April 2020 Market Update

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First and foremost, I hope you are being safe and making good decisions when going out in public so you can remain healthy. Please let me know if I can do anything at all for you during the COVID-19 situation we are in today.

I never imagined that I would be writing a blog commentary like this one. It is insane. Quite frankly, I can’t remember a time when I have said crazy or insane so often but what other words can be used to describe what is going on around the world. Things are happening so rapidly with changes day to day, hour to hour and even minute to minute. The government has stepped in with the $2.2 trillion stimulus package to assist monetarily but is it enough? Only time will tell.

I am still asked the popular question, “what is happening in the real estate market” several times a day.  Well, that too changes daily. We have been asked to shift our normal process to include doing virtual showings and virtual open houses, to stop searching for buyers, take listings off the market as well as the complete opposite. Some people need to sell so they are keeping their houses on the market and some buyers need to buy because they recently sold their house or their lease is ending, or a job has relocated them here. Some agents are not showing properties or taking listings and others are as active as ever. My response to all of this is simple, if you are not comfortable selling your house, looking at houses or working in this environment, then please don’t.  We would never want you to be uncomfortable or do something that may put your health at risk.

If you are comfortable with the process, please take the appropriate precautions. As such, in an effort to protect our clients and the public as a whole, we are implementing new protocols when any agent, whether from our company or others, shows our listings or if we show houses to our clients. If you are interested in learning more about these protocols, please feel free to call me, I would be happy to share them with you.

Again, please be safe so you can remain healthy and know I am here to help you in any way I can. I hope you have a very Happy Easter with loved ones, it will be one we never forget.

March 2020 Market Update

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It’s March Already!

It seems like just yesterday that we started the new decade. You know the saying; time goes by faster when you are busy and boy have we been busy!

The real estate market continues to be very brisk. For example, I have scheduled appointments on a Thursday afternoon to show properties for the coming weekend. Several of the homes went under contract so quick resulting in canceled appointments (and sad clients). These houses were in various areas and various price points throughout Northern Virginia, not isolated in one area. In conversations with sellers, I have been letting them know that even though there are bidding wars, multiple contract situations, etc. the price and condition of the house still rule. If prices are too high for the area/neighborhood or if the home needs some work, it will sit on the market with little to no activity and definitely without offers! When priced well and in “HGTV condition”, there is a feeding frenzy. Buyers in today’s market, realistic or not, are looking for the perfect house and they are willing to pay for it. So, as a seller, get your house in top condition and price it right to get it sold and not be just “for sale”.

Lately, the news and social media have been inundated with information on the Coronavirus. The stock market has dropped over 4,000 points and this question is now coming up in conversation more often; “should I be concerned as a buyer or seller?” At this time, there are concerns but as I previously mentioned, we are still in a great area with sales at a feverish pace. My concern would be more for buyers and sellers in the luxury market. As part of their wealth may be invested in the stock market and as a result, there could be a concern but as we know, the market continuously ebbs and flows and this one is no different. There will be a cure for this killer virus, the stock market will rebound, and houses will continue to be bought and sold. Have no fear! If you would like to discuss this in more detail, feel free to call me.

As always, I am here to help you and your family and friends with their real estate needs. Happy Spring!

 

February 2020 Market Update

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Unusual February Weather

The weather in February is heating up just like the Northern Virginia real estate market.  The Spring Market is in full swing and should continue because Punxsutawney Phil didn’t see his shadow and therefore, I think this market will continue to stay on fire.

All jokes aside, we are still experiencing unusually low inventory levels, tons of buyers in the marketplace and in many cases, multiple offers on properties. This situation leads to frustration on many levels as some buyers are missing out several times on homes.  The reasons vary, but many are because of their loan qualification levels, shortage of homes for sale in their price point (so there is increased competition), their cash availability and in some instances, not wanting to waive contingencies. Sellers get frustrated because they hear of these types of situations and they are not receiving multiple contracts, or they don’t believe prices have escalated high enough. The other possibility is that they are not receiving contracts at all. Unfortunately, these circumstances happen often as sellers may not have been educated by their agents as to what to expect of the market in their price point and location – many times they do not lend themselves to be in these situations. Other times, they have started their price too high and discerning buyers realize the escalated price is already “built-in” to the sellers original sales price.

Additionally, many houses are already overpriced, and buyers are not willing to even make an offer. As I always say and today it is still evident, you need to be in the right condition and priced right to sell. A high price is always a deal killer. If you are thinking about selling, I can walk you through the market you can expect to be in now and potentially in the future.

