Welcome! This blog tracks the real estate market in the Central Shenandoah Valley, featuring market data and analysis, an exploration of common buying and selling questions, and candid commentary on all things real estate.
If you are interested in discussing any of the topics on this blog, or the details of your specific real estate situation, call or e-mail me!
Buying
| Older Posts |
 |
 |
Homes Have Never Sold Faster Than They Are Selling Right Now! |
|
 OK, admittedly, I was only able to look back 20 years -- but still -- I think it is fair to say that... Homes Have Never Sold Faster Than They Are Selling Right Now! As you can see after the real estate boom of 2003 to 2006, the time it took for homes to sell (median days on market) got to be as high as four (plus) months and stayed there between 2008 and 2011. Since that time, homes have been selling faster and faster -- largely due to the demand for housing increasing steadily and the supply of homes declining steadily. In 2018, the median days on market dropped below one month -- and it has continued to decline in 2019 and 2020. The current "17 days" in 2020 means that half of the homes that sell in Harrisonburg and Rockingham County are under contract within 17 days of being listed for sale -- and the other half of the homes that sell take longer than 17 days. It is certainly a fast paced world we live in these days! Buyers have to be ready to move quickly when a new listing of interest hits the market! | |
 |
 |
|
|
Monthly Housing Costs Decline A Bit In 2020 Thanks To Record Low Mortgage Interest Rates |
|
 The monthly cost of a mortgage on a median priced house has actually declined a bit this year! For this analysis, I am measuring "monthly housing cost" by determining the mortgage payment amount (principal, interest, taxes and insurance) for a median priced home in Harrisonburg and Rockingham County, if a buyer were financing 80% of the purchase price and paying Harrisonburg real estate taxes. Over the past year...
So, even though prices are higher now than over the past two years, the monthly housing cost for financing 80% of the purchase of a median priced home has actually declined. | |
|
|
|
|
How Do Home Inspection Negotiations Usually Proceed? |
|
 A buyer agrees to pay a price for a house based on what they know about the house at that time. The home inspection process allows them to learn more about the house to confirm that it is the house that they thought. But sometimes, they discover problems with the house that they'd like the seller to address....
So, how do these home inspection negotiations usually proceed? The short (and vague) answer is -- well, it depends on the terms of your contract. But, overall, here is how the inspection process typically flows....  As you can see above, after a buyer requests repairs (based on the home inspection) the seller can choose to make some, all or none of the requested repairs. The transaction (and negotiations) can then go in a few different directions based on that response. Learn more about the home buying process at....  | |
|
|
|
|
Home Buyers Keep On Buying |
|
 You almost have to squint to see major differences between the trajectory of each of these lines over the past few years. The three lines above are showing the cumulative number of buyers signing contracts at any given point in the year. Looking back to the middle of March, just when we were starting to see effects of COVID-19 on our daily lives, the pace of contract activity in 2020 was ahead of the past two years... Jan 1, 2020 - Mar 15, 2020 = 265 contracts Jan 1, 2019 - Mar 15, 2019 = 242 contracts Thus, as of March 15, buyers were 9.5% ahead of last year's pace. Now, two thirds of the way through May, things have flipped flopped... Jan 1, 2020 - May 20, 2020 = 536 contracts Jan 1, 2019 - May 20, 2019 = 565 contracts Thus, as of May 20, buyers are 5% behind last year's pace. So... 1. Home buyer activity has slowed in 2020 over the past two months. 2. Home buying activity in 2020 is only 5% behind last year! I expect we'll see things start to speed back up at some point -- but it hasn't seemed to have started yet... | |
|
|
|
|
Mortgage Interest Rates Are Absurdly Low |
|
 Fortunate are the home buyers who happen to be buying right now -- and locking in super low mortgage interest rates! Over the past year, interest rates have been at an average of 3.62% -- but that has varied widely from being over 4% a year ago, to now being right around 3.25%. Rates have never (ever, ever, ever) been this low! If you are buying right now, you are fortunate to be locking in a very low mortgage interest rate, and it will likely never make sense to refinance! | |
|
|
|
|
Home Sales and Prices Still Rising Despite Declining Contract Activity |
|
