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!

Hot & Sticky… The Northern Virginia Real Estate Market

The real estate market continues to be hot – just like the weather.independence day  Inventory levels remain below 7,800 active properties for sale in Northern Virginia.  Last year at this time we had over 9,550 – quite a difference.  There is pent up demand but we are lacking “really good” inventory.  We have buyers that would move up if they found something suitable in a higher price points but nothing seems to be coming on to help with this situation.  So here are a few quick stats on the overall market:

  • Sales of existing homes reached the highest annual pace in over 9 years at 5.29 million.
  • Inventory remains below the 6-month norm and prices are still on the rise, however, this is very hyper-local so ask me for details.
  • Interest rates are at a historic low of 3.48%.

Now, just like the weather, things can be a little sticky…if properties get priced too high, they are sitting on the market.  They are getting lookers, just no offers which at times has led to frustration for our sellers.  It is important to keep in mind proper pricing today is still critical.  To learn more about how we can help you with selling your home, feel free to call me.

The big news recently has been Brexit and how it will affect us in the United States.  Well, virtually immediately, interest rates on mortgages dropped to three year lows.  The good news is they are expected to stay this way for a while.  There is speculation that International investors may sell off their holdings in the UK and invest in the US which could be good news for cities like Washington, DC, New York, Chicago and Los Angeles – let’s keep an eye out for this movement.  The overall sentiment is we may not see its full impact for years but in the short term it will be good for the US housing market.

As always, we are here to help with any questions you may have regarding the Northern Virginia real estate market and have a safe, fun and enjoyable July 4th celebration.

Scott MacDonald

RE/MAX Gateway

Economic Forecast for 2016 and what it means to the Northern Virginia Real Estate Market

Happy Holidays!  Sorry for the delay this month but I wanted to have our Economic Summit with Dr. Stephen Fuller to fill you in on what is coming down the pike for our economy here in Northern Virginia.happy holidays from REMAX gateway

This year sales remained strong and higher than last year indicating we are still in an improving market.  Prices are stable as we wait for higher paying jobs which happened in the last local jobs report.  Higher paying jobs, along with lower inventory will put upward prices on houses in the future.  Next year will be even better than this year but it appears as if 2017 will be the best year of the decade so we have that to look forward to in housing.  Also, new home starts as well as sales are projected to increase in this same manner which will create even more jobs for our local economy.

Additionally, we see no reason that the Continuing Resolution bill will not pass and be implemented which will lead to the first of 8 interest rate hikes by the Federal Reserve.  Both announcements are due the second and third week of December.  The mortgage interest rates published today already have this rise in rates priced into them so we are not expecting a spike in mortgage interest rates next week when it is announced.  It is projected that by 2018, the Fed rate will be about 3.25% and mortgage interest rates will be around 6%.

Our job market will continue to grow in mostly higher paying jobs but the food and leisure jobs still are the strongest in our economy.  Professional Services and Health Care are coming on strong and this is where the higher paying jobs are for us.  This trend will continue for the next few years.

All in all, a bright forecast for our real estate market just in time for the holidays!  If you would like a copy of the presentation he gave us, please let me know and I will send it to you.

Enjoy this time of year with your friends and family and please be safe!  Until next year, Happy Holidays!

Scott MacDonald

RE/MAX Gateway
4090B Lafayette Center Drive, Chantilly, VA 20151
Offices strategically located throughout Northern Virginia.

 

NFL Super Bowl Challange and a “No Deflate-Gate” in the Northern Virginia Real Estate Market!

Watch Scott’s Market Minute!

Low interest rates, low resale housing market inventory and great loan options.  If you are considering buying or selling real estate – contact me for a free consultation 703-652-5777 or scottmacdonald@remax.net

Will You accept Scott MacDonald’s NFL Challange?

Video

LOW INVENTORY: Homes for Sale Needed in Northern Virginia!

Low inventory and multiple offers – listen as Scott MacDonald explains the current housing market from both buyer and seller perspective.  Scott offers practical advice to homeowners who are thinking of selling, as well as, market trends and forecast for the Northern Virginia Real Estate Market.
Contact Scott MacDonald (703) 652-5777 scottmacdonald@remax.net to learn more about your specific real estate market or read scottymacsblog.com/

Why you should close on your home before July 1, 2013 Grantor’s Tax Increase

Big changes are on the forefront for Virginia real estate if you are selling or buying a house.  The state Grantor’s Tax is going from $1.00 per thousand to $2.50 per thousand of the sales price or tax assessed value, whichever is higher on July 1, 2013.  Here is the impact – on a sales price of $500,000 the fee is going to go from $500 to $1,250Grantors Tax Increase to help ease congestion

The tax is typically paid by the seller in a resale scenario and the builder usually passes this fee on to the buyer.  As a result, it has become a nominal cost associated with selling to one of a greater impact and one that will potentially bring attention to people on both sides of the table.  In other states, including Maryland, this tax is absorbed by the seller with first time buyers, is split in most cases but in the end, is a negotiable item between the seller and buyer.  It will be interesting to see if this becomes the case in Virginia.  Our fee is less than Maryland’s but is still is significant enough to take notice and pay attention to what will be the impact as it becomes implemented and the prices increase.

The change goes into effect on July 1st so you will want to plan accordingly.  This year July 1st falls on a Monday so in order to avoid paying the tax, we are encouraging our clients to close by the 26th of June.  This will ensure the property gets recorded at the courthouse prior to the Friday rush that many title companies are expecting and save your money.

