Blog • August 31, 2023

Market Update – July 2023

by Denise Fuller

As the weather heats up and we experience longer days, it seems we become more active in all areas of our lives. The housing market is no different. The full month of June saw an increase in the number of homes sold and the number of homes on the market for sale. The latest real estate statistics for Northern Virginia are showing signs of an early Spring market being pushed into our summer months. Here is the market update for July 2023.

Statistics and What it Means

Using statistics from MarketStats by ShowingTime, we looked at 10 counties in Northern Virginia – Alexandria, Arlington, Fairfax, Falls Church, Fauquier, Loudoun, Manassas City, Manassas Park City, and Prince William.

The median sale price for a home in Northern Virginia is now $663,000, which is down 1% from the previous month and up 4% from last year. This may be the result of measures taken by the Federal Reserve to curb inflation. In their June announcement, they did not increase their key interest rate but warned they “would be prepared to adjust the stance of monetary policy as appropriate if risks emerge”. This ensured that interest rates stayed between 6.5 to over 7%.

At the end of June 2023, there were 3,158 homes sold in that month. This is up 5% from the previous month and down 18% from last year. The number of Days on Market for Northern Virginia remains the same at 13 days.

Inventory continues to be low with many home owners hesitant to sell their homes with no place to go. They are unwilling to give up their 2.5% mortgage interest rate to buy at 6.5%, no matter the profit margin. Still inventory appears to be improving. There are 2,676 homes for sale, which is a 9% increase from the previous month.

Bright MLS Buyer Demand Index

According to Bright MLS Home Demand Index, buyer demand in Northern Virginia remains “Slow”, down from “Steady” buyer demand the month before. The Bright MLS | T3 Home Demand Index measures and tracks consumer and real estate professional behavior related to shopping for real estate by looking at metrics such as views of homes online and in-person showings. Ratings are categorized into 5 score points: Limited (under 70 points), Slow (70-89), Steady (90-109), Moderate (110-129), and High demand (over 130).

The highest ranking areas in Northern Virginia are: MODERATE DEMAND in Arlington (126), Alexandria (119), Prince William County (115), Manassas City (110), and STEADY DEMAND in Stafford County (102).

What the Experts are Seeing

Most agents agree that pricing and condition have become extremely important in this current market. Homes priced well and in excellent condition are going under contract quickly, over-asking price, and with few contingencies. This is because inventory is so low at this time. Once a home shows well and is priced at market value, serious buyers are compelled to compete for the home. This means offering above asking price and waiving contingencies like a home inspection. This may be needed to ensure an offer is accepted.

The Month’s Supply of inventory of homes has gone from 0.8 to 1.2 in June 2023. Month’s Supply refers to how many months it will take to sell all the current homes currently on the market. Most consider a balanced market, where buyers and sellers are on the same playing field, to be about 3-6 months supply. Though improving, it illustrates just how low inventory is for this market update in July 2023.

Mortgage Interest Rates

Graph showing interest rates — Source: NerdWallet.com

This is the new normal for now. The annual percentage rate on 30-year conventional mortgages hovers around 6.8%. This is 17 basis points lower from the previous week and also up 130 basis points from last year. The latest Consumer Price Index figures (used to measure inflation) were announced in June to be at 3%. This percentage shows change over time in the prices for a basket of consumer goods. The Federal Reserve has stated that they want to see the inflation figure down to 2%. Being just 1% off of the target is good news for everyone. Many experts are hopeful that the inflation rate of 2% will be achieved soon. When this happens, the Federal Reserve can then halt raising the central bank’s rates. This will result in lower interest rates for everyone.

Advice to Sellers

Homeowners are still enjoying low available inventory/competition, which helps them get above asking prices on the sale of their homes. It’s not sure how long this will last. Home pricing and good condition remain crucial ingredients to ensure a smooth sale. It also appears inventory levels are beginning to increase. Still, the real estate market remains as strong as ever. Northern Virginia is NOT about to CRASH, as some are speculating. The area remains a great place to live and own a home.

FREE HOME VALUE

Advice to Buyers

For the home shopper, the mortgage interest rate around 6.5% is the new norm. Most agree that Northern Virginia has a very strong real estate market grounded in its proximity to Washington DC, great schools, and endless amenities. This means that home owners will see financial gains the longer they own a home in the area. As a reminder, those who own their home have a median net worth 40 times that of renters.

Bottom Line

It appears the Spring market was delayed and now just beginning. We’re optimistic this energy will continue into the fall and make for an active Northern Virginia real estate market.

Questions/Concerns? Please contact me.

Also feel free to compare this update with last month’s Market Update – June 2023.

