from ordering appraisals and require that lenders erect a firewall between loan production staff and the appraiser. Sounds reasonable.

Problems have arisen, however, as the code is vague and confusing. In fact, the six-page HVCC is so difficult to interpret that Fannie Mae has produced an eight-page document of frequently asked questions. Freddie Mac has published guidance, too—and still many questions remain unanswered.

A very informative analysis of the HVCC has been published in REALTOR Magazine and can be found on line at: HVCC

Affordable Housing Update

The debate concerning affordable housing in Fredericksburg, TX arose again at last night’s city council meeting. Up for presentation was Johnnie Long’s Fredericks Place. Mr. Long (a well-known and reputable Hill Country builder) is in the planning stages of a 19 acre development that will ultimately provide up to 114 homes that are both “affordable” and “green”. (This project is vastly different than the ill-fated project on Highway Street that kicked off this whole debate.)

His goal is to build the development out over a 6-year timeline and to keep the prices of the four models currently envisioned to under $200,000 each. Lot set-backs will be staggered and streets will be “curvy” to provide the over-all feeling of a “non-cookie-cutter” infill development. Mr. Long is committed to “green features” such as added insulation, radiant roof barriers and high-efficiency HVAC systems (among other features).

While this presentation was not a proposal requesting/requiring council action, it was a very insightful peek into how a developer should properly prepare public and private interests for what will soon be submitted for consideration.
Mr. Long wisely provided a study evidencing the positive economic impact his development would have on Fredericksburg, TX. By setting the stage to contrast the positive impact of a long-term real estate development against what he is surely to ask for as concession from the public sector, Mr. Long begins to chip away at the base-less assertions that “give-aways” to developers serve no one but the developer.

This sly shot across the bow of the NIMBY crowd was further reinforced by handing the city a solution on how to accomplish such a feat on a proverbial silver platter. His suggestion that they consider a Neighborhood Empowerment Zone is classic “Negotiations 101” (define the problem them hand them a solution). NEZ’s are authorized under the Texas Local Government Code, Chapter 378.

While Mr. Long has quite a difficult road ahead, he has clearly demonstrated that he’s well-versed in the game. Opponents intending to make the argument that market forces have provided plenty of current housing stock priced under $200K should recall that this wasn’t nearly the case just one year ago. As our market corrects (as they always do), folks should be cognizant of how long it actually takes to put a project on the ground. We’re not arguing over conditions today or even next month. We’re talking about projecting into Fredericksburg’s future and assuming, like most things in life, housing will not be getting any cheaper.

Affordable Housing

As the debate on the role the City of Fredericksburg should (or shouldn’t) play in facilitating the creation of affordable housing resurfaces, care should be taken not to accept the stereotypes typically associated with this important topic.

Having attended many meetings/forums, etc. on the topic (both here and in other markets) it is not uncommon to hear beneficiaries of these efforts referred to as “them”, “those people” or “that element”. We can debate the intended image those terms are meant to convey but, in the end, they are always unmasked as scare tactics employed by opponents who refuse to understand the critical nature of the debate and the importance to the community of the creation of housing stock for the full spectrum of the socio-economic ladder.

Similarly, opponents seize upon terms such as “subsidy”, “give-aways” and the like to blur the fact that public investment in private enterprise can (and demonstrably does) contribute financial payback of that investment with gains to the public that reap financial rewards for years to come.

This community has been wisely conservative its choices of activities to “subsidize”. We have chosen to invest in fireworks displays, Christmas decorations, horse racing, lawn clean-up, etc., etc. Each of these has a measurable payback to the community yet are not characterized as subsidies or give-aways.

Investing in housing that is “affordable” to a large percentage of our hard-working population will pay dividends over and above any cost to the public and well into the future. Let’s focus on the big picture and not on the convenient stereotypes. The folks who make this town work should be able to afford to live here.

2nd Quarter Real Estate Sales

The information presented below is complied from data sourced via the Gillespie County Multiple Listing Service. The tracking historical sales data is grouped into categories that include: "Residential", "Rural Subdivision Lots/Tracts", Acreage, Farm/Ranch" and "City Lots". These categories are further defined by "area" (e.g. in town, out-of-town/county).





While it can be difficult to portrait a true "apples to apples" picture of current real estate sales, the numbers speak for themselves as categorized. A lot can be read "between the lines" when discussing these figures, if you would like more detailed information on these summary comparisons, feel free to contact me at your convenience.

