Nellysford
Nelson County, Virginia

Help Us Find Nelly May

Early Monday morning we found a rather suspicious note in a jar on the front porch of NCL Headquarters here in Nelson County. We are obviously very concerned for the safe return of Nelly May. She’s the famous cow you see each season at The Nelson Farmers Market Coop in Nellysford. Though smarter than the average bovine, we fear she may be out of her league. Here’s the ransom note left on our porch. We have published it verbatim: We have taken the cow you call “Nelly May” to protest the failure of recognizing bears in the area. Bears were in the valley long before cows ever were. Yet they are the ones getting all the attention at the market and in the news, and what are they even good for?

How many cow role models do you see in the U.S.? One. That darn Chick-Fil-A cow. And he can’t even spell. Now think of all the bears. There’s Smokey, Yogi, Winnie, Paddington, and even the Bernstein Bears. All teaching valuable life lessons.

We want equal rights and equal media attention. We are the high profile celebrities in these parts. Our infrequent appearances are much more exciting than any old cow.

Our stipulations are as follows:

We want bird feeders back – Why punish the birds with malnourishment? They never did anything to you.

No more locks on the dumpsters – You don’t see cow proof dumpsters anywhere, do you?

We want “Bear Crossing” signs posted – Everyone always thinks about the deer, but what about us? Don’t we deserve the right to cross the road safely?

Take down the “Do not feed the bear” signs – Why single us out like that? Do you think we don’t see what’s going on? Just because smell is our principle sense doesn’t mean we can’t see and read the signs you post about us.

Give us what we’re asking for and only then will you see your precious Nelly May again.
Signed,
The Bear Brigade

If you have any information that will help us save Nelly May from these unruly bears, please call (434) 361-0545 or email Tim Hess at Wintergreen Real Estate. We are offering a reward for information information leading to the return of our poor Nelly May.

This winter news letter brings a combination of good news and bad news. Let’s start with the bad news and you already know what it is….SKI SEASON. We are off to a poor start due to the warm weather and there is “no foolin’ Mother Nature” when one needs cold weather to make snow. The Crocus plants think spring is here. Hit 70° last week. Good days for winter golf but unfortunately most of the annual income generated for the resort is during the ski season and losing the normal ski crowds of Christmas week and perhaps even the upcoming Martin Luther King weekend upcoming will have an adverse financial impact. I am guessing that in addition to the 5 slopes currently open and the two cross trails that the Highlands Slope should be open this weekend for MLK and then it may turn and stay cold and we could have a decent recovery. It is still going to be a difficult year for W.P.I.

On a brighter side, the Tough Mudder event held this fall was a great success. The Wintergreen Police, WPOA , Tough Mudder organizers, and the WPI resort personnel did an outstanding job of managing crowds of about 35,000 over the weekend. I heard that there were 9000 participants on Saturday and about 7000 on Sunday and then associated friends and families to witness the event. Whether it comes back next year no one knows at this point. It generated about $250,000 for the resort in that one fall weekend.

In regard to real estate, we are seeing improvement.  Sales were stronger than anticipated this past year. However, there are still more sellers than buyers in our market. A mortgage broker colleague offered the following observation in an email yesterday, “The bad news out of Europe helped balance out the good Jobs news here at home…allowing Bonds and home loan rates to recover from their initial negative reaction to the Labor Department’s report. The Euro is continuing to be weighed down by rising concern on member countries’ ability to get their deficits in order and their debt in manageable position. The bottom line is that the problems in the Eurozone are vast, complicated, and without easy solutions, so it will take a very long time for clear resolution. And during times of global uncertainty, money will flow into the relative safe haven of the US Dollar and US Bonds – including Mortgage Bonds, which home loan rates are tied to. This means that home loan rates should continue in their sideways trend and remain near historic lows, making now a great time to purchase or refinance a home.”