Lastly, agents can be frustrated – like me – because other agents don’t educate their clients about the market. Inventory is 30% below where it was this time last year. There are only 1,881 total houses for sale in all Northern Virginia. Lower price points have the highest number of buyers and therefore the highest potential of multiple offers. Agents are showing clients houses priced at $450,000 when the buyer only qualifies for $425,000 and needs closing cost assistance. Guess what?  It’s not going to happen in today’s market. Same for a buyer who has a top end of $450,000. Don’t waste their time it’s not going to happen. Lately, the lower price point properties have been receiving upwards of 25 contracts and are escalating thousands to tens of thousands above list price. Buyers need a knowledgeable agent to educate and set proper expectations when buying in today’s competitive market. You can win, but you need the right agent. Call me if you or anyone you know is looking to buy or sell a home.

I hope you are all taking advantage of these great February temps! Get out there and have fun!

January 2020 Market Update

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Happy New Year!

As we enter the New Year and New Decade of the 2020’s we are experiencing the lowest levels of available homes for sale in years. We currently have just 1,946 homes for sale in all of Northern Virginia. We have a serious need for more houses to come on the market! As of the end of December, we were experiencing multiple contract situations on many houses throughout our area – as many as 23 offers on one house. The demand is there, the housing supply is not. Sales last year outpaced sales from 2018 by nearly 1.5% through November and should outpace sales through December as well. Interest rates remain very low making it more attractive to buy versus rent in many cases. Those who previously suffered credit damage from the housing crisis during the great recession in the mid-2000s are now recovered and property values are increasing making now a more desirable to time own. Therefore, we now have a lot of pent up demand for housing at all price points.

Additionally, there is also a shortage of rentals available on the market, so when they do become available, they rent quickly. There is currently just a half month’s supply of rental houses in Northern Virginia. These factors definitely make it an ideal time to sell or rent your home. Call me to learn more about how you can position yourself for success in this market when making this decision.

Overall the economy is strong in Northern Virginia. Unemployment is very low in our area and with Amazon ahead on their hiring, I don’t see a change in this for us. The only issues we are really facing are the trade talks with China and Trump says the phase one agreement will be signed mid-January and the Iranian situation. Will this escalate to yet another war? If either of these issues goes awry, we could have economic problems that could affect the market as we know, only time will tell.

The good news is we continue to have a robust real estate market and I am available to help you when you are looking to make a move.  Make the 20’s your best ever!

December 2019 Market Update

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Wow, did November fly by or what?  It seems like I just sent my November newsletter and here we are in December already – crazy to me for sure. November brought a few substantial changes in our industry. First is the way we must now market our listings. The ability to pre-market homes as we know it has gone by the wayside. Previously, we could use signs, online marketing on social media sites, real estate websites, networking events and/or email campaigns to get the word out about future listings either days, weeks or months in advance. Now, we must put the home in MLS within one business day as active or in “Coming Soon” status once the property is marketed to the public in the aforementioned ways. It is more consumer-friendly as it opens up all houses to the buyers and it also gives sellers maximum exposure to all buyers by sharing the properties with all agents. Before this new rule, there were agents who would privately market homes to the detriment of the seller and potential buyers. This change will also provide accurate data in MLS for sales information, so we all know what sales prices and concessions are and inform us if the sale was an arm’s length transactions or not.  This is helpful for pricing houses for both buyers and sellers as well as appraisers. To learn how this can affect you when deciding to sell your house, give me a call, I’m happy to share more details.

The second area is financing houses and loan amounts. Here is a brief history of what FHFA has done since 2016 with conventional loans: back in 2016, the FHFA increased the conforming loan limits from $417,000 to $424,100. Then, the next year, the FHFA raised the loan limits from $424,100 to $453,100 for 2018. And in 2018, the FHFA increased the loan limit from $453,100 to $484,350 for 2019. Lastly, just last week, the new loan limits will be $510,000 for 2020. Jumbo loans will now go up to $765,600 in our area. Jumbo loans typically have higher interest rates. Please call to learn more about how this can help you when buying or selling a house.

Also, VA loans no longer have a limit, but they do have liability issues which can affect the amount of your loan going forward. If you are a veteran, your eligibility will drive your maximum loan amount. In addition, the funding fee for zero-down loans will be 2.3% of the loan amount in 2020, up from 2.15% for regular military in 2019. The fee for subsequent use loans will be 3.6% of the loan amount, up from the current 3.3%. You can pay the fee upfront or roll the cost into the loan. These go into effect for any loan that closes after January 1, 2020. Again, if you have any questions at all, please call me.

