This tag line is very appropriate for many different reasons. First, let’s start with the Northrop Grumman’s move to Northern Virginia from California. Northrop Grumman had been looking to relocate their company to this region because they have over 20,000 employees in Virginia, Maryland and DC and was looking for a different presence here in the area. There will be approximately 300 high level executives moving to the area and there is no doubt, additional subcontractors and service providers of Northrop Grumman will move here as well. Kudos to the leadership of Virginia in capturing such a valuable resource!
Additionally, in an economic report by George Mason’s Center for Regional Analysis, the Washington area’s economy will double over the next 20 years bringing in more than 1,000,000 new jobs and perhaps upwards as many as 1.6 million to our region. The jobs that will be created will be government – especially defense, domestic security, and financial regulatory agencies. Along with these new jobs, a total number of new people in excess of 1.7 million will be moving to the area. This is a good news, bad news scenario – good that the area will continue to grow and it should have a positive outlook on the housing market but a bad news scenario for roads, infrastructure and how to accommodate this growth. The area planners have some work to do!
Next, let’s review New Home Sales. Month over month sales of new homes jumped 26.9% in March – the largest increase in nearly 50 years! New Home Sales had been in a four month slump coupled with a record low of housing starts in February; this segment of our market got a strong shot in the arm with this excellent news! Let’s see how these numbers are affected by the home buyer tax credit ending this week and see if sustainable growth will occur.
Now on to existing sales…existing home sales rose as well. The number increased by 6.8% in March – this is the ninth straight month of increase in sales over previous year ago levels each month. This is a result of favorable market conditions – great rates, lower prices, and the homebuyer tax credit amongst other things. Let’s keep this pace headed in a positive direction!
We must also speak about inventory levels. They too have been increasing every week since the last week of December. It is important to keep an eye on this number and how it affects pricing on a number of fronts. In the Northern Virginia region – the inventory of existing homes for sale in week ending April 23 was 7,252…stay tuned.
And the last piece of good news – and it isn’t about an increase – it is about relative stabilization in mortgage interest rates. Many expected rates to shoot up at the end of the government’s purchasing of mortgage backed securities but it hasn’t really happened. Interest rates were just below 5% in March and have stayed in the 5.125 – 5.25% range over the last 3 to 4 weeks. Let’s hope private investors continue to buy mortgage backed securities and the government keeps the funds rate low as well.
It is important for professional Realtors to keep up-to-date with the market and market conditions to keep their buyers and sellers completely informed on what is happening so they can make the right decisions when buying and selling homes – get in the game of learning more! Get it? Got it? Good!
One thought on “Here we grow again…”
Inventories have continued to climb, BUT contracts have also continued to climb resulting in an actual decline in the months supply of inventory. This means that all of the new inventory is not enough to keep pace with the increase in properties going under contract. Good news all the way around. Thanks Scott! I know how much time it takes to put this kind of information together and it is always nice to get different perspectives.