 I just published my monthly market report, which you can download as a PDF here, or read on for the highlights of what is happening these days in our local housing market. But first, check out the details of the house shown above, located adjacent to the JMU campus, by visiting 80MaplehurstAvenue.com. Now, let's dive into the housing data and see what we can learn about the latest trends in the Harrisonburg real estate market...  As you can see above, the pace of home sales dropped off a good bit in April 2020 (see #1) as there were only 91 closed sales as compared to 112 last April. This is not altogether surprising, as we had seen contract activity starting to decline slightly in March. The year-to-date pace of sales (see #2) is actually still quite a bit higher (8.36%) this year as compared to last year. There was a surge of home sales in January 2020 which has kept us ahead of last year when it comes to year-to-date sales despite slower sales in April. The median sales price is still on the rise (see #3) over the past year -- having risen from $214,900 a year ago to $229,250 at the end of April. Homes are selling faster and faster and faster (see #4) with a 33% decline over the past year in the median days on market. And now, let's look at how sales have bounced all over the place thus far in 2020...  If you're feeling dizzy in 2020 trying to keep track of how the housing market is doing, you're not alone...
So, yeah - the net effect is still an increase between 2019 and 2020 - but that might shift when we include May home sales. We are likely to see fewer than 130 home sales in May based on contract activity in April. Only time will tell whether these short term interruptions of long term trends will impact those long term trends, as shown below...  As you can see (in green) the median sales price has been steadily rising over the past year (quite a bit longer actually) to the current median sales price of $229,250. So far, we're not seeing any indications that we'll see a flattening or decline in market values in this area. Over the past year, we have seen an increase (even if choppy) in the pace of home sales, but that dropped a bit in April 2020, and might drop a bit more in May 2020. I think this is mostly related to fewer sellers being willing to sell which is resulting in fewer buyers being able to buy. It's also helpful to look at values over time just for single family homes, as the townhouse/condo market often includes investors which doesn't show owner occupant buying activity as clearly...  The figures above are showing the median sales price of detached homes over the past six plus years. The median sales price has risen between 2% and 7% for each of the past five years, and seems to be ready to increase again in 2020, perhaps by around 3%. Part of the reason that prices are going up is because we're seeing steady buyer demand amidst fewer and fewer options of homes for sale at any given moment...  Above, we're looking at the number of buyers buying in a six month period -- which has been relatively steady over the past few years -- as compared to the number of homes on the market at any given time. The buyers are consistently ready to buy -- but they're fighting over fewer and fewer homes for sale. All that has made this an increasingly strong seller's market over the past few years. That said, buyer activity has faded a big over the past two months...  Last year, April was the strongest month of buyer activity for the entire year -- this year, not so much. We've seen an increase each month this year in the number of buyers buying -- but it has only resulted in a total of 440 contracts, as compared to a slightly higher pace of 466 contracts last year. So, slightly fewer buyers have contracted to buy in 2020, which will eventually result in a slower year-to-date sales figure, though that hasn't shown up yet. And why are fewer buyers buying, you might ask? I think the largest factor is fewer sellers being willing to sell...  As shown above, we have seen a 13% decline in the number of homes for sale over the past year. Last year, the number of homes for sale rose to around 270 homes and stayed around that number between March and October. This year, it is not clear that we'll see inventory levels get that high. Those buyers that are able to buy, though, are financing their home purchase at a historically low mortgage interest rate...  The mortgage interest rate at the end of April was 3.23%, which is the lowest on record -- ever. If you are buying in today's market, and are able to secure a contract on a house in this low inventory environment, you are certain to be pleased with your mortgage interest rate. OK, well, I'll leave it at that for now. You can review all of the trends and graphs by downloading a PDF of my market report here, or follow my blog at HarrisonburgHousingToday.com where I'll continue to monitor trends in our local market. In summary, the local housing market continues to see more homes selling, faster, at higher prices - but a small slow down in seller (and thus buyer) activity over the past two months will likely start to translate into slightly slower pace of sales, even if prices are not affected. Until next month, stay healthy, stay sane, and be in touch if I can be of any help to you or your family - with real estate or otherwise. | |
