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!
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What To Expect For The Second Half Of The Year In Our Local Real Estate Market |
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 I spent some time this past weekend cleaning up my crystal ball - oh wait, no, I was cleaning my garage. My crystal ball is always ready and waiting to convincingly and accurately predict the future of our local real estate market. Or something like that... But really -- here are several of my predictions for the second half of 2020... MORE HOME SALES - The pace of contract signing (the earliest indicator of market activity) lagged behind (2020 vs. 2019) for quite a few months this year but has now broken through last year's trajectory and we're seeing more cumulative contracts signed in 2020 as compared to 2019. So, it doesn't seem that COVID-19 will end up resulting in a net decline in home sales in our local area. HIGHER SALES PRICES - Even as contract activity lagged behind in 2020, the median sales prices of those homes that were selling kept on climbing. We are not seeing any indicators on the horizon at this point that would seem to cause home prices to flatten out our decline. CONTINUED LOW MORTGAGE INTEREST RATES - I certainly didn't think we'd keep hitting new low after new low for mortgage interest rates in 2020, but indeed, that has been the case. The average 30 year fixed rate mortgage interest rate is 3.07% as of the moment I am typing this. Wow! I certainly don't expect them to be any lower than this, but I think they'll likely stay below 4% for the rest of the calendar year. SPEEDY SALES - Homes are selling faster and faster and faster. The "median" days on market has declined 37% over the past year from 24 days to 15 days. So, buyers have to be ready to jump on new listings quickly. LOW INVENTORY LEVELS - There were some times over the past few months when I thought we might start seeing inventory levels creeping up -- because sellers would unexpectedly need to sell, or because buyers weren't able to or interested in buying -- but neither of those happened. I suspect we will keep seeing very low inventory levels throughout the remainder of the year. OK - in the end - my predictions don't point to anything particularly surprising or unexpected - but perhaps that is the main take away. I don't think we are going to see anything drastically unexpected or surprising in our local housing market in the 3rd and 4th quarter of this year. | |
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Contracts Shoot Skyward In June, Sort Of Like Fireworks |
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 After three months in a row (March, April, May) of slow contract activity (compared to last year) the pace of contracts being signed shot skyward in June to easily eclipse last June, as well as March, April and May of both years! This is a good indicator that we are not likely to see much of an impact on our local real estate market based on COVID, other than that it affected the timing of when these sales (contracts) were coming together. Contracts came together much later than usual this year. Happy Independence Day! | |
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Which Terms Are Usually Most Important To Home Sellers When Receiving Multiple Offers? |
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 It's all about money, right? Well - not always. If you are making an offer on a house and you will be competing with other buyers who are also making offers, there is more to think about than just the price you are offering to pay. Some of these terms will be outside of your control, but keep in mind that these contract terms are ones that a seller will likely be comparing when they have multiple offers... PRICE - Certainly, if some offers are higher than others on price, they are more likely to be accepted by the seller. This can be accomplished by making a strong initial offer -- or by making an offer with an escalation that would increase your offer if other competing offers are higher than your initial offer. CLOSING COSTS - Don't ask for the seller to pay for them if you can avoid it. A $250K offer asking the seller to pay $5K is not equivalent to a $245K offer without a closing cost credit - even though they have the same net to the seller. The $250K offer requires the house to appraise for $250K, whereas the $245K offer only requires it to appraise for $245K. DOWN PAYMENT - The larger your down payment is, the more likely the seller is to consider your offer if comparing it to other offers with buyers making a smaller down payment. A larger down payment shows that you are potentially more financially capable or stable than other buyers who need to finance a greater portion of the purchase price. DEPOSIT - The amount of your deposit ($500, $1000, $2000, $5000) doesn't make a huge difference to the seller (it usually goes back to the buyer if a contract contingency doesn't work out) but a larger deposit shows greater financial capability. LENDER LETTER - This one should be obvious, but make sure to include a letter from your lender showing you are qualified to purchase the home at the price you are offering to pay. PERSONAL PROPERTY - If the seller only wants to include the kitchen appliances with the house, don't potentially miss out on buying the house because you're asking for the clothes washer, clothes dryer, lawn mower, porch swing and pet hamster. ;-) CLOSING DATE - Take a moment and ask the seller what closing date would be most convenient for them, and then work with that if you can. In the absent of that knowledge, offer a speedy closing date but verbally confirm that you can be flexible on timing. HOME INSPECTION - If you are comfortable buying without a home inspection, don't add the contingency. If you do decide to conduct a home inspection (most buyers do) then consider taking the "I did the inspection and I'm walking away from the deal without even asking for any repairs" off the table. This is one of the standard clauses in the home inspection contingency, and if you are willing to remove that clause -- basically showing a willingness to make a good faith effort to negotiate any inspection findings -- it will be noticed and appreciated by most sellers. Also, if you can go ahead and get a home inspection scheduled within 10 days, then offer a shorter inspection contingency timeframe (such as 12 day) instead of the 18 to 21 days we typically see in offers these days based on limited availability of inspectors. FRIENDLY LETTER - Consider writing a cover letter to introduce yourself to the seller and explain who you are and why you are excited to buy their particular home. If there are multiple offers with similar terms but only one buyer took the time to provide some personal context, that could go a long way towards helping the sellers gravitate towards their offer. These items above are just a few of the terms that a seller will likely be comparing when they receive multiple offers on their home. Price is certainly one of the most important factors, but oftentimes the prices of multiple offers are relatively similar -- and the seller will be looking for other ways that an individual offer stands out from the other competing offers. Best of luck, home buyers, in this fast and furious seller's market! | |
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Detached Homes Under $250K In The City of Harrisonburg Are A Hot Commodity |
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 If you are selling a detached home in the City of Harrisonburg, priced under $250K, you are likely to have quite a few early showings. If your home is prepared well and priced well, it would not be uncommon to have 10+ showings on the first day that it hits the market. A few tips for such home sellers...