I hope you have a safe, fun and festive holiday season with all of your family and friends!

November 2019 Market Update

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Happy Fall!

The change in the weather has not changed the real estate market here in Northern Virginia. We still have a limited supply of houses for sale with lots of demand. Houses are selling quickly when priced right, are in the right condition and in a desirable location.  In all of Northern Virginia (Arlington, Fairfax, Loudoun, Prince William, and Fauquier Counties plus all of the cities in between – Alexandria, Fairfax, Falls Church, Manassas, etc.) the median days on market are just 14. As you can see, properties are selling quickly! The important thing to note however is prices are not drastically increasing with this supply and demand issue and when prices do get “pushed” we are having appraisal issues. It is important to price your house properly so if you are considering selling, please call me to discuss the right pricing strategy for you as each market is different.

During this time of year, people always ask, is now a good time to sell? My answer is – yes – if you need to sell. If there is a situation in your life that dictates the need to sell, list your house now. As I mentioned, we have a strong demand for houses. There is only a 1.5 month’s supply of housing right now. Also, we know that inventory levels are very low, only 3,855 resale houses are for sale today, so we know what the competition is for you. Who knows who will be selling in the spring and how this will affect pricing? We also know that rates, although they increased slightly this week, they are still great.  At this time, a buyer can get a 30-year fixed-rate at under 4% which is phenomenal.

Additionally, houses that are decorated for the holiday season often show better and, in some cases, give the buyer ideas on how they can enjoy the holidays in the house as well. A nice staging technique that can go a long way.  So, again, if you are thinking about selling and want to know if you should wait or list today, please call me.

I hope you have a festive Thanksgiving with your family and friends!

October 2019 Mid Month Market Update

Here’s your latest real estate market update for Northern Virginia. Inventory is low, it’s a seller’s market! And with interest rates still at an all-time low, not is a great time to buy!

What do you think? How is the market in your area?

Thinking of buying or selling? I’m happy to provide you with a free market analysis if your home. Give me a call to talk about your specific situation and needs. Call me at 703-652-5777 or email at scottmacdonald@remax.net

October 2019 Market Update

It is hard to believe we are entering the 4th Quarter of 2019 already.

It will be interesting to see what the vision of the real estate market will be in 2020. Right now, the real estate market is very dynamic and very hyperlocal. We see inventory levels remaining low relative to previous years. We currently have a total of 4,122 houses for sale in Northern Virginia – 33% fewer homes for sale through September this year versus last year. Homes priced below $350,000 represent only 719 houses with only 45 of these are located in Arlington. The Amazon Effect in full force in Arlington. Homes priced between $350,000 and $700,000 make up 1,822 homes of the total inventory numbers, only 46 of these are located in Arlington. Lastly, houses priced above $700,000 make up 1,582 of the houses for sale in the marketplace and there are only 118 in this price range located in Arlington.

As you can see, the market is different in each location, I just picked Arlington as an example.  That does not tell the whole story – prices are up year over year in all of Northern Virginia by 3.6% while in Arlington, they are up 12.4%. Additionally, the median days on market in all of Northern Virginia is 15 days on the market and in Arlington…you guessed it, lower at only 8 days on the market. The market is definitely hot for sellers “if” you price it right and do the right upgrades. Buyers will pay for ready to go houses and will pass on the ones that need work or updating.

This being said, housing prices are up year over year throughout our area – just not substantially. The 3.8% is healthy and sustainable. The issue we are having is sellers are trying to attain 5% per month and therefore the houses are not selling. In today’s market, buyers are being very discerning on prices and are not making offers including low offers. Sellers who overprice their houses or price in “negotiating room” find themselves sitting.

If you are looking to buy or sell in today’s dynamic market, call me today to set up a no-obligation consultation to learn more.

Enjoy the cooler temperatures heading our way! Happy Halloween!

September Market Update

My whole career I have been asked, “So, how’s the market?” Well, this year and more specifically, in the last few months, I have been asked this even more. It is a loaded question because it depends on whether you are a buyer, a seller, or if you are looking to rent and most importantly where you are looking to do any of these types of transactions.  After we clarify what they want to know, I find it is a lot of curiosity because people love to talk about real estate. It also is of interest to them because in our discussions I hear things like, “I don’t see any for sale signs in my neighborhood”, “when houses go up for sale in my area, they sell right away”, “my friend is looking for a house and they are losing out on multiple contracts” and many other similar comments so there is a genuine interest in “How’s the market”.

Overall, in Northern Virginia, the inventory on active resale homes is down over 31% from last year and units sold are virtually the same which means it is extremely competitive to be a buyer and if you price your house correctly, you can be a very happy seller. As always it is a hyper-local market so let’s take a deeper dive into the counties.