|
|
|
|
Mortgage Applications, Often A Good Leading Indicator Of Buyer Activity, Rising Quickly! |
|
 The number of people making applications for mortgages tends to be a good indicator of current and future buyer activity. The graph above shows that mortgage applications in 2020 were a good bit above 2019 through the middle of March and then they took a nose dive. That said, over the past two weeks, the rate of buyers making mortgage applications has started to rise quickly again -- and is nearing the same place it was a year ago at this time. Mortgage applications precede close sales by a month or two (or more) so this may be an early indicator that buyer activity is starting to stabilize and increase again. of note -- this is a national trend - locally, we did not see as much of a drop off in buyer activity in March and April as this graph would suggest. | |
|
|
|
|
Looking At The Big Picture, Financially, Of Both Selling AND Buying a House |
|
 If you will be selling your home to buy another, there are a lot of numbers floating around....
Above you will see a spreadsheet I put together to help you think about some of these numbers as you are evaluating if and when you will make a move to a new house. In yellow, are all of the inputs you will need to provide, or that you and I can determine together, such as your current payment, your home's current value, your mortgage payoff, whether you will be putting any additional money into the transaction, etc. In green, I have identified your potential future mortgage payment and the net change in your monthly payment. All of the numbers without a background color will automatically calculate for you. Click here to download this worksheet as an editable Excel file. | |
|
|
|
|
More Home Buyers Purchase In The County Than The City |
|
 Each year, right around twice as many home buyers purchase homes in Rockingham County as compared to in the City of Harrisonburg. That said, the home buyers in the City are much more densely situated -- since the City is comprised of only 17.42 square miles -- while the County spans 849.09 square miles! As a random aside, Rockingham County is the third largest county in Virginia! Not necessarily, as there are more than THREE as many homes for sale in the County as compared to the City.  Where will you purchase your next home? In the City or the County? Why? Based on the lot size, privacy, school district, age, property type? | |
|
|
|
|
Focus On The Big Items When Drafting A Repairs Request |
|
 After a home inspection, a buyer knows more about the house than when they agreed to pay $X to purchase the house. In order for them to still want to pay $X for the house, they may ask the seller to address some of the deficiencies found during the home inspection. Imagine a hypothetical scenario where the following deficiencies are found:
So - which items should the buyer ask the seller to repair? Some could say ALL of them - the buyer didn't agree to pay $X for the house with all of these large and small issues. But I'd advise most buyers to only request that the seller address a subset of those issues:
All of the other items (3-7) are minor issues that won't cost too much (in time or money) to repair after you buy the house. But why not ask the seller to repair these items?
| |
|
|
|
|
Always Look At The Larger Context When Considering House Price As A Buyer Or Seller |
|
 THE BUYER'S STATED PERSPECTIVE I know that your house is listed for $400K, but this one other home a few streets over sold for $350K last month, and it was a larger, so I'm not paying any more than $350K for your home. THE LARGER CONTEXT Just a few items...
Furthermore, aside from all of these differences in the two houses --- the other ($350K) house is not available any longer --- and there aren't three other houses just like it that the buyer can decide to buy. In this case, by focusing on this one not-actually-that-similar sale, the buyer has put themselves in a situation where they might miss out on purchasing a great home because of how they are viewing the market based on one comparable sale. THE SELLER'S STATED PERSPECTIVE I am confident that I can sell my house for $350K. After all, my friend owned a very similar house and he just sold it in a week, with multiple offers, for $360K! THE LARGER CONTEXT Just a few items...