Happy home selling if your home is priced under $250K in the City. It will likely be a whirlwind of early activity! | |
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Rockingham County Approves Stormwater Fee for Properties In Lake Shenandoah Watershed |
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 If you live in (or own property in) the area shown above, you'll have a new tax to pay come December 2020 - a fee that will go towards funding upgrades in the stormwater infrastructure in the Lake Shenandoah Watershed.
These fees should bring in approximately $2.8 million over the next ten years - though the total estimated costs for the needed infrastructure improvements are between $3.15 million and $4.75 million. Also in their June meeting, the Lake Shenandoah Storm water Control Authority Board (made up of the same members as the Rockingham County Board of Supervisors)
If you live in this area, hopefully the news of this new tax isn't a surprise to you -- as it has been discussed for about a year now. The County held the first public hearing on this matter back in July 2019. Learn more about the Lake Shenandoah Stormwater Control Authority here. | |
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Pace of 2020 Buyer Activity Recovers During June |
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 Remember where we were back at the beginning of June? Home buyer activity was lagging behind in Harrisonburg and Rockingham County -- with 2020 buyer activity (ratified contracts) down 5.44% as compared to 2019. Not any longer! As of the end of last week, there have been 1.11% more contracts signed in 2020 as compared to 2019. So - the Spring was slower and stranger than usual, but it appears that 2020 may turn out to be an even stronger year than 2019 for home buyer activity in our local area. | |
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How To Make An Offer On Your Dream House |
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 How, you might ask, do we go about getting from the point of wanting to make an offer --- to actually making the offer? Here's a brief overview....
When we get to step seven, above, we will be discussing and deciding on the terms of the offer. Below is a list of the main contract terms we will need to discuss in preparing to make an offer.
Before and after making an offer, there is a lot more to know about and think about regarding the home purchasing process. Read more at....  Keep up with new listings at ...  | |
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New Home Communities Boost Listing Inventory, Contract Activity, Closed Sales |
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 Inventory levels have been low and getting lower for the past few years - but several new home communities have launched during that time that have provide more options for buyers in our local market. Here are details of four communities that have started up in the past year...  Island Ford Estates - view current listings Duplexes in McGaheysville off Island Ford Road currently priced between $327,900 and $329,900. 2 For Sale, 2 Under Contract, 0 Sold  Crescent Ridge - view current listings Townhouses near the intersection of Taylor Spring Lane and Massanetta Springs Road currently priced between $244,900 and $249,900. 3 For Sale, 14 Under Contract, 7 Sold  Eastwood - view current listings Townhouses on Boyers Road backing up to Sentara RMH Medical Center currently priced between $189,900 and $196,500. 0 For Sale, 19 Under Contract, 2 Sold  South Peak - view current listings Duplexes in McGaheysville currently priced between $251,870 and $293,975. 3 For Sale, 11 Under Contract, 0 Sold | |
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Virginia Housing Market Not As Vulnerable As Most |
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 The National Association of Home Builders recently took a look at which states' housing markets were more (and less) vulnerable for a downturn brought on by the COVID-19 pandemic. The states that are the most vulnerable are those with "state economies heavily reliant on leisure, entertainment, retail and personal services". So, basically, the jobs that folks have in Virginia tend to be less vulnerable to a downturn brought on by COVID-19 than in most other states across the country. Read more about it here. | |
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Boom, Just Like That, 2020 Buying Activity Is On Par With 2019 Trend |
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 Buyer activity has been lagging this year -- in fact just a few weeks ago there were 5.5% fewer contracts signed in 2020 as compared to 2019. But, not any longer! As of the end of the day yesterday (June 18) the pace of buying activity in 2020 is right back on track with 2019. OK, fine, less one home. Jan 1, 2019 - Jun 18, 2019 Contracts = 695 Jan 1, 2020 - Jun 18, 2020 Contracts = 694 It seems that COVID-19 might have even less of an impact on overall market activity than I had thought. Stay tuned to see if 2020 will cross over to surpass 2019 in the coming weeks. | |
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Everybody Refinancing Their Homes Seems To Be Slowing Down The Purchase Mortgage Market |
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 Depending on the details (rate, term, etc.) of your current mortgage it might be a great time to refinance your mortgage. Interest rates are at RECORD low levels. And...apparently, a LOT of folks have figured this out as the refinance market seems to be BOOMING right now. Loan officers are busy as can be, some appraisers are finding that it takes them longer to fulfill appraisal requests, closings are being delayed. So, if you're doing something as straightforward as buying a home, and needing to get a mortgage - be forewarned that the financing part of the home buying process might take a bit longer than you'd like or expect. Appraisals might take longer to get back to the lender. It might take a few extra days for appraisals to be reviewed by underwriters. The underwriters might need a few extra days to review your file and get you to loan approval. And on, and on. My best advice is to work with a local lender (just ask, I have recommendations) and then follow up with them regularly to make sure things are still progressing as planned and that you are on track for an on time closing. | |