Blog • July 27, 2023

Your Home Goes Under Contract. Now What ???

by Denise Fuller

5 IMPORTANT STEPS AFTER YOUR HOME GOES UNDER CONTRACT

For a home seller, there’s no better feeling than having your home go under contract quickly and at the price you wanted. It’s important to know that this is an important time to stay vigilant and maintain realistic expectations. After your house goes under contract, a Realtor typically assists with various tasks to facilitate the closing process. This may include coordinating with the buyer’s agent, ensuring all necessary documents are submitted, scheduling and negotiating inspections, and providing guidance and support until closing is finalized. After your home goes under contract, the real work of an experienced real estate agent begins.

1. Send HOA/CONDO Documents to Purchasers

One of the first responsibilities of an agent is to ensure that Home Owners Association (HOA) and Condominium (CONDO) Resale Packages are delivered to the prospective buyer as soon as possible. In Virginia, the Virginia Property Owners’ Association Act allows for a Buyer to cancel the contract “within 3 days, or up to 7 days if extended by the ratified real estate contract”. This allows the purchaser time to fully review important information about the rules, regulations, fees, and restrictions imposed by an HOA and/or CONDO.

By delivering these documents earlier rather than later, the Realtor ensures that the buyer has access to all relevant information about the property right away. These packets contain information such as: Governing Documents, Financial Information, Meeting Minutes, Insurance Information, and Resale Certification. If a buyer chooses to cancel the contract after 3 days, it allows the agent to immediately put the home back on the market while marketing is still fresh.

2. Ensure the Earnest Money Deposit is Delivered

An earnest money deposit (EMD), also known as a good faith deposit, is a sum of money provided by a buyer to demonstrate their serious intent to purchase a property. It is typically given to the seller via a title company upon the acceptance of an offer. The purpose of the earnest money deposit is to show the seller that the buyer is committed to the transaction and to provide some financial security in case the buyer fails to fulfill their obligations under the contract.

The amount of the earnest money deposit is negotiable and can vary depending on factors such as the local real estate market, the purchase price of the property, and any specific terms agreed upon by the parties involved. The deposit is typically held in an escrow account until the closing of the transaction, at which point it is applied towards the buyer’s settlement costs.

If the buyer successfully completes the purchase, the earnest money deposit is typically credited towards the cost of settlement for the buyer. However, if the buyer fails to fulfill their obligations as outlined in the contract, the seller may be entitled to keep the full or partial amount of the earnest money deposit as compensation for the time and effort lost during the transaction.

3. Inspections

The listing agent can help the seller prepare for the inspection by providing guidance on what to expect and how to make the property presentable. Before a home is put on the market for sale, an agent will offer suggestions on repairs or improvements that could enhance the home’s condition and appeal. These will help to make the home inspection process go more smoothly. In more remote or larger parcels of land, well and septic inspections are also the norm.

In addition to coordinating the date of the home inspection with a homeowner and a purchaser’s agent, the Realtor may also facilitate access to the home and/or property. During the inspection process, the agent will make themselves available to answer any and all questions from the home inspector and buyer’s agent. They also ensure that all areas are accessible and any necessary utilities are turned on. They will also keep the homeowner up to date on everything that is going on.

If the inspection reveals any issues or deficiencies, the listing agent can help the seller navigate the negotiation process with the buyer. They can provide guidance on how to respond to repair requests or negotiate any necessary adjustments to the sale price. Overall, the listing agent acts as a liaison between the seller and the home inspector and the buyer’s agent, providing support and guidance throughout the inspection process.

4. Appraisal

The listing agent can play a significant role in the appraisal process by providing relevant information and supporting documentation to the appraiser. Here are some ways in which a listing agent can assist:

a. Accompanying the appraiser during the inspection: The listing agent can be present during the appraisal inspection to answer any questions the appraiser may have and provide additional information about the property.

b. Providing property details: The listing agent can provide the appraiser with accurate and detailed information about the property, including its features, upgrades, and recent improvements. This helps the appraiser understand the unique aspects of the property.

c. Presenting a comprehensive listing package: The listing agent can prepare a comprehensive package that includes relevant documents such as floor plans, property surveys, and any recent appraisals or inspections. This package provides the appraiser with a complete picture of the property.

d. Sharing comparable sales: The listing agent can provide the appraiser with recent comparable sales in the area that support the listing price. These comparable properties help the appraiser assess the market value of the property being appraised. It also helps to ensure the appraisal amount is as close to full sale price as possible.

It’s important to note that while a listing agent can provide assistance, the appraiser is an independent professional who ultimately determines the appraised value based on their own analysis and methodology.

5. Communicate with Buyer’s Lender

An experienced real estate agent is skilled in communicating with a slew of professionals throughout the transaction process. The purchaser’s lender is no exception. The agent provides the lender with all necessary documents such as disclosures, property information, etc. If the buyer’s lender has any questions or requests for additional information, the listing agent can promptly respond and provide the necessary details to keep the transaction on track.

The listing agent can help ensure that any lender-required repairs or conditions are addressed promptly, working with the seller to meet these requirements within the specified timeframes. One of the most important roles a real estate professional plays in the closing process is to ensure the completion of all requirements and that deadlines are met.