One of my friends who has a spectacular home on the mountain also sent me the following email last week which I found interesting and shared with my office colleagues and want to share with you as well. Some of the videos embedded in the email are interesting, others are just a rehash of what you already know. While housing, like politics, is local; looking at national trends is important because there is a lot of money sitting on the sidelines waiting for the bottom and the perfect time to invest and the people who invest at Wintergreen follow the advice and information mentioned below…..

After several years, I think we are there.

Tim,

You may know that I worked for a private equity firm in NYC for five years, (before he became CIO for a Fortune 100 company).   It was long enough to learn not to bet against the “smart money” that run these firms.    They get the big turns right very often.  For example, they were running towards Treasuries and away from housing in late 2007, well before the market turned nasty.   In any event, it appears the hedge funds and private equity folks are now investing in housing, convinced that a bottom has been reached and there is money to be made.    I know all real estate is local, especially vacation property, but it would be helpful to have some macro trends in our favor for a change.   Anyway, in case you had not seen it, here is the article I read today:

Big Funds Build Case for Housing

By GREGORY ZUCKERMAN

Big money is starting to wager on housing.

Hedge funds run by Caxton Associates LP, SAC Capital Advisors LP, Avenue Capital and Blackstone Group LP have been buying housing-related investments, betting on a rebound. And formerly bearish research firm Zelman & Associates now predicts a housing pickup, as does Goldman Sachs Group Inc.

Other investors seem to be making the same bet. Shares of home builders are up 30% since the end of the third quarter, as measured by the Dow Jones index tracking those shares, topping a nearly 10.5% gain for the Standard & Poor’s 500.

Reuters

A worker lays shingles as construction continues on a residential home in Carlsbad, Calif., Sept. 19. 2011.

These stocks rallied during certain periods over the past three years, only to fall again when hopes of a housing rebound proved unfounded. However, home builders haven’t outperformed the broader market by this much in a quarter since the third quarter of 2008.

“We turned bullish on housing. A rebound is coming,” says Andrew Law, chief investment officer at $10 billion hedge-fund firm Caxton. He expects that home prices and construction will rise in 2012.

Related Video

• Markets Leap, Carried by Housing Sector (12/20/2011)
• Housing Numbers Starting to Perk Up (12/20/2011)
• Housing Starts Blow Through Expectations (12/20/2011)
• WSJ Survey: Housing Sector Down Through 2016 (12/08/2011)
• Why Getting a Mortgage Is So Tough Right Now (11/29/2011)

Bulls received ammunition last week when the National Association of Realtors said sales of previously occupied homes in the U.S. rose 4% in November from October, topping expectations. The inventory of previously owned homes listed for sale fell 5.8% to 2.58 million, the lowest level since May 2005. That came on the heels of data that residential construction surged in November.

“The housing-price bottom is probably in sight,” Goldman said in a December 15 report. Housing prices might decline by 3% next year before beginning a rise, Goldman says. The bank predicts gains of 30% over the following 10 years, not taking inflation into account.

It is too early to declare an end to the housing difficulties that began five years ago and led to trillions of dollars of losses and a global economic downturn. U.S. home prices fell 3.4% this year as of October, according to the Standard & Poor’s Case-Shiller home-price indexes released Tuesday. Inventories could rise next year if banks move more properties through the foreclosure process.

Some investors and market observers aren’t convinced of an imminent turnaround. Still, investors try to anticipate economic trends before they materialize. Even some housing skeptics acknowledge that real estate may no longer be the drag it has been on the economy.

“I’m sold that it’s a bottom,” says James Bianco, who runs Bianco Research, in Chicago. “It’s gone from a negative to a nothing for the economy,” though it may be hard for the U.S. to grow at an impressive clip until housing ramps up, he says.