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Having Difficulty Finding Homes Under $200K? Here Is Why! |
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 The blue line shown above is showing you the change in the number of homes for sale under $200K in Harrisonburg and Rockingham County. As you can see, this segment of our housing market has offered fewer and fewer choices at any given time over the past few years. Some further explanation and caveats...
So, if you are having difficulty finding a home to buy under $200K, maybe now you can see why you are having this experience! Be ready to pounce on any new listing of interest and you better already have a pre-approval letter in hand from your lender! | |
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Local Home Prices Still Rising Despite Slightly Fewer Home Sales |
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 Happy Monday Morning! We're nearly halfway through the year now, and it has been a year like no other when it comes to our local real estate market and in so many other ways. Read on for an overview of our local housing market, or click here to download a 28-page PDF with all of the latest local housing market trends. But before we dive into the data, take a few minutes to check out this custom-built cedar log home on 2.81 acres one mile from Sentara RMH by visiting 3193TaylorSpringLane.com. Now, on to the data...  So much to point out here as this has been anything but a "normal" year...
OK - that was a lot of words to absorb - let's get to more visuals and fewer words. Relax and sip your coffee as you scroll through the following trends - knowing you'll be smarter, even if a bit more confused, by the time you get to the bottom of this overview...  This has been a year of bests and worsts! Home sales were on fire in January and March (best months ever) and were dreadfully slow in February, April and May (worst months ever) - leaving no clear indication of whether we should be extraordinarily excited or depressed about 2020. Maybe we are experiencing this same dichotomy as we think about other aspects of 2020 as well!? :-) But when viewing these bests and worsts piled on top of each other...  The positive impact of the strong months (Jan/Mar) have almost entirely made up for drag of the slow months (Feb/Apr/May) bringing our year-to-date total of home sales up to 479 -- only slightly behind where we were a year ago. But even if those year-to-date numbers are rosy, the most recent two months of slower sales do impact the longer-term trajectory...  We can get excited about the top graph above -- in green -- as the median sales price is definitely still on the rise. The bottom graph (above, in orange) does show that the annual pace of buyer activity is starting to decline based on slower than normal sales in April and May. We may yet see this bounce back up depending on how June and July and August go, so stay tuned... And speaking of how future sales will go -- we ought to take a look at contract activity...  Contract activity is (clearly) a leading indicator for closed sales. Above you'll note that March and April of 2020 (116, 120) were much slower than last year (132,158) but we did see an increase in May contract activity. If we continue to see another increase in contract activity in June, then perhaps the surge of contracts being signed will just have been later in 2020 than in most other years. And if you're wondering why contract activity has been lower than usual, here is one reason for it...  Inventory levels (the number of homes on the market for sale at any given point in time) continue to decline. As such, buyers are finding fewer (and fewer) options of homes to buy. This has been a steady trend (lower inventory levels) over the past few years and the fact that inventory levels are still dropping tells me that slower sales is a result of fewer sellers selling more than a result of fewer buyers buying. The speed at which homes sell also reinforces that conclusion...  As shown above, two out of three homes are under contract within one month of hitting the market for sale. Beyond that, the median days on market for all homes that have sold in the past year -- was 15 days! So, there are fewer homes for sale at any given time, and homes are selling more quickly than ever -- indicating that buyers are still out there ready to buy -- we just need some sellers ready and willing to sell! And finally, some big picture economic indicators that are great and awful...  We are experiencing the lowest mortgage interest rates -- ever! Several of my buyer clients have locked in 30 year fixed mortgage interest rates below 3% (paying a point) but even without paying a point, the average rate at the end of May was only 3.15%! Yet at the same time, the unemployment rate (which had been trending lower and lower and lower) shot up from 2 point something up to 10.8% in April. This is likely at least somewhat temporary - and seems to affect folks renting homes more than those buying homes - but it is still not a great indicator of the health of our local economy. I'll be following this trajectory close over the next few months. OK - that brings your Monday morning snapshot of our local housing market to a close. And yes, I'll forgive you if you didn't get around to reading this until some other time than Monday morning. A few quick out takeaways...