It’s important to note that while a listing agent can assist with communication between the buyer’s lender and the seller, they cannot provide financial or legal advice. Buyers and sellers should consult with their respective professionals for guidance on specific financial and legal matters.

Bottom Line

A real estate professional provides many crucial roles in the real estate settlement process, from start to finish. A Realtor’s presence is most valuable when something does not go as planned. Having a trained and experienced real estate professional to gauge situations, plan in advance to avoid unnecessary delays, and negotiate on behalf of their clients, is ABSOLUTELY VITAL.

Questions/Concerns? Please contact me.

Also feel free to check out the latest market update. Market Update – June 2023.

Blog • July 11, 2023

Market Update June 2023

by Denise Fuller

The latest statistics show that the housing market remains to be strong in Northern Virginia. Home prices are up from last month, though still down from the pandemic-level increases of the past 2 years. And other indicators point to buyers still looking for new homes in spite of the higher interest rates and inflation issues. Due to low inventory, homes in good condition and that have been priced properly are flying off the shelves. What the future holds for the housing market in this area remains uncertain. This is the market update for June 2023.

Big News !

The Federal Reserve announced it won’t be increasing rates in June.

Statistics and What it Means

Home values continue to go up in Northern Virginia. Using statistics from MarketStats by ShowingTime, we looked at 10 counties – Alexandria, Arlington, Fairfax, Falls Church, Fauquier, Loudoun, Manassas City, Manassas Park City, and Prince William.

The median sale price for a home in Northern Virginia is now $679,000 up from $638,000 last month. This is a 5% increase from last month and a 1.5% increase from this time last year.

Inventory continues to be extremely low. At the end of May 2023, 3,006 homes were sold. This is up almost 25% from the previous month and down 27% from the previous year.

In May, it took an average of 13 days on average for a home to go under contract. This is less than the previous month when it took 17 days and higher last year during a crazy market when it took when it took just 9 days to go under contract.

Additionally, there were 2,971 homes coming fresh on the market. This was up 9% from the previous month and down 41% from the same time last year. There were much more homes up for sale last year. Still, homes that are in good condition and priced well, are enjoying multiple offers and contingencies waived by competing. These homes go under contract quickly and oftentimes over asking price.

What the Experts are Seeing

Most agents agree that pricing and condition have become extremely important in this current market. These homes are able to go under contract quickly, over-asking price, and with few contingencies. This is because inventory is so low at this time. Once a home shows well and within budget, serious buyers are compelled to compete for the home. This means offering above-asking price, waiving the home inspection, and waiving financing and appraisal contingencies if needed.

Buyer Demand

According to Bright MLS Home Demand Index, buyer demand in Northern Virginia remains “Steady”, the same as last month. The Bright MLS | T3 Home Demand Index measures and tracks consumer and real estate professional behavior related to shopping for real estate by looking at metrics such as views of homes online and in-person showings. Ratings are categorized into 5 score points: Limited (under 70 points), Slow (70-89), Steady (90-109), Moderate (110-129), and High demand (over 130).

The highest ranking areas in Northern Virginia are: HIGH DEMAND in Arlington (142), Alexandria (132), Falls Church (132); MODERATE DEMAND in Prince William (110); and STEADY Manassas City (10).

The month’s supply has fallen to 0.8 from 0.96 the previous month. This number shows how many months it will take to sell all the current homes now on the market. Most consider a balanced market, where buyers and sellers of homes are on the same playing field, to be about 3-6 months supply. It illustrates how low inventory is at this time. Many experts speculate that this will keep home value to remain steady in Northern Virginia in the coming months.

Mortgage Interest Rates

This is the new normal. The annual percentage rate on 30-year conventional mortgages hovers around 6.8%. This is 25 basis points higher from the previous week and also up 130 basis points from last year. Many experts want to believe rates will remain this way for a while and hopefully start going down. Still, most agree that we won’t be seeing rates around 4% anytime soon. According to Joel Kan, vice president and deputy chief economist at Mortgage Bankers Association, “Both conventional and government home purchase applications increased last week. However, activity was still nearly 28% below last year’s pace.”

Advice to Sellers

Homeowners are still enjoying a seller’s market. Many homes are experiencing multiple offers, less time to go under contract, and with less inspections and contingencies. If life circumstances require you to sell soon, this is the time to reach out us to discuss ways to get your home “show ready” and receive an estimate of your net proceeds after closing costs. There is not crystal ball as to what happens in the housing next.

FREE HOME VALUE

Advice to Buyers

For the home shopper just starting the search, it’s important you understand the current market and are able to have a clear understanding. This is vital in setting realistic expectations. Northern Virginia has a very strong real estate market grounded in its proximity to Washington DC, great schools, and endless amenities. This means that your investment is likely to increase in the long term. Most experts say to plan to live in your home at least 3-5 years to see the greatest financial benefits such as home equity and home valuation increases. Be sure to find out if buying or renting in 2023 makes more sense to you.

