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!
Opportunity
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What homes are NOT being built? |
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 The graph above is not based on any actual data -- it's based on my experience of our local market, and conversations with a variety of buyers over the past few years. It seems that most of what has been built as new housing stock in this area over the past 15 years has either been townhouses -- or high end homes. This has left quite a gap in the middle of the market, where there is a LOT of buyer demand, but where there is NOT a lot of new housing stock to help meet this demand. How and when will this change? What will these buyers buy if they can't buy a home in that middle of the market price range? | |
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Winter Is Often The Best Time For Purchasing Investment Properties |
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 Many of my savvy investor clients wait for these winter months to acquire additional rental properties. Their reasons are pretty logical....
Of note -- this advice is most applicable to townhouse properties that might be purchased by investors or owner occupants. This does not necessarily apply to multi-family properties or student housing properties. If you are looking for some advice on how to get started with real estate investing, check out HarrisonburgInvestmentProperties.com.
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Average 30 Year Mortgage Interest Rates Still Below Four Percent |
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 Mortgage interest rates are still below 4% -- after having spent November 2016 through May 2017 between 4% and 4.5%. Today's buyers are enjoying the opportunity to lock in their monthly housing costs at historically low rates. And -- let's look a bit further back -- at the past three years....  As you can see, above, mortgage interest rates have fluctuated between 3.5% (+/-) and 4.25% (+/-) over the past three years. If you were prequalified for a loan nine months ago (when rates were at 4.3%) you might want to request some updated potential payment scenarios from your lender with the current mortgage rates. | |
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The mid sized homes that ARE being built |
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 Last week I spent some time discussing the market need that I perceive for mid sized detached homes in or near the City of Harrisonburg. I went further, to suggest that these might be 1750 - 2150 SF homes for less than $300K. Thinking further about it over the weekend, I think it is important to note that there are actually SOME homes being built that meet these criteria. Below are the three homes that sold with these specs thus far in 2017....  1240 Cottage Lane (just outside Harrisonburg) 3 BR / 2.5 BA / 2336 SF / $275,230  246 Dylan Circle (Bridgewater) 4 BR / 2.5 BA / 1818 SF / $247,000 [no photo available] 395 Acme Company Street (Broadway) 3 BR / 2.5 BA / 2257 SF / $277,000 And if we relax the criteria a bit, down to 1600 SF, we pick up a few more....  365 Coyote Run (Broadway) 3 BR / 2 BA / 1600 SF / $$222,500  2587 Calico Drive (Broadway) 3 BR / 2.5 BA / 1639 SF / 5 Acres / $249,100  190 Grouse Drive (Massanutten) 3 BR / 2 BA / 1700 SF / $287,500 So, clearly, none in Harrisonburg proper, and most quite a ways from Harrisonburg -- and most importantly, VERY FEW homes at all that are being built and sold in this price range (under $300K) with these specs (1600+ or 1750+ SF). Switching, then, to what is currently available -- we find three options under $300K with 1750+ SF for buyers currently in the market....  265 Dylan Circle (Bridgewater) 4 BR / 2.5 BA / 1808 SF / $246,900  4150 Tanners Court (just outside Harrisonburg) 3 BR / 2 BA / 1830 SF / $279,900  1250 Cottage Lane (just outside Harrisonburg) 4 BR / 2.5 BA / 2266 SF / $299,400 So, indeed, extremely limited options for new homes under $300K with 1750+ square feet in or near Harrisonburg. This brings me back to my same conclusions as I mentioned last week, and I'll mention again here....
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We need mid sized detached homes, and lots of them, soon! |
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 Between 2000 and 2012, three centrally located townhouse developments were built in Harrisonburg:
Some of these townhomes were purchased by investors. Some were purchased by folks who have since sold and left the area. Some were purchased by folks who have since sold and bought a new, larger home, in or near Harrisonburg But I believe a lot of the original (or second) owners of these 614 townhouses are now looking around Harrisonburg wondering where they will, where they can go next. I believe our market desperately needs mid sized detached homes to be built, as these many townhouse owners are now older, often have started a family, and are looking for more space -- but can't jump up to buying a $350K to $400K home. What might these mid sized detached homes look like? Perhaps....