Many of you may recall that back in January of 2008, this tax went up 5 times so the same scenario listed above would have resulted in a $2,500 tax on the sale of properties in Virginia.  Therefore, this increase is not as significant.  In March of that year the Supreme Court of Virginia repealed the tax stating a transportation authority NVTA did not have the right to levy taxes.

The additional fees today are also put in place to cover costs associated with transportation initiatives and road improvements in Northern Virginia and Hampton Roads in an effort to ease the congestion in these regions.  As such, this tax is only applicable to these regions.  Let’s see some results, please.

Platinum Group: Hot Topics in the Northern Virginia Real Estate Market

In a recent Platinum Group meeting we discussed many hot topics in the real estate market today.  They included the appraisal issues we are encountering that I discussed in my last blog, new home sales, the rental market and of course, low supply and high demand.

New home prices are rocketing up, incentives are going away, one builder sold 13 houses last weekend in Prince William County and took closing costs down to just $5,000 when they were offering more at the beginning of the weekend.  Nationally, new home sales dropped but not in Northern Virginia.

Platinum Group Hot Topics FEB 2013 scottymacsblog

Lack of resale inventory is leading buyers to new homes.  When buyers go to new homes, their prices increase.  Be careful as a lot of builders don’t have appraisal contingencies in their contracts.  Ask what happens if house doesn’t appraise.

The rental market continues to be on fire.  We have a 1.7 month supply of rentals available in Northern Virginia.  Prices have stabilized and move quickly when they are in good shape.  Additionally, in a recent article, it was estimated there will be another 6.6 million renters in the market.  It makes now a good time to work with investors, understand the rental process or even start a property management company.

One other topic we discussed was the lack of inventory of resale properties on the market.  It has been mentioned that we are at an 11 year low in terms of available properties.  When something is desirable, we have seen as many as 14 contracts on one home.  It is time to structure offers for our buyers so they can win in multiple contract situations.

 

To learn more about the market or our networking group, feel free to reach out to me.  scottmacdonald@remax.net

Now, go sell something!

Top 10 Real Estate Market Predictions for 2013 -Northern Virginia and DC Metro area

Prediction #10 There will be more real estate agents entering the business. As the housing market shifts for the better, some may see it as an easy way to make money. Applications for the sales person exam has more than doubled since last year. This is very important if you are looking to buy or sell a home or investment property; you need a seasoned agent, with the education, knowledge, and experience to help guide you in making the right decisions.

Prediction #9 Interest Rates. I believe mortgage interest rates will stay below 4% as the fed rates are expected to stay around 0.25%. The cost of ownership is drastically reduced when interest rates are down, as well as, making it a great time to refinance. Contact us and we’ll show you what the numbers truly are and how we can help you make the right decision when buying your next house.

Prediction #8 New Home Market. As inventory levels of resale existing homes have been down as much as 30% throughout 2012 in NOVA, we will see new home builders increase in activity and sales. You may want to consider looking at new home builder stocks, builders with strong fundamentals in areas where there is growth and opportunity, economic and jobs, and sustained growth.

Prediction #7 Existing Home Sales. The resale housing market inventory levels have been falling since 2006 and we have had extremely low inventory levels in Northern Virginia, this year in particular. When the market does come up it will most likely be distressed properties because of pent-up inventory.

Prediction #6 Short Sales & Distressed Properties. We will probably see fewer Short Sales on the market during the 1st/2nd Quarters of 2013 should the mortgage relief act run out. Home owners may simply allow homes to go into foreclosure if there seems no true benefit of the short sale process.

Prediction #5 Housing Prices. Housing prices will continue to increase based upon the inventory levels are at or near all-time lows; supply and demand. With lending guidelines and appraisal guidelines in place we will see moderate slow gains and stabilized growth in the housing market.

Prediction #4 Lender Appraisals. I believe we will continue to have appraisal problems in 2013, guidelines are strict, binding an appraiser to work harder. We have seen some ‘bad’ appraisals with com parables outside of neighborhoods, missing items such as bathrooms, bedrooms and even giving extraordinaire value for items. You need an agent that is aware and knows how to handle this process.

Prediction #3 Lending Guidelines. Look for lending guidelines to become more stringent as the Qualified Residential Mortgage (QRM) and Quality Mortgages (QM) along with the required documentation, double and triple checking credit scores and employment verification. These precautions are the result of the housing boom and are now in place as a prevention method, helping ensure a safer housing market and growth.

Prediction #2 Investment in Real Estate. Investors have been the big player in real estate for the last 3-4 years and will continue. The rental market is extremely tight and rental prices continue to climb. Home prices have been low, making excellent returns for the Investor and allowing one to pick up distressed properties, fix-up and rent or resell. The need of rental housing has also increase as previous owners of foreclosed/short sale homes recover financially.

Prediction #1 REMAX Gateway in 2013. As I look into my crystal ball for 2013 for REMAX Gateway I see we will continue to grow and serve our clients. Currently we have 4 office locations: Lorton, Brambleton, Gainesville, and Chantilly; in 2013 we will be opening our 5th location in Arlington County, Virginia. As our agent count increases, we will continue to have the best and brightest agents, the most productive and educated, and we will continue to serve our clients better than any others!

Wishing you the best in 2013!