WATCH RELATED VIDEO

Bottom Line

Northern Virginia is still a great place to live and own a home. If you are thinking of selling and want to get an estimate of how much you would net after a home sale, please reach out to us. If you are a home buyer and want to be in the best position to have your offer accepted, let us work for you.

Questions/Concerns? Please contact me.

Also feel free to compare this update with last month’s Market Update – May 2023.

Blog • May 18, 2023

Market Update May 2023

by Denise Fuller

The statistics from MarketStats by ShowingTime confirms that buyer demand in Northern Virginia remains strong as inventory continues to be low. Even as mortgage interest stay around 6.5%, buyers are not discouraged. Here it the latest real estate market update May 2023.

Statistics and What it Means

Home values keep going up in Northern Virginia. The median sale price for a home in Northern Virginia is now $638,000, up from $619,000 last month. This is a 3% increase and a 1% decrease from this time last year.

Inventory continues to be extremely low. At the end of April 2023, 2,412 homes were sold. This is up 4% from the previous month and yet down 34% from the previous year. Additionally, there were 2,727 homes coming fresh on the market. This was down 5% from the previous month and down 48% from the same time last year. There were much more homes up for sale last year. Still, buyers are having to compete with several others to get their offers accepted. Homeowners are enjoying multiple offers and getting their home under contract quickly.

In April, it took an average of 17 days for a home to go under contract. This is less than the previous month when it took 22 days and higher last year during a crazy market when it took when it took just 9 days to go under contract.

What Agents are Seeing

Most agents agree that the higher mortgage interest rates are no longer discouraging home buyers. Once a home is in good condition, they seem to fly off the shelf. Many are going under contract before they hit the market as Active, settle well over asking price, and with few inspections and contingencies. Condition of the home and location are two important factors when this happens. Lenders also comment that most buyers are only putting up to 5% down as home buyers are trying to keep a reserve of cash on hand.

Buyer Demand

In general, buyer demand in Northern Virginia is now “Steady”, up a notch from “Slow” the previous month. This is according to Bright MLS Home Demand Index. The Bright MLS | T3 Home Demand Index measures and tracks consumer and real estate professional behavior related to shopping for real estate by looking at metrics such as views of homes online and in-person showings. Ratings are categorized into 5 score points: Limited (under 70 points), Slow (70-89), Steady (90-109), Moderate (110-129), and High demand (over 130).

The highest ranking areas in Northern Virginia are: HIGH DEMAND in Arlington (161); MODERATE DEMAND in Prince William (122), Alexandria (119), Falls Church (115), and Stafford (112).

Month’s Supply

The month’s supply is now at 0.96, similar to last month’s measure of 1. This number shows how many months it will take to sell all the current homes now on the market. Most consider a balanced market, where buyers and sellers of homes are on the same playing field, to be about 3-6 months supply. It illustrates how low inventory is at this time. Many experts speculate that this will keep home value to remain steady in Northern Virginia in the coming months.

Mortgage Interest Rates

This is the new normal. The annual percentage rate on 30-year conventional mortgages hovers around 6.5%. This is 25 basis points higher from the previous week and also up 130 basis points from last year. Many experts want to believe rates will remain this way for a while and hopefully start going down. Still, most agree that we won’t be seeing rates around 4% anytime soon. According to Joel Kan, vice president and deputy chief economist at Mortgage Bankers Association, “Both conventional and government home purchase applications increased last week. However, activity was still nearly 28% below last year’s pace.”

Advice to Sellers

Homeowners are enjoying a return to a seller’s market. Many homes are experiencing multiple offers, less time to go under contract, and with less inspections and contingencies. If life circumstances require you to sell soon, this is the time to reach out us to discuss ways to get your home “show ready” and get an idea of your home’s current market value. Even more important is to know your numbers, in terms of how much net you can expect after paying the costs of a home sale.

FREE HOME VALUE

Advice to Buyers

For those whose circumstances making home buying more favorable than continuing to rent should not wait. Northern Virginia has a very strong real estate market that does not appear to be going away. This means that your investment is likely to increase in the long term. Most experts say to plan to live in your home at least 5 years to see the greatest financial benefits such as home equity and home valuation increases.

Bottom Line

Questions/Concerns? Please contact us.

Also feel free to compare this update with last month’s Market Update – April 2023.

Blog • May 11, 2023

Rent or Buy in 2023?

by Denise Fuller

Many renters are fed up with paying someone else’s mortgage. Still they wonder if they can afford to buy a home at this time. As mortgage interest rates spiked at the beginning of 2023 to over 7%, homebuyers faced higher monthly payments, less inventory, and higher home prices. They want to know whether they should rent or buy a home in 2023.

CURRENT MARKET CONDITIONS

This current real estate market is facing strong home prices, mortgage rates around 6.5%, and lower than usual inventory. In our last Market Report for April 2023, we summarized just that. Northern Virginia remains a sought-after area to live and work and the numbers show that. Home prices were up 0.7% from last year and a full 6% from the previous month. Additionally mortgage interest rates doubled from a year ago which initially shocked many homeowners. The number of homes for sale are down about 35% from last year and last month, which means buyers have less choices of homes to choose from. These conditions made made people wonder if they should continue to rent in hopes of lower prices, lower mortgage interest rates and a wider selection of homes.