  • Arlington County – the Amazon Effect is keeping inventory low, median days on the market extremely low but interestingly enough, prices are not as high as you would think considering the supply and demand in that area. Closed sales are down as inventory is down and prices are up just 4%. Houses sell quickly – median days on market are just 9!
Statistic Jul YoY MoM
Total Sold Dollar Volume 182,179,254 down5.9% down7.5%
Closed Sales 266 down9.5% -0.4%
Median Sold Price $616,000 up1.3% +9%
Average Sold Price $684,884 up4% -7.2%
Median Days on Market 9 days down75.7% 0%
Average Days on Market 30 days down40% -16.7%
  • Fairfax County – Prices are up Year over Year but down Month over Month which indicates sellers are starting off too high and then making adjustments to get them sold. Days on market for Median Days and average days indicate a strong market but remember, price is critical to getting houses sold today. Closed sales are up Year over Year but are down Month over Month.
Statistic Jul YoY MoM
Total Sold Dollar Volume 1,027,443,963 up7.9% down5.9%
Closed Sales 1,680 up6.5% -4.8%
Median Sold Price $539,900 up2.3% -4.4%
Average Sold Price $612,668 up1.5% -1.1%
Median Days on Market 17 days down56.4% +6.3%
Average Days on Market 33 days down31.3% +6.5%
  • Loudoun County – the market in Loudoun is slowing a little as they are experiencing what other regions are – Year over Year gains but Month over Month declines. Median Days on Market jumped MoM but prices are maintaining in the area.  There is lots of pent up demand in Loudoun – stay tuned on their progress.
Statistic Jul YoY MoM
Total Sold Dollar Volume 408,811,460 up8.4% down2.8%
Closed Sales 747 up1.8% -1.2%
Median Sold Price $512,250 up8.5% -0.5%
Average Sold Price $549,478 up6.9% -1.4%
Median Days on Market 23 days down39.5% +43.8%
Average Days on Market 38 days down34.5% +22.6%
  • Prince William County – consistent with the other counties showing price reductions but an overall strong market as sales are strong and Days on Market are low. Prince William offers the lowest prices so more value!
Statistic Jul YoY MoM
Total Sold Dollar Volume 318,271,988 up5.4% down1.5%
Closed Sales 778 down0.4% 0%
Median Sold Price $385,000 up6.9% -2.5%
Average Sold Price $409,616 up5.9% -1.8%
Median Days on Market 24 days down41.5% +14.3%
Average Days on Market 38 days down19.2% +5.6%

Remember, within the counties, there is also a deeper dive that needs to be taken into consideration in neighborhoods and price points. Hopefully, this gives you a better idea of what is happening in our real estate market in Northern Virginia.  If you have any questions or concerns or if you are looking to make a move, please feel free to call me.

June Market Update

The Summer Market is Upon Us!

It is hard to believe we are already through the Memorial Day holiday weekend. Time is really flying this year – at least it seems that way to me. Kids are home from college, summer jobs have started, weekend pool parties are in full swing and the real estate market is just as busy as it has been all year. Let’s start with the amazing mortgage interest rates that continue to tumble downward. They are now well into the threes for 30-year fixed rates and are expected to go down even further. This makes now a great time to buy a home! It can still be a challenge to find the right house, as inventory levels remain extremely low – 19% below last year this same week and nearly 30% below what was on the market two years ago. What is also amazing is that sales are up with inventory levels being down. Through April (latest available data point), there was one more sale this year than last year…one more is one more than before. I believe that interest rates will continue to foster sales through the summer as inventory will come on the market. Let’s talk about your plans if you are considering selling – we can position you properly to take advantage of today’s market.

All this being said, the market is not good to all sellers. The reason for this is some sellers are under the belief that their property will sell regardless of price and condition. We are seeing a lot of unrealistic prices on properties, as well as houses in disrepair or in need of substantial work to get the prices sellers are asking. We have seen average prices up over last year by 2.75% which is great, but it is not 2.75% per month like some sellers are pricing their houses at today (and “hoping” to get for them).

From a buyer’s prospective, we are still in a price conscience market. Buyer’s are concerned about paying too much and are analyzing prices closely, especially if they are using a professional REALTOR and not the internet to help them buy a house. The internet is not the way to buy a house today or anytime. The guidance and expertise of a real estate professional is more important today than ever before. If you are considering buying, we should talk sooner rather than later so give me a call.

Have a great June – enjoy the graduation parties!