Again, by focusing on this one not-actually-that-similar sale, the seller has put themselves in a situation where they might miss out on selling their home because of how they are viewing the market based on one comparable sale. The Main Takeaway As a buyer or as a seller -- don't focus on just one comparable sale when deciding on a reasonable price to pay or to ask -- look for the larger context! | |
|
|
|
|
Yes, House Showings Are Still Happening |
|
 Every home owner (house seller) likely feels a bit differently about whether house showings should happen and if so, how they should happen - but the majority of houses currently on the market can, indeed, be viewed by buyers. Below are recommendations for being considerate to home sellers... Prior to scheduling a tour:
During a property tour:
ALSO -- if it would makes you more comfortable, I can start by touring the house for you (taking precautionary steps as outlined above) and can take you along with me via FaceTime or Zoom. | |
|
|
|
|
City Homes Between $150K and $250K Are Selling FAST |
|
 Even in the midst of a pandemic, City homes between $150K and $250K are selling fast! I have experienced this several times lately either representing a seller or buyer, so I though I'd see if the data lined up with my experiences. It does. I took a look at all properties (attached or detached) between $150K and $250K that have gone under contract during the past 60 days in the City of Harrisonburg. There have been (24) such properties -- and they have gone under contract in a median of 3 DAYS. And of those 24 properties, 16 of them were under contract within a week! If you are selling a City property between $150K and $250K, you are likely to see plenty of buyer interest. If you are hoping to buy a City property between $150K and $250K, you had better be ready to act fast, and you are likely to have plenty of competition. | |
|
|
|
|
YTD Home Buying Activity Slows Slightly in 2020 |
|
 This is my first weekly check-in with contract activity where we're seeing a slight decline in contract activity in 2020 as compared to 2019. The data...
So, slightly fewer buyers have contracted on homes this year (to date) as compared to last year (to date). Is it significant? No, at least not at this point. There has been a 2.8% decline in buyer activity in 2020 -- which is a relatively small decline given how much of our daily lives has temporarily changed due to COVID-19. Happy Friday, and I'll check in on this metric again about a week from now. | |
|
|
|
|
Finding Townhouses For Sale In and Around Harrisonburg |
|
 It can be hard to find a townhouse for sale these days -- many of them are under contract within days or even hours of being listed for sale. So if you are a buyer looking to purchase a townhouse in or near Harrisonburg -- you should start thinking about the process sooner rather than later. Some first steps...
And here are a few resources you might find helpful...
Let me know if I can be of assistance to you as you start the search for the townhouse you hope to purchase in or around Harrisonburg. | |
|
|
|
|
Real Estate Closings In The Time of COVID19 |
|
 Prior to a month ago, lots of people would attend each real estate closing, such as:
But these days, it doesn't work so well to have a closing with 5 to 10 people present -- especially when a title company might have 8 to 12 closings per day. That title company would then potentially have 75+ people walking in and out of their office each day, in addition to the 10-ish people working in the office. So, things happen a little differently now... Basically, each party (buyer and seller) drives to the title company, picks up the closing documents from a box outside the front door of the title company, calls the closing attorney to review the documents by phone, and then signs the documents in their vehicle. Once the documents are signed, they are put back in the box and the closing attorney takes the documents into the office to review them and then let's the buyer or seller know that they can leave. This new process (utilized by multiple local title agencies) is still allowing real estate closings to happen, but it certainly is a tad bit less exciting than it used to be. There is (necessarily) quite a bit less personal interaction with this new process and some of the joy of a home purchase (or sale) isn't quite the same at that particular moment of the transaction. | |
|
|
|
|
I Think We Will See Fewer Houses Listed For Sale This Spring |
|
 It's spring! Flowers are blooming! The smell of new mulch is in the air! Many of us are battling with the onset of seasonal allergies! And we're seeing new listing after new listing hit the real estate market. Wait, what? Maybe not that last one. You see, it has officially been spring for a few weeks now, but we've also been dealing with the ongoing spread of a pandemic for a few weeks. What does that all mean for how many homes we'll see coming on the market this spring? I think we'll see fewer homes listed for sale given the current circumstances - though it will be hard to really measure that. We'll see fewer homes for sale than we would have if COVID-19 wasn't happening -- but we don't really know how many homes would have been listed for sale that now won't be listed for sale. So, in as much as we do experience a slightly-less-than-normal spring market...