WHAT THE NUMBERS SAY

According to the National Association of Realtors, two-thirds of a person’s wealth comes from owning their home. Additionally, the National Association of Realtors also says that homeowners have up to 40 times more net worth than renters. These numbers show that in most instances, it is better to own rather than rent. Still, most would agree they would prefer to wonder but wonder if they can afford to own.

WATCH THE RELATED VIDEO

MONTHLY PAYMENTS
Firstly, renters should be aware that they are paying a mortgage – someone else’s mortgage. Those buying investment properties make sure the monthly rent will cover their mortgage with the lender. This is done even before they purchase a home. So renters are already paying this amount, sometimes more. Secondly, national figures show that rents are increasing each year. Many renters are already facing this new reality. This differs from a monthly mortgage payment that stays the same month after month, year after year. Additionally, the longer a person pays their mortgage, the more equity they build until their home becomes a valuable asset. Once you have equity and mortgage rates fall, you are able to refinance at a lower rate and possible lower your monthly mortgage payments even more.

DOWNLOAD FREE 2023 BUYING GUIDE

EVERYONE IS DIFFERENT
This is not to say renting is all bad. There are definitely some instances when renting a home makes much more sense. According to U.S. News, “renting allows you time to ensure the new location is the right fit, realize you’ve downsized too significantly or decide you would rather split time in two or more locations. It provides some breathing room before making another significant investment”.

BOTTOM LINE
In general, most would agree that owning your home is preferred to renting. Still, because each situation is different, getting good guidance throughout life’s adventures is critical. It’s a hard decision on whether to rent or buy a home in 2023. It’s smart to contact a trusted realtor early in the process and a great realtor will be by your side for a lifetime.

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Blog • April 12, 2023

Market Update April 2023

by Denise Fuller

The statistics from MarketStats by ShowingTime confirms that buyer demand is high and home prices continue to go up in Northern Virginia. Even as mortgage interest stay around 6.5%, buyers are not discouraged. Here it the latest real estate market update April 2023.

Statistics and What it Means

Home values keep going up in Northern Virginia. The median sale price for a home in Northern Virginia is now $619,000, up from $585,000, last month. This is a 6% increase from the previous month and 0.7% increase from this time last year.

Inventory is extremely low but getting better. By the end of March 2023, there were 2,310 homes sold. This is a 35% increase from last month and a 33% decrease from last year. There were a lot more homes available for sale last year. This year, with less homes to choose from, buyers are once again competing to get their offers accepted. Homeowners are getting multiple offers and settling quickly.

The average number of days it takes for a home to go under contract is now 22, down 10 days from last month and up 10 days from last year. Again, due to less inventory and demand from buyers, homes are beginning to fly off the shelves again.

The median price per square foot per home is now $289, about the same from last month and down 2.4% from last year.

The total value of homes sold amounted to $ 1,658,003,739. This is up 44% from last month and down 30 from this time last year. This rounds up the numbers for the latest market update for April 2023 for Northern Virginia.

What Agents are Seeing

More and more agents are reporting multiple offers on homes in great condition, often going under contract in a few days. As interest rates have stabilized around 6.5 %, buyers don’t seem intimated and are out shopping. This may also be due to lenders offering programs that make monthly interest payments more manageable for buyers.

In general, buyer demand in Northern Virginia is still considered “Slow”. This is according to Bright MLS Home Demand Index. The Bright MLS | T3 Home Demand Index measures and tracks consumer and real estate professional behavior related to shopping for real estate by looking at metrics such as views of homes online and in-person showings. Ratings are categorized into 5 score points, from Limited (under 70 points) up to High demand (over 130).

The highest ranking areas in Northern Virginia are: HIGH DEMAND in Arlington (144) and Broad Run (143); MODERATE DEMAND in Alexandria (128); and STEADY DEMAND in Prince William (98) and Catlett (97).

WATCH FULL VIDEO

Month’s Supply

The month’s supply is now at 1.0, similar to last month’s measure of 1.2. This number shows how many months it will take to sell all the current homes now on the market. Most consider a balanced market, where buyers and sellers of homes are on the same playing field, to be about 3-6 months supply. It illustrates how low inventory is at this time. Many experts speculate that this will keep home value to remain steady in Northern Virginia in the coming months.

Mortgage Interest Rates

According to Nerd Wallet, the annual percentage rate on 30-year conventional mortgages is at 6.494. This is 25 basis points higher from the previous week and also up 138 basis points from last year. Many experts are hesitant to make predictions on how the rates will go from here. The main takeaway is that most experts agree rates will not return to 4% anytime soon and that rates are still relatively normal considering historic highs around 15%.