So -- who is going to build them? And where can the be built? In many conversations I have had lately, one of the main challenges is finding land that can be purchased at a price that will allow for the development and construction of this type of housing without making them $350K homes. | |
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Mountaintop Retreat with Cabin, Canyon, River, on 46 Acres in Craigsville, VA |
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 I have spent many a fun filled weekend in this cabin located just under an hour south of Harrisonburg off of Route 42, in Craigsville, VA -- and now you have the opportunity to form your cherished family memories on this amazing property. This mountaintop retreat features a recently built two bedroom cabin with a finished loft on 46 wooded acres with a trail through the property to a canyon and river, both also on the property! Enjoy hunting, fishing, hiking, bird watching, and much more in a peaceful setting within an hour of Harrisonburg and Charlottesville. This custom built cabin features a great room with vaulted ceiling, two bedrooms, a full bathroom, a large loft area, a covered porch, and features hardwood floors and beautiful wood trim and finishes throughout the home. Enjoy fishing in Little Calf Pasture River on the lower section of the 46 acre tract, accessible by hiking down the property, or by driving in on an access maintained by the home owners association.  Can you spot the cabin in the photo above? It is toward the top of the wooded area shown above. This 46 acre parcel is mostly wooded, and not all of it is shown in the photo above.  Fishing anyone? This river runs along the bottom of the property, and is accessible via a trail down from the cabin, or along a separate road that runs along the bottom of this property. A short walk from this river, you'll find a beautiful rock face forming a canyon wall of sorts.  Can you picture the fun times had in this cabin featuring two bedrooms, a full bathroom plus an upper level loft?  You'll find plenty of space for relaxing on the covered front porch of this cabin, complete with swing. Find out more about this amazing property at CraigsvilleRetreat.com. | |
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Should you buy or rent a townhouse in Harrisonburg? |
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 Given continued low interest rates and some increase in home values, let's take a new look at the opportunities of buying versus renting. RENT = $1050/m. There are regularly options for renting a two-story townhouse in Harrisonburg for approximately $1050 / month in Avalon Woods, Beacon Hill, Stonewall Heights, Liberty Square, etc. BUY = $1012/m. With a 95% loan, buying such a townhouse apparently may cost as little as $1,012 per month assuming a $155K purchase price and a 4% interest rate per SunTrust Mortgage's payment calculator....  This shows a rather small, $38/month, cost savings of buying instead of renting. If we then look at the difference between renting and buying over a five year time period, the advantages start to pile up.  As you can see, this builds a rather compelling case for buying instead of renting if you are going to be living in this potential townhouse for the next five years. Two other factors to keep in mind....
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Bank Owned Properties in Harrisonburg, VA |
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 While there aren't many foreclosure sales scheduled, and we have been seeing fewer foreclosures compared to home sales, there are still a good number of bank owned homes in the system for sale right now. You can always find the most current listing of bank owned homes online at HarrisonburgREO.com. Feel free to contact me if you have any questions about these properties. | |
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Fear Not, Mortgage Interest Rates Sticking Close to Four Percent |
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 Another month -- and still no meaningful changes in the 30 year mortgage interest rate. Since the beginning of the year, these rates have slowly edged downward, and have now been below four percent for most of the past three months. This continues to provide a great opportunity for home buyers -- likely spurring on continued buyer interest in our local market. As I commented to someone last week, I have been thinking mortgage interest rates were going to start increasing for at least five years now -- and I have been wrong for at least five years now. Will they ever increase? Possibly. When? How? By how much? It's anyone's guess at this point. I think there is probably a 75% chance (maybe a 90% chance?) we'll finish out this year at or below 4.5% -- which is hard to believe. | |
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Four Bedroom Home on 1.65 Acres Offers Views, Privacy in Fort Defiance |
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  You can't necessarily buy a recently built four bedroom house on 1+ acres for around $350K in Rockingham County -- but just a few minutes further south, in Augusta County, you can! This expansive home located at 134 Bailey Road with a two attached car garage on a 1.65 acre lot offers long views in a private setting. Enjoy upscale features such as hardwood floors, maple cabinets, granite countertops and ceramic tile in the bathrooms. The main level offers an office, formal dining room, living room, kitchen with breakfast nook plus a main level guest bedroom and full bathroom. Upstairs you will find a spacious master suite, and three additional rooms plus an unfinished bonus room for storage. Don't miss the covered front porch, two-story foyer, crown moulding, chair rail, large linen closet and much more! Visit 134BaileyRoad.com to find:
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30 Year Mortgage Interest Rates Comfortably Below Four Percent |
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 Anyone who thought mortgage interest rates were above 4% for good -- and perhaps climbing up to 4.5% or 5% -- seems to have been WRONG! I certainly thought we were headed for 4.5% or 5% -- but over the past three months, 30 year mortgage interest rates have continued to slowly decline to their current level of 3.88%. Yet again, a great opportunity to lock in your monthly housing costs over the long term at one of the lowest possible monthly cost per dollar spent, given these tremendously low mortgage interest rates! | |
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Unique Opportunity in Preston Lake |
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 As shown above, this rowhouse in Preston Lake offers an AMAZING rooftop terrace -- and it will be hard to leave once you are up there, enjoying the space....   Care to check out this compelling property in person? Just drop me an email at scott@HarrisonburgHousingToday.com.. | |
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Mortgage Interest Rates Stay Reasonable at 4 Percent |
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 OK, so, admittedly, mortgage interest rates were compellingly low last year -- at around 3.5% for much of the year. However, at their current levels of 4%, that is still very (VERY) low historically speaking. Buyers still have a great opportunity to lock in their monthly housing costs for the long term at what will likely be some of the lowest interest rates we see over the next few (several? many?) years! If you're looking for a qualified, professional, responsive local lender, let me know. | |
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Limited Building Lots Remain in Heritage Estates, Active Adult Community in Harrisonburg, VA |
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 Only nine building lots remain in Heritage Estates, an active adult (55+) community in the western edge of Harrisonburg, Virginia. With low maintenance French Country style architecture, and single family homes with partial basements starting below $400K, this community has been a popular destination for many buyers both from Harrisonburg and retiring to the Shenandoah Valley. Click here to view a higher resolution version of the aerial image above, or email me to set up a time to meet with the developer/builder at Heritage Estates, Jerry Scripture. | |
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Looking Closer at Investing |
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 Yesterday, I was commenting on the market demand for well maintained rental properties for non-students in the City of Harrisonburg. I had pitched these general assumptions... Purchase Price: $150,000I had several follow up questions from you all yesterday, so I thought I'd provide a slightly more detailed view of this theoretical investment.... This analysis shows a much fuller analysis of the potential investment, including these assumptions:
In the first year, this investment would potentially result in....