Related Reading

• MarketBeat: Early Signs of a Turnaround
• MarketBeat: Housing Showing Signs Of Stabilization; Home Builders Benefit
• Pending-Home Sales Hit 19-Month High
• Mortgage Rates End Year Under 4%

The bullish stance appears to be a growing view among big-money types. Caxton turned bearish on housing in 2007, but the firm became optimistic over the past three months based on the low number of new homes built in the past few years as household formation rebounded.

Caxton has scored recent profits buying shares of home-related companies, such as home builders. “My sense is companies see a turn and are positioning themselves for a multiyear rebound,” Mr. Law says.

SAC Capital, the $14 billion firm run by Steven Cohen, also has been buying housing shares, anticipating a gradual real-estate recovery, according to a person familiar with the situation.

A $3.5 billion hedge fund run by Blackstone’s GSO Capital, which profited betting against housing as the market tumbled in 2008, began buying stakes in Beazer Homes USA Inc. andPulteGroup Inc. in November, as well as certain housing debt, according to people familiar with the situation. The shift partly resulted from an improving outlook for profits of home builders.

Though GSO hasn’t risked a large chunk of its portfolio on housing, it expects a real-estate rebound to bring significant gains.

“We believe housing is at a turning point, not just because of affordability and improving demographics,” says Darren Richman, a senior managing director at GSO. “The inventory picture has cleared meaningfully. It’s more in balance than it’s been in a long time.”

Earlier this year, Marc Lasry, who runs Avenue, a $12 billion firm that specializes in distressed debt, started buying bonds of home builders, including Hovnanian Enterprises Inc., “as a housing play,” Mr. Lasry says. He was enticed by their low prices. “We were six months too early,” says Mr. Lasry. “But we think housing keeps improving over the next year.”

Behind the investor optimism: Pent-up housing demand, say industry observers. Many younger adults and others have moved in with parents or into apartments. But record-low mortgage rates and improving home affordability could spur them to buy homes over the next year or two. Housing starts have been well under 500,000 a year since the downturn, compared with over 1 million before that.

“Given income and population growth, the longer-term outlook is more optimistic,” Goldman said in its recent report, while noting still-high delinquency rates. “Affordability is at record highs, at least for those who can get financing.”

Ivy Zelman, a longtime real-estate analyst who was bearish about housing before the downturn, has been offering clients a different view lately, predicting that rising rents will push would-be buyers to purchase homes. A housing recovery isn’t “happening as fast as everyone would like,” she says. But there are “a lot of pillars in place to give us some optimism.”

Bulls have been burned over the past few years predicting a rebound, and any improvement would be from a very low base. Housing data is seasonally adjusted and tends to be quite volatile. And much of November’s increase in construction came from apartments, town houses and multifamily developments, a sign of demand for rentals, not home buying.

“The smartest money in the world has been carried out on stretchers betting on a true recovery for housing,” says Mark Hanson, who runs M. Hanson Advisors, a research firm catering to hedge funds that argues a sustained rebound is several years away.

Mr. Hanson says too few homeowners have enough equity to enable them to sell homes and buy new ones, something that usually drives housing. He also predicts more foreclosures, short sales and defaults, especially among homeowners who recently modified loans. Mr. Hanson argues that household formation won’t grow much unless unemployment keeps dropping, and that mid-to-high-end homes will fall in price next year.

That’s why some investors, such as Whitney Tilson’s hedge fund T2 Partners LLC, remain bears. Skeptics say many people are becoming more comfortable renting, crimping any housing turnaround.

New York Federal Reserve President William Dudley recently said that while home prices “no longer appear overvalued,” it is “unwise to simply assume the market will bottom out at these levels” because expectations of house-declines “can easily be self-fulfilling.” He also noted that access to mortgage credit is constrained.

Still, some investors are betting the bears are too pessimistic.

James Litinsky, who runs JHL Capital Group, a $1.5 billion Chicago-based hedge fund, turned optimistic in the spring when he crunched numbers on household formation and population growth compared with the availability of new and existing homes. He began buying shares of housing-related companies, including Louisiana-Pacific Corp., which makes wood products for homes, as well as home-improvement retailers The Home Depot Inc. and Lowe’s Cos., and home builder Lennar Corp.