It seems the local housing will make its way through all of this - but the timing of listings and the timing of sales will likely be a bit unusual this year! | |
|
|
|
|
This Is A Great Time To Explore Building Lots For Sale |
|
 If you're thinking about building a home, it's a great time to explore building lots for sale - simply because it is not an indoor space with regular inhabitants. I don't think the owner of the building lot will feel a need to wipe down the grass, underbrush or trees after you leave. Speaking of building, an age-old question is whether to buy a re-sale home or build a new home, especially as your price range gets above $400K or $500K. Typically, the tension between buying vs building is one of: 1. Goals 2. Money 3. Timing If you build, you can get the house you want, but you'll pay more for it and it will take a lot of time and attention. 1. Goals = Win 2. Money = Lose 3. Timing = Lose If you buy an existing home, you won't get exactly what you want, but you will pay less for the house and the process will not be a drain on your time. 1. Goals = Lose 2. Money = Win 3. Timing = Win Don't let my oversimplification of this issue fool you -- this is something that buyers can get stuck debating for months, or even years, often while looking at resale homes to try to convince themselves to buy instead building. If you are stuck in this quagmire, I'd be happy to meet with you (via Zoom?) to talk through some of the pros and cons and try to help you come to a decision you'll be pleased with in the short and long term. | |
|
|
|
|
Yes, Houses Are Still Being Listed For Sale |
|
 Some sellers are certainly waiting to put their house on the market given everything happening with COVID-19, but it seems that plenty of sellers are still listing their homes for sale...
When sellers are listing their homes for sale, they are often taking some extra precautions to keep their homes clean, such as...
So, if you are a seller thinking about listing your home for sale -- you won't be alone if you decide to go ahead and move forward with getting your house on the market -- but it is also understandable if you want to hold off for now. And if you're a buyer, in the current low inventory market, you should still be stalking the new listings to make sure you are not missing out on any opportunities. If you have any questions about buying and selling in this unusual, unprecedented time, feel free to touch base. Drop me a line at scott@hhtdy.com. | |
|
|
|
|
How Is Coronavirus Affecting How Many Buyers Are Buying Homes In Harrisonburg, Rockingham County? |
|
 Is Coronavirus slowing down home buyers in Harrisonburg and Rockingham County? It seems it may be, somewhat, but it's probably too early to make any definitive conclusions. Based on the graph above...
Here's another graph that shows looks at the cumulative number of home buyers who signed contracts through the entire year in 2018 and 2019, and thus far in 2020...  Above, you'll note that 2020 is still ahead of 2018 and 2019 when looking at the sum of January through March -- but that 2020 is drifting back downward towards 2018 and 2019. And, plenty disclaimers...
Anyhoo - lots of data, lots of possible conclusions, lots of caveats, and lots to continue to monitor over time. If you're thinking of buying or selling this Spring, let's chat about what makes sense from a timing perspective given continually changing market dynamics. | |
|
|
| Older Posts |
Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
Licensed in the
Commonwealth of Virginia
Home Search
Housing Market Report
Harrisonburg Townhouses
Walk Through This Home
Investment Properties
Heritage Estates
The Glen at Cross Keys
The Townes at Bluestone
Cottages @ Stone Spring
Founders Way
Harrisonburg New Homes
Harrisonburg Assessments
Best Deals In Harrisonburg
Harrisonburg Foreclosures
Bank Owned Properties
Potential Short Sales
Lease/Purchase Options
Owner Financing
Property Transfers
New Listings
Recent Price Changes
Luxury Homes
Secret MRIS Listings
Secret GAAR Listing
Broadway VA Homes