Over the first five years, this would potentially result in....
Let me know if you have questions about any or all of this, as each investor and investment scenario will look a bit different. All that said, I believe there is a reasonable opportunity for a solid return when buying an investment property in Harrisonburg -- and I'd be happy to help you with that process if you are interested. | |
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Attention investors, rentals are scarce, can you help out? |
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 The townhouse shown above recently became available for rent -- and within days there were 30+ inquiries, multiple applications, and the tenants have already moved in. There is a significant shortage of well maintained rental properties for non-students in the City of Harrisonburg. So, investors, anyone want to step up to the plate and purchase some properties to turn around and rent? Now, admittedly, the return on such a property is not as favorable as you might find with a student rental, or a multi-family property, but the numbers still work. For example.... Purchase Price: $150,000 Down Payment: 20% ($30,000) Interest Rate on 30 year Mortgage: 4.5% Monthly Payment: $740 (principal, interest, taxes, insurance) Rental Income: $1050 Property Management: -$105 Association Dues: -$50 Mortgage Payment: -$740 Net Cash Flow: +$155 So -- if you're interested in buying a townhouse or two to help with this rental shortage -- and to benefit yourself financially, let me know. | |
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Lock Your Mortgage Interest Rate NOW |
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 What??? Average mortgage interest rates (on a 30 year fixed rate mortgage) are back below 4% again. I truly did not think we'd see that this year -- or possibly ever. It seemed likely we'd stay between 4% and 4.5% or even up to 5% during 2017. Anyhow -- if you're in the market to buy, and have a contract signed on a house you are purchasing -- LOCK IN YOUR INTEREST RATE! Of note -- if you can swing it to finance your mortgage over 15 years instead of over 30 years, you'll be even happier at 3.23%! | |
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Support Downtown Harrisonburg AND Fund Your House Down Payment? |
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 Get this -- you can support Downtown Harrisonburg AND have the opportunity to win funds to use as your down payment on a house! :) Harrisonburg Downtown Renaissance has launched FRIENDLY CITY FORTUNE -- a large scale raffle with $250,000 of prizes to be given away on July 4, 2017. Prices include thousands of dollars of cash (including a $3K winner, $5K winner, $10K winner and $30K winner!!) and a 2017 Ford F-150 4x4! Tickets are $100 -- 5000 of them will be sold -- and all raffle proceeds will support the vitality of downtown Harrisonburg through important redevelopment, beautification and community-building initiatives. Learn more about the Friendly City Fortune here, or buy your raffle ticket here. | |
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This (winter) could be the optimal time to buy an investment property |
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 OK -- admittedly, it doesn't feel like winter out this week, or in may recent weeks, however, I'll still take this time to note that many of my savvy investor clients wait for these winter/winter-ish months to acquire additional rental properties. Their reasons are pretty logical....
Of note -- this advice is most applicable to townhouse properties that might be purchased by investors or owner occupants. This does not necessarily apply to multi-family properties or student housing properties. If you are looking for some advice on how to get started with real estate investing, check out HarrisonburgInvestmentProperties.com.
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Only Select Few Building Lot Remain at Heritage Estates |
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 Dawn at Heritage Estates, December 2016 Only a select few building lots remain at Heritage Estates, an active adult (55+) community located on the West side of Harrisonburg on Garbers Church Road. Heritage Estates boasts superb French Country architecture with flowing interior floor plans that are wonderful for entertaining. You'll also enjoy spectacular views of the Blue Ridge Mountains, the golf course immediately beside Heritage Estates, the community swimming pool, and a maintenance-free lifestyle.  Check out the remaining building lots here -- each grouping offering a slightly different vantage point on the community, the pool, the mountains, etc. For more information on Heritage Estates, visit HeritageEstates.us or email me to set up a time to meet at the model home. | |
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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
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Commonwealth of Virginia
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