Mr. Litinsky ramped up his buying in the past few months, becoming the largest holder of Louisiana-Pacific according to securities filings. About 25% of his portfolio is in housing-related stocks, up from virtually no such shares at the beginning of the year, he says.

“We’ve already worked off a chunk of the excess supply and eventually there will be shortages,” says Mr. Litinsky, who adds “it’s been lonely thesis until a couple of weeks ago.”

—Nick Timiraos contributed to this article.

Picture of the week for December 24, 2011

If you love Wintergreen as much as we do, you may want to check out the new picture of the week feature on our home page. Each week, we will publish a season-relevant full-page picture taken in or around Wintergreen. If you click on the picture. you will see a high-resolution PDF of the picture, suitable for printing. Take a look. Let us know how you like this new feature.

If you want a previously published picture, send us an email and we will be happy to send it to you.

Webmaster
Wintergreen Real Estate Co.

We already have text message capability for special events and property listings. Click here to see the text message article. QR codes offer smart phone users yet another convenience.

Quick Response Code for Events Calendar

If so, check out our Offer #49. Present your copy of the Tough Mudder flyer and get 15% off any rental through October 1, 2012, except ski season weekends 12/23-2/26 and holidays and special event weekends.

Good luck on the course this weekend and come back to see us. Click here to see our rental program. Call us at (434) 325-7933 when you’re ready to rent.

Tough Mudders Get 15% Rental Discount

Fall is upon us. Chilly evenings and cool bright clear days! Best time of the year! The leaves are just starting to begin to turn from the top down. The next six weeks will be the most spectacular and beautiful of the year and very active with events. Come visit and bring your friends and family. Since my summer newsletter, we have completed the “Pooch Park” on the old Summit House site above the mountain office. We have put in a Bocce court, Shuffle Board, Corn Hole Game Boards, picnic tables, umbrellas, decks, rock gardens, a propane grill and a gazebo. Our colleague, Dick Carroll and his contractors, did a wonderful job. I encourage you to bring your kids, dogs, and friends, to enjoy this beautiful new park. It has stunning views and has been host to picnics with bands and artists and even our first wedding. Kim Smith’s son got married last month in the thick clouds. It was unique and beautiful. WREC has received compliments on the addition of the new park such as the following. “WREC is an outstanding corporate leader for the effort on the Pooch Park. You don’t see that very often.” The first wedding at our mountain event site.

Even our young bear neighbors have visited. Pictures courtesy of Joan Mummery, Dima Holmes and Kim Smith

Many great activities are planned on the mountain in the coming weeks: Next weekend is September 24, 2011 Oktoberfest (if you love great imported and local brewed beer) Fall Foliage Festivals and Golf Championships fill out many of the other fall activities.

One of the big exciting events in the near future is the Tough Mudder. It will be one of the biggest attractions ever to occur at Wintergreen. It will be held on Oct. 21 and 22, 2011. Imagine the biggest ski weekend you have experienced, then double the number of people. Thousands of people will be on the mountain for this race from all over the world. But, they will be bused from parking areas in the valley. You will understand the attraction when you see the web site. There is a good map of the course on the web. Check out the web site, well worth it.

