Trying to pick up trends in the real estate business is a challenge because national stats don’t always sync with what I see on the streets of Vienna or McLean, VA.
Yes, I am talking about the mean streets, places where multiple buyers are still anxiously awaiting new listings even as 2011 arrives. Those two areas are still highly sought after because they rank high in three important NOVA Lifestyle factors: location, schools, and commute.
But I also saw strong demand in my Fairfax, Centreville, Herndon, and Reston home sales in 2010. List price to sale price ratios were tight as the inventory slipped and prices flattened out.
What fueled the local real estate activity?
JOBS and the Federal Home Buyer Tax Credit
The original expiration date for the Federal Home Buyer Tax Credit put a lot of pressure on the local real estate market to meet the April 30th contract deadline. Many home sellers moved-up their listings from May to February to capture the inflamed demand and, sure enough, home buyers snapped them up. Take a look at the spike in all activity starting in late January 2010 that then came crashing down in May 2010.
It was like the faucet was shut off in May
These statistics show that the market low was late in 2008 and into 2009, so anyone looking for that super real estate deal in Northern Virginia in 2010 was shopping a little late (yes, the big sale was way back in 2009). Home buyers in Northern Virginia have to understand that closed prices improved by 4.5% in 2010 over 2009 closed home sale prices.
When holding an “Open House” recently in Vienna, some of the visitors were asking me about the comps I used to determine the home’s value and how the Zestimate on their Smartphone’s showed a much lower value. In my opinion those Zestimates were, again, far off the market (they admit they can be 15% off on their web site, and I was right on).
In 2010, the list price to sell price ratio was slightly over 96%
The number that seems to be a “secret” was that the total number of Northern Virginia home sales in 2010 was down 12.8% from 2009, which was a slow year too. I believe that there were fewer home sales in Northern Virginia because there weren’t as many new homes built. We have become accustom to builders doing big projects, but the ones they were doing in 2010 were much smaller in scale. For example, Pulte’s big project at MetroWest near the Vienna Metro has been on hold since 2008, and only last summer did they start the site work. My feeling is that the sales trailers will probably be set up for “sellin’ ” this spring.
MetroWest is the only “close-in” new home project
To wrap this up, Northern Virginia home sellers can feel a little better in 2011 and home buyers need to get a move on!
- 2010 showed stability in Northern Virginia real estate prices
- More high paying jobs were created in Northern Virginia
- There was a lack of new home construction
- Mortgage interest rates remain at historic lows but qualification requirements are more rigid
- Demand for close in properties has increased while the supply has remained the same
Here is RBI’s most recent video:
- Some Home Selling Tips for 2011 (dougfrancis.com)
- Will Your Real Estate Offer Make the Cut? (dougfrancis.com)
- Things You Should Know Before Moving to Northern Virginia (dougfrancis.com)
- Another Bogus Real Estate Market Statistic (247wallst.com)