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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!
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Thus far this year, 60% of all home sales have been under $200K......and 90% of all home sales have been under $325K in Harrisonburg and Rockingham County.
As you may have read about in the news, home values (nationally) are increasing....
As shown in the chart at the top, we have only seen a 0.2% annual increase in prices in Harrisonburg and Rockingham County.
Review a full battery of local housing market trends here.
HarrisonburgTownhouses.com has been updated with sales data from 2013-Q2, and many townhouse communities are (finally) starting to see median prices increase again.
So, are you wondering about property values in your townhouse community? Or considering purchasing an investment property? Whatever the reason for your interest in townhouses in Harrisonburg, you will likely find the information you need at HarrisonburgTownhouses.com, including (for each townhouse community):
The townhouse communities featured on HarrisonburgTownhouses.com include:
It seems quite possible --- see above.
But remember folks, these are still ridiculously low interest rates from a historical perspective.
Last year was the worst year in the last 10 years to try to sell a home for more than $600K in Harrisonburg and Rockingham County. This year is shaping up quite nicely. It may not be a blockbuster (10+ or 12+) year, but it won't be nearly as bad as last year.
Looking for that perfect $600K+ home? Don't miss this one: photos | web site
Interest rates are increasing. It's not the end of the world, but buying soon will likely be more affordable than buying later.....
The payments shown above only reflect principal and interest, not taxes and insurance.
Interest rates have increased from 3.35% to 3.98% over the past six weeks. A 30 year fixed mortgage interest rate below 4% is still fantastic (even below 5% is great) but if you're buying soon, you should consider finalizing those details ASAP to try to get a 3.something% interest rate if you can.
I have been tracking contract activity over over six years and I have never seen contract levels this high in a single month. Over the past six years, we never saw any more than 121 contracts signed in a single month. Last month, there were an astonishing 143 contracts signed!
If the first 28 days of May are any indication, our local housing market will be setting new records this month. There have already been 125 contracts signed on residential real estate listings in Harrisonburg and Rockingham County this month. That is nearly double the pace of contract signing seen in previous months of May.
As stated yesterday, even though sales are up, prices are not yet increasing.
So what can we expect of home prices over the next five years?
I believe we will start to see an increase in prices this year (perhaps 1%) and then we may see a more ambitious (2% - 3%) increase for the next few years after that.
Bear in mind that depending on the timeframe you examine (see the bottom of this post) the median home value increases around 5% per year.
The matrix above shows that a $250K home would (potentially) increase to a value of $289K over the next five years if we see an average of 3% appreciation per year over the next five years.
Click here to download the table above as an Excel file to plug in your own variables.
National median home values increased 5.94% per year between 1960 and 2000.
National median home values increased 6.72% per year between 1970 and 2000.
National median home values increased 4.76% per year between 1980 and 2000.
As several of you pointed out, last week's sales and inventory graph was missing the trendline for price. So, here (above) is the updated graph. As you can see, over the past two years we have seen prices stabilize as sales increased and inventory decreased. All good signs for further stability and growth in our local housing market!
The Harrisonburg / Rockingham unemployment rate dropped below 5% for the first time in 50 months in March. This is a good sign for our local economy, and also speaks to trends being seen across the state and country as well.
Downtown Harrisonburg has seen some major growth over the past eight years and there are exciting projects on the horizon. Perhaps that's why Downtown Harrisonburg was recently featured in the national publication pictured above, Main Street Now. In fact, the magazine actually features a lengthy case study highlighting the successes in downtown Harrisonburg, with quotes from Eddie Bumbaugh, Barry Kelley, Andrew Forward and John Sallah....
Click here to download the Jan/Feb 2013 issue of Main Street Now to read the full story about how Downtown Harrisonburg has been transformed in recent years.
There are fewer and fewer homes for sale under $200K (shown above) but there are more and more buyers (see below).
These crossing trends (fewer sellers, more buyers) helps to balance the under-$200K segment of our local market, and since many of those sellers will move up to $200K-$300K sales, it can slowly, positively impact the remainder of our market as well.
As shown above, we are currently experiencing the lowest inventory levels we have seen anytime in the past six years.
Let me know if you would like an analysis of competing inventory for your particular home.
I believe there are still a lower than normal number of people buying in our housing market. Take a look at the graph above which tracks population growth over the past 12 years as compared to the number of single family home buyers in any given year. If we assume that a normal percentage of all residents bought in 2000, we are still seeing a smaller than normal percentage of residents buying as of last year.
Some might even argue that we should mark the start of the normal trend line somewhere between the number of 2000 buyers and 2001 buyers. If so, then the current market has even further to grow before approaching a historically normal number of buyers per year, as shown below....
As shown in the graph above, the median sales price for homes in Harrisonburg and Rockingham County has been stable (between $173K and $177K) for 23 months now. Each of these data points shows the median sales price for a 12 month period, so they are solid, long-term trends.
Also shown above, our local market has seen a relatively steady increase in the pace of home sales for 20 months now. Each of these data points shows the total number of home sales during the most recent 12 month period, so again, these are solid long-term indicators.
Bottom line? While individual homes, neighborhoods or price ranges might still see some price adjustments, I do not believe we will see any further (overall) price declines in Harrisonburg and Rockingham County.
Read more in my most recent monthly housing market report.
Lest I be accused of only talking about mortgage interest rates when they are falling....
As you'll see above, interest rates have generally been on the rise since the beginning of the year. After staying below 3.5% between September 2012 and January 2013, they have now edged back up.
These mortgage interest rates are, of course, still unbelievably low -- both over the long-term (the past year's rates are the lowest ever) --- as well as in the short term (rates are 0.5% lower than a year ago).
If you are considering a home purchase this spring or summer, now might be an excellent time to become pre-approved, find a house and lock in an ultra-low mortgage interest rate!
After five years of declining sales (2005-2010) the pace of single family home sales finally increased in 2011.
After five years of declining sales prices (2006-2011) the median price of single family homes (sold) finally increased in 2012.
At this point, I'm not expecting either of those to start declining again over the next few years (even if they don't increase exponentially either) -- so, if you were waiting for the bottom of the market, this is (or was) it.
Buyers -- act early in 2013 before prices continue to increase through 2013.
Sellers -- be realistic about pricing, to best present your house to potential buyers.
I'm expecting to see further recovery in both pace of sales and price of sales during 2013.
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