Tough Mudder Virginia – The Toughest Event on the Planet: www.toughmudder.com/virginia

Now to what is happening in real estate world:  the best place to start this fall is with the Fed: If one interprets the latest Fed’s statements regarding economic conditions, they mentioned the markets “warrant exceptionally low levels for the fed funds rate at least through mid-2013.” Thankfully, the low fund funds rates will likely help keep mortgage rates low. We may even see rates drop lower. Right now 30 year fixed rate money with zero points is about 4% and we may even see it drop to 3.5%. Regardless, these are now the lowest rates we have seen in this country in 60 years. It has helped sales, no doubt, but it has also done little to generate the expected urgency to purchase in either the primary or secondary markets because consumers interpret this as meaning the weak economic conditions could lead to even lower home and condo prices. There are properties at Wintergreen that are overpriced, given the slow market, but there are also houses, condos and lots priced correctly and they are good bargains. The well-priced properties are selling. Due to the low interest rates, it is one of the best times to buy or refinance a property in our history and the perfect time to recommend to friends to purchase at Wintergreen or in Stoney Creek or the surrounding areas of Charlottesville and the Shenandoah Valley. Your referral will be a big favor to them and of course, to me.

Sales in general seem to be getting better, we have 57 sales and listings closed for over $20,000,000 YTD and a good number of transactions pending, so I am encouraged that properties are selling going in to the fall and early ski season. There are about the same number of houses and condos on the market as there were in my last newsletter. As of this date, about 105 condos and townhomes and 88 homes are for sale on the mountain, 45 homes and townhouses in Stoney Creek and about 55 lots on the mountain with 68 in Stoney Creek. All in all, it is not a bad ratio of re-sale properties to standing inventory.

Regardless of the low interest rates, there is also concern that inflation is just around the corner as I have mentioned in the past. Interest rates have to go up. Last week there was an early indicator. The Producer Price Index (which measures inflation at the wholesale level) remained unchanged in August, but the year-over-year Core Consumer Price Index (CPI) jumped up to hit the upper-end of the Fed’s threshold of 2%. This is significant because ifinflation rises, investors in Bonds will demand a higher yield to offset the lost buying power inflation imposes on a fixed payment. And as home loan interest rates are tied to Mortgage Bonds, this would mean home loan rates will move higher.Once inflation starts to emerge, it can manifest rather quickly so it bears watching. Future inflation readings such as the CPI (about 3.8%), unemployment (9% plus) will be closely watched to see if a higher trend is emerging, and as more money flows into the system it will also fuel inflation. If inflation heats up, the Fed will likely back off their “low rates until mid-2013″ mandate. Inflation really does change everything. The bottom line is that home loan rates remain near historic lows, now is the time to purchase or refinance a home. If I can answer any questions at all for you or your clients, call or email me anytime.

The other obstacles I see in our market, in addition to the general market uncertainty, is overpricing.  Overpricing a home can have many ramifications for a seller.  It limits the number of potential buyers who can afford the home, it reduces showings and it creates an impression in the marketplace that the sellers aren’t really serious about selling their home.  Folks who overprice their home often get caught in the trap of price reduction after price reduction trying to catch a falling market. Many sellers have the mistaken idea that they can hold out for an inflated price and eventually the market will come to them. When selling a place its value is determined by one thing and one thing only – what a qualified buyer is willing to pay for it. The secret to pricing a home to sellis not what you think the home is worth, but what a reasonable buyer will think your home is worth. It will ultimately determine if the home or condo will sell.  Every buyer knows that the seller has no obligation to sell their home at any price and to purchase the home the buyer will have to make them an offer they won’t refuse. Buyers are under no obligation to buy, and no amount of marketing, open houses, website presences, or advertising will motivate a buyer to purchase an overpriced home, because they can buy one of other homes or condos for sale for less. One of the most important considerations in pricing a home at Wintergreen or anywhere else is doing an accurate Comparative Market Analysis. It is a report that compares a “subject home” with other homes in a specific area. This analysis is then used to provide an anticipated sales price or price range for the subject property. The report provides home buyers and home sellers with a clear understanding of the market data that affects their opinion of value. We do these CMA’s because the information it provides is crucial to getting a property sold in a reasonable amount of time. Many homeowners attempt to put the responsibility of getting both top dollar and fast sale on the back of the real estate agent and the result can be summed up in one word – frustration. Real estate agents don’t do miracles. A real estate agent’s job is to provide marketing, expert advice, and negotiating services, and they don’t make the final decisions on pricing. The seller does, and ultimately the seller’s asking price will in large part determine how slowly or quickly the home will sell. The agent only advises the owner where the house or condo should be priced given the market. Successful sellers take ownership of their pricing decisions by making a clear decision about which is more important to them, selling quickly or selling for top dollar. Successful sellers have learned that to price their home accurately means they need to think like a buyer. Most buyers would probably start online by viewing listings at websites like www.wintergreenrealestate.com or www.caar.com (local MLS) www.realtor.com www.tulia.com www.yahoo.com/realestate or www.zillow.com to get a general feel for local home prices. Feeling good about their findings, they call us and might then venture out to begin viewing homes in person. The internet has greatly informed buyers and they become so knowledgeable about the market that toward the end they are able to guess, with reasonable accuracy, each homes listing price before we tell them.