Advice to Sellers

FREE HOME VALUE

Advice to Buyers

Buyers who have realized that 6% interest rates out-weigh renting should not start the process before reaching out to expert real estate agents to prep you to get your offer accepted and success in real estate. The truth is that “timing the market” doesn’t work. Northern Virginia has a very strong real estate market. Home prices continue to go up year over year. Most buyers are using programs from their lenders to keep the monthly payments down. If rates ever drop, they can always refinance at that time. We remind you that according to the National Association of Realtors, “The net worth of a typical homeowner is about 40 times the net worth of a renter.”

Bottom Line

Northern Virginia is still a great place to live and own a home. If you want to know more, reach out to us and let us work for you.

Questions/Concerns? Please contact us.

Blog • April 6, 2023

Is it a Good Time to Sell Your Home in 2023?

by Denise Fuller

Some homeowners are wondering if this is the time to sell. With low inventory, they can surely benefit from great prices, less inspections, and more flexible closings. Yes, some may wonder if this is truly a good time. Here are some reasons to sell your home in 2023.

LIFE CIRCUMSTANCES

Most people sell their homes because of life circumstances, and rightfully so. Trying to make decisions and trying to “time” the real estate market create more indecisiveness and can potentially hamper your quality of life.

According to Keeping Current Matters, 21% of homeowner sell their home to be closer to loved ones. This is different from the same survey in 2019 when the National Association of Realtors reported that 15% of homeowners sold because their house was too small and 14% was to be closer to family and friends.

SELLERS MARKET DUE TO LOW INVENTORY

Another good reason to sell your home in 2023 is that it’s a Seller’s Market. This means that home sellers have the advantage when putting their homes up for sale. This is because of the extremely low inventory nationally and in Northern Virginia.

Nationally, the month’s supply is 2.6. This means it will take about 2.5 months for the homes currently for sale to be sold. In Northern Virginia, the month’s supply is at 1.2. This means the inventory is much more limited and this puts home sellers at an advantage.

DOWNLOAD FREE 2023 SELLER’S GUIDE

BUYERS AREN’T SCARED OF MORTGAGE INTEREST RATES

Finally it seems that mortgage interest rates are not taking major turns upward or downward. The rates have been hovering around 6.5% for over a month now. Most analysts predict that by the end of 2023, rates will remain in the 6.5 percent range. This is a good sign of stability and makes this a good time to sell your home in 2023.

So far this year, the sticker shock of new normal of the 6.5% interest rates have not deterred home buyers. First-time buyers are no longer scared by the 6% rate while others remember when rates were around 15%. Demand for homes to buy still outpace the amount of homes for sale. Renters escpecially see the advantage of buying their own home versus paying someone else’s mortgage. This is why sellers are rest assured to get a fair price for their home. The difference is the rate of appreciation from last year summer. During the pandemic, homes were appreciating up to 20% in one year. Now, the appreciation in Northern Virginia is around 2% compared to last year.

WATCH THE RELATED VIDEO

NEED FOR DOWNSIZING

Home owners who are thinking of downsizing are also in a good position to sell their home in 2023. Whether children have left the home or it’s an effort to minimalize lifestyles, needing less space to live makes it a good time to sell your home in 2023. Typically, downsizing also reduces the cost of the home so giving up a 4% mortgage rate to then take on a 6% rate when purchasing a new home is easier. Most buyers feel comfortable securing a new home and then waiting to refinance in the coming years, if rates go down even further.

THINKING OF SELLING YOUR HOME?

If you’re thinking of selling your home, it’s important to start with good information like a Comparative Market Analysis (CMA). This is an important tool in getting a great estimate on how much your home would sell for. Real estate specialists compare your home location, features, amenities, etc. with similar homes that have sold recently.

HOW TO REQUEST A CMA

If you have a real estate agent or have worked with one in the past, you can contact them and request a CMA. At Home Estate Realty, we produce monthly CMA’s for all our past clients. If you’re not working with an agent, a great place to start is HERE. We provide this service FREE of COST to anyone interested with no obligation.

BOTTOM LINE

Northern Virginia remains a great place to own a home. Whether you own your own home and thinking of selling or you want to buy a home,

CONTACT US

Blog • March 17, 2023

Market Report – March 2023

by Denise Fuller

REAL ESTATE IN NORTHERN VIRGINIA

This market update for March 2023 for Northern Virginia shows that despite the fact that home sales are down, home prices remain strong. Compared to last year this time, home prices are, on average, 2% higher. Inventory remains low and buyer demand is increasing as mortgage interest rates level are back under 7%. In this article, we’ll review the latest statistics and let you know how the numbers translate for home sellers and home buyers. Here it the latest real estate Market Report – March 2023.

Statistics and What it Means

Using data from MarketStats by Showing Time, the median sale price for a home in Northern Virginia is now $585,000, up from $575,000 the previous month. This is a 2% increase from the previous month and a 2% increase from this time last year. On a national level, housing prices were up 3% from last month and last year. This increase is no where near the 15-20% increases during the pandemic. It seems to suggest that the efforts to curb inflation are working.

