It has finally happened. Inventory levels in Fairfax, Prince William, Loudoun, Arlington, Fauquier, Alexandria and all the cities in between have now dropped below 5,000 homes for sale. We have just 4,692 properties on the market. We have not been this low in nearly a year. This number is not an all time low – the first week of March in 2005 we had 1,652 houses for sale – this was the all time low for this region. If you are curious, the all time high was the third week of November 2006 when we had 22,898 houses for sale. So as you can see, we are approaching an extreme situation in housing – nothing for home shoppers to buy. A more balanced market would be in the 8,500 to 9,000 range – we are at about 50% of where we need to be.
So what does all of this mean? If you are a seller, now is the time to put your house on the market because there is very little competition. If you are a buyer, you will more than likely be in a multiple contract situation so be ready to put your best offer on the table initially. Also, buyers will turn to new construction as an alternative to their housing needs as they can’t find suitable solutions in the resale market. Lastly, prices should continue to increase – just need the appraisers to agree this is the situation.
What else is low and going lower? Interest rates. It is amazing that virtually every week the news is rates continue to hit new all time lows. This makes now a great time to buy or refinance.
So, what is your opinion? How soon will it be before we see an increase in inventory? When will we see rates increase? I’d love to hear your opinion so give me a call.