A final note: A young friend from Nelson County, and a  very recent graduate of The University of Virginia, Jonathan Goff, wants to start his own business by offering a unique new service for owners .This newsletter is my small way of  helping him.  Jonathan is a great kid, dependable, and wants to create his own opportunities.   “Le Concierge” Jonathan Goff 434-962-4644 and his email:  leconcierge151@gmail.com and address … 454 Shiloh Loop, Faber, Va. 22938. Some of the services provided: grocery and dry cleaning delivery….house-sitting and pet-sitting….property management….garbage and wine/ beer, etc. pick-up….misc. residential services, in short, whatever you want him to do.. Good kid, and will treat your home like his Momma’s.

Contributed by Tim Merrick

Wintergreen Real Estate was recently the site of a beautiful wedding. The new park (High country park) was the perfect setting for a wedding. The families and wedding party enjoyed beautiful views from the properties rented through WREC. Here are some photos provided by Kens View Photography!

Celebrate the last of the DOG Days of Summer at the Grand Opening of our off-leash “Pooch Park”. You are invited to bring ALL the members of your family, furry or otherwise, to the opening of our brand-new dog park.

While we will eventually develop the space behind the Black Bear cafe, we decided to make it available to the community until development. You may have already enjoyed the site on Memorial Day or the Fourth of July. Since then, we have dramatically improved the space, recently completing this spectacular site. We just finished a picnic deck and games area and are proud to announce our fenced-in “Pooch Park”.  You can visit the site for picnics, to enjoy music, or to play games, while your pet pals run free and romp with their fellow K-9’s.  Two separate enclosures ensure that both large and small dogs each have a safe place to stretch their legs. Bring the entire family and spend a few hours celebrating with us!

Can't Find A Dog Walker? Visit our new Wintergreen Real Estate Pooch Park

While Fido is busy meeting new playmates, you can enjoy:

• Music

• Free hot DOGS, chips and drinks

• Free SNOW-CONES! (Don’t eat the “yellow” snow–just kidding.)

• Games and give-a-ways for the kids

• Bocce Ball, Corn-Hole and Shuffle Board courts for the competitive at heart

• A Donation Area for Nelson County SPCA **

• Doggie Adoptions … AND MORE!!!

** WREC supports the SPCA of Nelson County “Almost Home” No-Kill Pet Adoption Center. Come to the donation tent and donate any gently-used, clean items: clothing, shoes, household items, books, small appliances, movies, music, pet supplies, toys, etc. Donated items go to the SPCA Thrift Shop to help raise money to support the shelter. Please also donate items needed every day at the shelter: bleach, paper towels, trash bags, laundry detergent, dish detergent, canned dog and cat food, kitten and puppy chow, feline pine cat litter, Frontline for dogs and cats and dog biscuits.

Please help in any way you can.  Click here to learn more about “Almost Home”.

Event Site Pictures (courtesy of Gina Carroll)

Pooch Park Enclosures

Game Area: Shuffle Board, Bocce Ball, and Corn Hole

Picnic Area with Shaded Tables