By the end of February 2023, there were 1,707 homes sold. This is 26% increase from last month and a 25% decrease from last year. As interest rates fell below 7%, buyer demand increased and many of the homes that were sitting on the market before the holidays finally went under contract. Agents were even reporting multiple offer situations during this time.

The average number of days it took to sell a home is now at 32, down 5 days from last month and up 11 days from last year.

The median price per square foot per home is now $288, about 1% up from last month and down 0.7% from last year.

The total value of homes sold amounted to $ 1,155,195,417. This is up 27% from last month and down 22% from this time last year. This rounds up the numbers for the latest market update for March 2023 for Northern Virginia.

What Agents are Seeing

Some agents are reporting multiple offers and over-asking price on some homes. In general, buyer demand in Northern Virginia started to go down as mortgage interest rates went above 7% again. At this time, buyer demand for this area is considered “Slow”. This is according to information from Bright MLS Home Demand Index. This metric measures demand from buyers using data such as showing requests an other Bright MLS metrics.

In March, only two areas had “Moderate” buyer demand – Arlington and Alexandria. Areas that had the next level down in buyer demand “Slow” were Prince William County, Fairfax, and Falls Church (in that order). Loudoun County was measured to have “Limited” buyer demand.

Month’s Supply

The month’s supply is now at 1.2, which is down from 1.6 the previous month. This number shows how many months it will take to sell all the current homes now on the market. Most consider a balanced market, where buyers and sellers of homes are on the same playing field, to be about 3-6 months supply. It illustrates how low inventory is at this time. Many experts speculate that this will keep home value to remain steady in Northern Virginia in the coming months.

Mortgage Interest Rates

According to Nerd Wallet, the annual percentage rate on 30-year conventional mortgages is at 6.719. This is down 27 basis points from the previous week (when it was above 7%) and also up 249 basis points from last year. Many experts are hesitant to make predictions on how the rates will go from here. The main takeaway is that most experts agree rates will not return to 2-3% anytime soon and that rates are still relatively normal considering historic highs around 15%.

Advice to Sellers

If you’re in a situation where you need to sell your home, pricing will be important to understand. Now that a few months have passed since the cool down in home buying, you will have a better perspective of how much you can get for you home. It’s important to note though that buyer demand seems to be high now. There is no telling what the next months will bring.

Advice to Buyers

Buyers who are discouraged by higher interest rates should keep in mind that rates are not expected to decrease significantly anytime soon. While the amount you can spend on a home has probably gone down since the pandemic, if you can afford to buy a home, then it should be considered. Additionally, with less buyers in the marketplace, it means competition is not as high as it once was. The likelihood of negotiations and inspections are higher. Lenders can assist you with finding the best course of action for you – whether using a first time homebuyers program, buying down interest rate points, or using a “buydown” option. There will never be a time when you can get low rates AND low home prices. Since homeowners have about 40% more net worth than renters (according to the National Association of Realtors), it will be a good time to buy a home when you can afford it. Trying to “beat the market” shouldn’t be your tactic when it comes to your financial future.

Bottom Line

Northern Virginia is still a great place to live and own a home.

Questions/Concerns? Please contact us.

Also feel free to compare this update with last month’s Market Update – February 2023

Blog • February 21, 2023

Market Update – February 2023

by Denise Fuller

This market update for February 2023 for Northern Virginia shows that despite the fact that home sales are down, home prices remain strong. Compared to last year this time, home prices are, on average, 8% higher. Inventory remains low and buyer demand is increasing as mortgage interest rates level off and the holidays are behind us. In this article, we’ll review the latest statistics and let you know how the numbers translate for home sellers and home buyers. Here it the latest real estate market update February 2023.

Statistics an What it Means

Using data from MarketStats by Showing Time, the median sale price for a home in Northern Virginia is now $575,000 down from 565,000 the previous month. This is a 2% decrease from the previous month and a 8% increase from this time last year. On a national level, housing prices were up 4% from last year. This is a much more “traditional” rate of increase which indicates that the efforts to curb inflation are working. During the pandemic, housing prices were up to 20% in this area, which affected housing affordability. This is a major observation in the market update for February 2023.

By the end of January, there were 1,349 homes sold. This is 26% decrease from last month and a 31% decrease from last year. Again, this is not surprising considering the lack of inventory of homes for sale.

The average number of days it took to sell a home is now at 37, up 6 days from last month and up 9 days from last year.

The median price per square foot per home is now $284, which is up 2% from last month and up 0.7% from last year.

The total value of homes sold amounted to $ 911,276,235. This is down 25% from last month and down 28% from this time last year. This rounds up the numbers for the latest market update for February 2023 for Northern Virginia.