2nd Quarter-2009

Residential-City (Fredericksburg, TX) - The total number of homes sold in the 2nd quarter of 2009 declined 18.3% from sales reported in the 2nd quarter of 2008 (93 in '08 and 76 in '09). The average price of a sold property declined 25.4% ($280,518 in '08 vs. $209,263 in '09) and the average number of days-on-market (DOM) has increased an average of 24% (166 in 2nd qtr. 2008 vs. the current 206 days). The total dollar volume of homes sold declined 39.04%. Notably, the average list price to sale price ratio (LP/SP) has decreased from 94.09% in 2008 to the current 93.02%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 15.82%, the average price of sold units has decreased by 25%, the average DOM has increased by 12.43%, the total dollar volume sold has decreased by 43.1% and the average LP/SP ratio has remain statistically unchanged.

The number of units sold registered in the 1st quarter of 2009 has increased noticeably in the 2nd quarter (44 sold in the 1st qtr. And 76 sold in the 2nd).

Residential-County (Gillespie) - The total number of homes (w/acreage) sold in the 2nd quarter of 2009 declined 18.27% from the sales reported in the 2nd quarter of 2008 (93 in '08 vs. 76 in '09). The average price of a sold property declined 25.41% ($280,518 in '08 vs. $209,236 in '09) and the average number of DOM has increased 24.1% (166 in '08 to 206 in '09). The total dollar volume of homes sold has declined 39%. Notably, the average list price to sale price ratio (LP/SP) has decreased from 94.09% in 2008 to the current 93.02%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 24.5%, the average price of sold units has decreased by 25%, the average DOM has increased by 12.4%, the total dollar volume sold has decreased by 43% and the average LP/SP ratio has remain statistically unchanged.

The number of units sold registered in the 1st quarter of 2009 has increased noticeably in the 2nd quarter (44 sold in the 1st qtr. And 76 sold in the 2nd).

Lots-City (Fredericksburg, TX) - The total number of lots sold in the 2nd quarter of 2009 declined 47% from the sales reported in the 2nd quarter of 2008 (17 in '08 vs. 9 in '09). The average price of a sold lot declined 7.82% ($62,682 in '08 vs. $55,778 in '09) and the average DOM has increased 92.94% (241 in '08 vs. 465 in '09). The total dollar volume of lots sold has decreased 51.2%. Notably, the average LP/SP ratio has decreased by 7.57%.




Year-to-date (vs. YTD, 2008), total units sold have decreased by 64.7%, the average price of sold units has decreased by 34.71%, the average DOM has increased by 48%, the total dollar volume sold has decreased to the current 91.5%.

The number of units sold registered in the 1st quarter of 2009 has increased noticeably in the 2nd quarter (3 sold in the 1st qtr. And 9 sold in the 2nd).

Rural Subdivision Lots/Tracts - The total number of acreage lots sold in the 2nd quarter of 2009 declined 39.1% (23 in '08 vs. 14 in '09). The average price of a sold acreage lot declined 35.3% ($129,405 in '08 vs. $83,761 in '09) and the average DOM increased by 50%. The total dollar volume of acreage lots sold decreased 60.60%. Notably, the average LP/SP ratio has decreased by 3.05%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 56.86%, the average price of sold units has decreased by 34.83%, the average DOM has increased by 29%, the total dollar volume sold has decreased by 71.89.

Acreage, Farm/Ranch (All MLS Counties) - The total number of properties categorized as Farm/Ranch sold in the 2nd quarter of 2009 declined 30.95% (42 in '08 vs. 29 in '09). Average prices and DOM tend to be less significant in this category as the properties offered and sold vary tremendously. Most notably, total sales volume has decreased by 45.6% from 2nd quarter 2008 vs. 2nd quarter 2009.

Year-to-date (vs. YTD, 2008) the total number of units sold has decreased by 65.9% and the total volume sold has decreased by 62.76%

Seller Financing

Offers of “seller financing” (a/k/a owner financing) have been popping up more and more in ads listing Fredericksburg, TX real estate for sale. What can this mean for a buyer or seller?

For a seller, it is a way to differentiate your offering to the buying public. While it can often be interpreted as a “hint” that you are “motivated” (not always a good card to play), in today’s challenging market, who cares! If you weren’t “motivated” your property wouldn’t be on the market in the first place.

Savvy seller’s have learned that an offer to finance a buyer’s purchase of your property can be a nice way to bank some cash (down payment), receive a pretty good return on your investment (the interest rate charged) and retain the possibility of regaining ownership of that property in the event a buyer defaults on the note. The keys, of course are the creditworthiness of the buyer and the negotiated down payment (generally 20% or more) and the interest rate (typically, slightly higher than published mortgage rates).

