Scott MacDonald counts down his 2013 Top 10 Preditions for Northern Virginia Real Estate PREDICTION #7 Resale Housing Inventory projection for 2013. scottymacsblog.com
short sales
Scott MacDonald TOP 10 Predictions 2013 Prediction #8
Scott MacDonald counts down his 2013 Top 10 Preditions for Northern Virginia Real Estate PREDICTION #8 Resale/New Home Building projection for 2013. scottymacsblog.com
Coast to Coast “Buzz” – Market Rebound!
As we enter the 4thquarter of the year, we continue to see strong sales in real estate, low inventory levels of existing homes on the market and phenomenally low interest rates. I just got back from the RE/MAX California-Hawaii Regional meetings and all the buzz was how the market is on the rebound and how there has never been a better time to buy a home.
It was funny, as I was headed to the airport back home yesterday, the taxi driver overheard my phone conversations. When I was finally off the phone, he asked if I was in real estate. When I confirmed his suspicion, even he commented – unsolicited – that more people should be buying a home today. He had no real estate experience and he couldn’t understand why people were paying more in rent than if they were to buy under the current conditions. He even made the comment that workers at 7-11 could really buy a house today because they could actually qualify for a mortgage -not like wat was happening in the past.
West Coast to East Coast – the “Buzz” is Market Rebound!
We are at historically high affordability rates for home ownership which makes today a great time to be a home owner or investor. From the investor’s side of the equation, there are many people who cannot buy because of past history, some are only relocating temporarily to the area, and some are just plain old gun shy to buy because of the negative housing market over the last 5 years. Therefore, with prices down from the all-time highs but making their way up the ladder, a good renter pool, great financing options for investors – now is the time to get in the game! Home ownership is a long term investment strategy that can pay big dividends later. To learn more about becoming an investor, call us today. We would be happy to speak with you about your financial goals and objectives.
And the market goes on and on and on…
It is amazing what a difference our real estate market has experienced this year versus the last few years. Previously we were inundated with short sales, foreclosures, dropping prices and very little confidence in the market.
Today, we are at a low point in the number of short sales and foreclosures on 
the market since I started keeping track of them over two and a half years ago. In October of 2010, we had 1,460 short sales on the market, today we have only 386. Additionally, foreclosures are at a low point as well. In November of 2010, we had 516 foreclosures on the market and today we only have 178. Additionally, prices were falling in the Northern Virginia area. According to RBIntel.com our market prices bottomed out in February of 2009 with an average sales price of $307,225. Today our average sales price is $469,800.
We are still off our highs of 2006-2007, but we are headed in the right direction. All of this information coupled with low interest rates has restored confidence in our market.
Rates? Did I just mention rates? Yes I did and they are ridiculous! Yesterday I heard one of our clients locked in a rate of 3.25% with a lender credit of 2%. We continue to see rates decline which leads to the question of how low can they go before more people act on refinancing or purchasing? Only time will tell.
The last area I would like to touch on is our rental market. The inventory of active rentals remains low and interest in these properties remains high. At this time, many people prefer to rent over buying as they remain skittish about buying or are in a situation such as a recent short sale which prohibits them from being able to purchase. This situation has resulted in rental rates rising making investing a viable option for many people – maybe even you!
If you would like more information on how these numbers affect you whether buying or selling a house, or if you would like to discuss becoming an investor, pick up the phone and give me a call. I would love to speak with you about your situation in more detail.
Summertime market…it’s gonna be fun!
The spring real estate market is hopping along as we enter the summertime “fun in the sun” buying and selling season. Our inventory levels remain very low for this time of year – we actually have seen inventory levels on the decline in recent weeks. Multiple contract situations are more the norm than the anomaly, which can be frustrating for buyers. Prices have stabilized but we need to see them increase to help out people in the area that are still underwater with their house values. Although we have people still underwater on their houses, distressed property inventory remains very low – only 11% of all inventory consists of short sales and foreclosures.