What Agents are Seeing

Buyer demand in Northern Virginia is “Moderate” at best. The latest information from Bright MLS Home Demand Index lists areas and their overall demand from buyers using data such as showing requests an other Bright MLS metrics. In February, there areas with “Moderate” demand from buyers were Arlington and Alexandria; these were followed by “Steady” demand in Manassas City, Prince William County, and Stafford County. They noted that demand for the Greater Washington DC area (including Northern Virginia) was up 25% from January and 16% lower than this time last year.

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Month’s Supply

The month’s supply is rising steadily. From 1.2 last month to 1.6 this month. This number shows how many months it will take to sell all the current homes now on the market. Most consider a balanced market, where buyers and sellers of homes are on the same playing field, to be about 3-6 months supply. It illustrates how low inventory is at this time. Many experts speculate that this will keep home value to remain steady in Northern Virginia in the coming months.

Mortgage Interest Rates

According to Nerd Wallet, the annual percentage rate on 30-year conventional mortgages is at 6.771. This is up 21 basis points from the previous week and also up 274 basis points from last year. Many experts predict rates may continue going up (as high as 7 or 8%) and then begin goin down again, once the Federal Reserve is comfortable that inflation has come down. The main takeaway is that most experts agree rates will not return to 2-3% anytime soon.

Advice to Sellers

Advice to Buyers

Buyers who are discouraged by higher interest rates should keep in mind that rates are expected to get higher and it doesn’t mean you shouldn’t buy a home. If you can afford to buy a home, this may be a good time. Lenders can assist you with finding the best course of action for you – whether using a first time homebuyers program, buying down interest rate points, or using a “buydown” option. There will never be a time when you can get low rates AND low home prices. Since homeowners have about 40% more net worth than renters (according to the National Association of Realtors), it will be a good time to buy a home when you can afford it. Trying to “beat the market” shouldn’t be your tactic when it comes to your financial future.

Bottom Line

There is still a low inventory of homes for sale. Mortgage interest rates are hovering in the 6 percent rage and expected to go up before coming back down. Homebuyers are looking for their dream homes again and enjoying more to choose from and less competition. Thankfully, Northern Virginia is still a great place to live and own a home.

Questions/Concerns? Please contact me.

Also feel free to compare this update with last month’s Market Update – January 2023.

Blog • February 9, 2023

Is This a Good Time to Buy a Home?

by Denise Fuller

These are interesting times for everyone. Speculation about a recession, rise in mortgage interest rates, and low inventory of homes for sale are interesting indeed. And for the person thinking about buying a home, it becomes complicated. There are many factors that will indicate when it’s a good time to buy a home. It all boils down to your particular set of circumstances. So for you, is this a good time to buy a home?

MORTGAGE INTEREST RATES

At the end of 2022, mortgage interest rates rose sharply from under 3% to over 7% at the beginning of 2023. This caused rapid home sales as many buyers could no longer afford to buy a home. Those who didn’t qualify did not want to pay higher rates. According to this article by NerdWalet, “Rates could go up again if the Fed delivers more rate hikes in 2023. The Federal Open Market Committee will next meet Jan. 31-Feb. 1”. Still, most experts expect that rates will eventually go down to around 4% by the end of the year. “we can expect these rates to go back down if the Fed is successful in using them to lower inflation”, according to Forbes.

MORE NEGOTIATIONS

For someone thinking about it, 2023 may be a good time to buy a home. There is less competition than last year and the ability to keep property inspections and negotiate is present. This is a big change from last year when home sellers had multiple offers. This increased home prices dramatically and forced serious buyers to waive contingencies such as home inspections. Now, there is less of a chance of getting into bidding wars with several other interested buyers for the same house. This allows for negotiations and price adjustments. It helps that homes are taking longer to go under contract so buyers have time to see a home before it goes quickly under contract. Additionally, home prices have leveled off (for the meantime).

FUTURE OF HOME PRICES

The Federal Reserve is taking measures to curb inflation and bring down the cost of goods and services. Home prices are included. So far, home prices have leveled off. The expectation is that they will go down in certain areas. In Northern Virginia, home prices are still about 3% higher than they were last year but are going down month over month. It is possible that they will continue to decline in the coming months and this is a favorable position for buyers. There is a floor on how low prices will go, however. Since there are limited homes to buy, they are not expected to go down dramatically.

REFINANCING LATER

Many buyers active in this current market understand that they may be locking in higher mortgage interest rate but home prices are more reasonable. They can always look into home financing options such as first-time home buyer programs, buying down interest rate points, and 2-1 buydowns. Also, if mortgage rates do go down later in the year or next, they can refinance their mortgage at the lower rate.

LOW BUT INCREASING INVENTORY

The number of homes for sale is still in low supply while demand for homes remain high. Still, the Spring market is almost here and inventory is going up. This is great news for buyers who now have more of a selection and can possibly find their dream home and not have to compete with many buyers.

FIND MY HOME’S VALUE NOW

Bottom Line

Home inspections are a crucial component of the home selling process. Regardless of what happens, having an experience real estate specialist representing your interests is what you need.

Questions/Concerns? Please contact me.