Of course, a creditworthy buyer will compare your terms to that they might receive from a financial institution. It is likely that (all things being equal) they will opt for bank financing. In the current lending environment, however, potential buyers with available cash and “decent” credit (i.e. not “sterling credit”) may not have the option of shopping around for financing.
The questions a seller must ask when considering this are: Do I need 100% of my cash now? What will I do with that cash if I get it all now? Do I have a mortgage to pay off? Will a buyer’s down-payment pay off my current mortgage? What kinds of competing returns can I receive on my funds?

The bottom line for seller’s is that the option to provide financing to a potential buyer sets you apart from the competition, expands your pool of potential buyers and allows you options on handling your sales proceeds.

A buyer considering negotiating for seller financing faces many questions. First and foremost is whether or not the financing offered is competitive with other, more traditional, lenders. Be sure to factor in fees, points and all the other miscellaneous fees lenders charge when comparing the bottom line. ( e.g. a seller typically won’t charge an “origination fee” so common to “traditional” lenders). The savings can be significant.

As noted, a buyer today with less than perfect credit often will not qualify for the low rates advertised (without paying substantial “buy-down” points, etc.) and seller financing may be a very legitimate (or only) option.

Flexibility and creativity are keys in selling (and buying) real estate in our current market. Fredericksburg, TX is no different. Be sure you work with an agent that is familiar with the ins and outs of all aspects of these important transactions.

1st Quarter 2009 Real Estate Sales

The information presented below is complied from data sourced via the Gillespie County Multiple Listing Service. The tracking historical sales data is grouped into categories that include: "Residential", "Rural Subdivision Lots/Tracts", Acreage, Farm/Ranch" and "City Lots". These categories are further defined by "area" (e.g. in town, out-of-town/county).



While it can be difficult to portrait a true "apples to apples" picture of current real estate sales, the numbers speak for themselves as categorized. A lot can be read "between the lines" when discussing these figures, if you would like more detailed information on these summary comparisons, feel free to contact me at your convenience.
1st Quarter-2009

• Residential-City (Fredericksburg, TX) - The total number of homes sold in the 1st quarter of 2009 declined 32.3% from sales reported in the 1st quarter of 2008 (31 in '08 and 21 in '09). The average price of a sold property declined 22.26% ($254,144 in '08 vs. $197,562 in '09) and the average number of days-on-market (DOM) has increased an average of 16% (174 in 1st qtr. 2008 vs. the current 202 days). The total dollar volume of homes sold declined 47.34%. Notably, the average list price to sale price ratio (LP/SP) has remained statistically unchanged.

• Residential-County (Gillespie) - The total number of homes (w/acreage) sold in the 1st quarter of 2009 declined 68.75% from the sales reported in the 1st quarter of 2008 (16 in '08 vs. 5 in '09). The average price of a sold property declined 28.15% ($301,031 in '08 vs. $216,300 in '09) and the average number of DOM has increased 25.3% (229 in '08 to 287 in '09). The total dollar volume of homes sold has declined 77.55%. Notably, the average LP/SP ratio has remained statistically unchanged (93% vs. 93%).

• Lots-City (Fredericksburg, TX) - The total number of lots sold in the 1st quarter of 2009 declined 82.35% from the sales reported in the 1st quarter of 2008 (17 in '08 vs. 3 in '09). The average price of a sold lot declined 69.22% ($91,679 in '08 vs. $28,217 in '09) and the average DOM has decreased 70.6% (255 in '08 vs. 75 in '09). The total dollar volume of lots sold has decreased 94.6%. Notably, the average LP/SP ratio has decreased by 4.3%.


Note: these figures can be slightly misleading as the volume sold so far in 2009 is statistically insignificant and not readily comparable to 2008 volume.

• Rural Subdivision Lots/Tracts - The total number of acreage lots sold in the 1st quarter of 2009 declined 71.4% (28 in '08 vs. 8 in '09). The average price of a sold acreage lot declined 26% ($171,702 in '08 vs. $126,925 in '09) and the average DOM was statistically unchanged. The total dollar volume of acreage lots sold declined 78.87%. Notably, the average LP/SP ratio has decreased by 3.37%.

• Acreage, Farm/Ranch (All MLS Counties) - The total number of properties categorized as Farm/Ranch sold in the 1st quarter of 2009 declined 58.82% (34 in '08 vs. 14 in '09). Average prices and DOM tend to be less significant in this category as the properties offered and sold vary tremendously. Most notably, total sales volume has decreased by 61.41% from 1st quarter 2008 vs. 1st quarter 2009.