The big news this month seems to be the rise in consumer confidence in our area compared with the rest of the country. My feeling is people are becoming more optimistic in Northern Virginia because we have jobs and our housing market is strong. We have a 1.5 month’s supply of resale properties and a 1.1 month’s supply of rental properties. People are not only out looking at properties but they are actually buying houses. Agents are working hard and diligently working on listings and contracts. The environment around the office is fast paced and optimistic as the agents are busy helping our clients buy and sell houses. Our lenders and title partners are expressing a lot of the same sentiments with the market and its activity. In addition, there is a lot of “good” publicity surrounding the real estate market which is a welcomed reprieve from the last several years of nothing but negative news. All of this information will propel us into the summertime selling season so if you are looking at your options with real estate, give us a call.
A great time to buy…now?
It is definitely an interesting time in real estate in Northern Virginia. We have extremely low inventory levels that remain below normal for this time of year. As an example in January of 2008, we averaged 15,500 active listings, in 2009 it was 10,200, in the year of Snowmagedon in 2010 it was 4,800 because people took their houses off the market and agents couldn’t get out and about to list them, in 2011 it was 5,800 and now we are at 4,700. What is interesting to note is the month’s supply of houses in the same time frame – 2008 it was 10.8, 2009 4.0 and since then it has been 2.3 in 2010, 2.8 in 2011 and this year 2.2. What this clearly indicates is there are buyers out in the marketplace looking for homes in the winter months – not just the spring months now. Interest rates remain very low – below 4% for 30 year fixed rates – jobs are being created here so people are moving into the area and rental rates are rising throughout Northern Virginia.
If your family circumstances, job status, or you just have the desire to sell your house and move up to a bigger home, now is a great time to do so. Houses that are priced right, in the right condition and staged properly are attracting offers. One of the biggest parts of this equation is the price – price sells today. Sellers cannot price a little high for negotiations as we have seen that they languish on the market in this situation. Price it competitively and it will sell.
Buyers have a great opportunity today. The housing affordability index is at an all-time high and in many cases house payments are less than rental payments even before considering the tax benefits of home ownership. For buyers looking for the long term benefits of home ownership, there historically has not been a better time. Prices are remaining stable, interest rates are low, and the housing industry is on the rebound meaning we have already hit the bottom and we are on the upswing if you were trying to time the market.
Whatever your situation is, we can help. Please feel free to contact us to discuss your personal needs in more detail and see if now is the right time for you to make a move.
Market, market, market!
How’s the market – this is a question so many people want to know the answer to on a regular basis. My answer is, it depends.
Are you a buyer? If so, the answer is definitely yes. Interest rates remain at historically low levels, prices are stable in most areas and increasing in others. If houses are on the market now, the sellers are serious and you can negotiate a good deal. The monthly expense of renting is equivalent to owning in many cases, if not higher. In addition, each payment made for the home owner goes towards the loan balance giving the owner equity over time adding to the owner’s personal wealth. Renting only goes to making landlords wealthy. Other reasons to buy include pride in ownership, sense of community, stability and the ability to improve the property without permission from a landlord – just to name a few.
If you are a seller, what is the price range of your property and where is it located? Every market is different and each property should be looked at individually. There are pockets throughout Northern Virginia where prices are escalating but further out, it isn’t the case. In Centreville as an example, the average sales price of detached homes has dropped every month since July. In South Riding, houses priced between $550,000-650,000 have not had a sale in nearly 70 days. This is not the case closer in towards Vienna, Falls Church and Arlington. Houses are selling quickly and for top dollar. However, in these areas higher priced condos – especially one bedroom units are staying on the market much longer.
In all of these markets, houses and town houses that have compelling prices, not necessarily the ones that are priced right or priced at market values, are the ones that are attracting multiple offers. For houses to sell quickly in today’s market, price is the leading indicator followed by staging, condition and location. Luckily, our distressed property inventory remains low relative to the rest of the country. We are not seeing the influx of foreclosed properties which definitely affects values.
Our unemployment rate is one of the lowest in the country in Northern Virginia – 4.9%, our wages are amongst the highest in the country and consumer confidence is higher here than elsewhere so we are anticipating a strong 2012 in the housing market.
As you can see, it is not a simple question to answer. Each person’s situation is different and therefore you should ask a Gateway professional for detailed information specifically about you. If someone answers, “unbelievable” or “great” be wary. Get it? Got it? Good!
Scott's Motivation and Real Estate Market Updates 