If you're thinking about buying soon, or selling soon, let me know if you'd like to chat more specifically about your situation and goals. I'd be happy to help you with our potential purchase or sale. You can reach me most easily at scott@HarrisonburgHousingToday.com or by calling/texting me at 540-578-0102. Have a great week! | |
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Gap In 2020 Home Buyer Activity Starting To Close? |
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 Welcome to June! It seems that the pace of home buying activity might (??) be starting to pick back up again during June...
Give it a few more weeks to know for sure, but it seems that slightly more buying (and selling) is happening as we have started rolling through June. | |
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Sometimes A Full Price Offer Just Is Not Enough! |
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 It has happened to several of my clients lately -- we have made a full price offer with reasonable contingencies (home inspection, radon test, appraisal, financing) and we have lost out on the house. What does it, or might it, mean?
So, unfortunately, on a well priced new listing in a competitive price range -- seeing the house on the day it is listed and making a full price offer that same day won't necessarily mean you will be buying the house. As such, it's a great time to be a seller. It's not necessarily as exciting to be a buyer right now. | |
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Rockingham County Launches New GIS (Geographic Information System) |
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 Rockingham County has launched a new GIS (Geographic Information System) and it's pretty fun. Check it out here... Below are a few features I've discovered so far, and I'm sure there are even more interesting ways to use it to understand properties in Rockingham County. The aerial imagery is now from 2019 (instead of 2018) showing more recent development more accurately...  You can turn on the Lake Shenandoah Stormwater Control Authority to see if a property falls within this newly defined area with a new planned tax for addressing stormwater issues in this area...  You can turn on 10 foot contour lines to better understand the lay of the land, so to speak, and to see how quickly the elevation of a parcel is changing...  You can turn on a zoning layer to quickly understand how different parcels are zoned in any particular part of the County...  There is even a "land cover" layer that can give you a sense of whether parcels are covered with grass, trees, etc.  Check it all out at the link below and let me know of any further cool features you discover... | |
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Harrisonburg Area Home Sales Slow In May |
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 A bit later this week I'll take a full look at our local housing market and publish my full market report. Before I get to that, though, I thought I'd take a quick peek at the pace of sales in May. As you can see above...
Stay tuned for further analysis of our local housing market, but yes, home sales did slow down quite a bit in May. | |
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How To Plan Your Move If You Are Both Buying and Selling A Home |
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 Moving from one house to another is tough work! Even tougher (sometimes) is arranging the timing and logistics to work well for all parties. If you're selling a house in order to buy a house, it's possible that...
The spot for you to be can be somewhat easier -- you could stay at a hotel or with a friend for a night if needed. It's decidedly harder to put all of your belongings in the hotel room or in your friend's house. The options, generally speaking, are...
If none of these are possibilities -- I have even had some clients who had to put everything in storage, just for a few days -- and then move it out of storage into the new house. Again - even moving is tremendously hard - but arranging for it within the tight confines of closing timelines and when you do and do not have access to the old house and new house can make it even more difficult! | |
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At Start of Phase Two the Pace of 2020 Contract Signing Is Still Slowing |
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 Welcome to Phase 2 in Virginia, folks! :-) Here's a quick summary of what is changing...
So, how about it, home sellers -- are you ready to put your homes on the market? I am confident we'll have very few 50+ person showings... ;-) As shown above, the pace of home buying (contract signing) has slowed over the past month.
I have theorized for a few weeks now that this slow down in buyer activity is a result of fewer sellers being ready to sell as opposed to fewer buyers being willing or able to buy. If that is the case, will this new phase mean more sellers will sell and thus more buyers will buy and thus that we'll see the 2020 trajectory start to catch back up with 2019? Maybe. We'll wait and watch and see together. Happy Friday! | |
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High End Home Sales (Incredibly) Strong In 2019 |
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 High end home sales (over $600K per this analysis) have been quite strong over the past five years. To put it into context...
Also of interest is if we look at an even higher price point...  The graph above shows home sales over $750K and as is evident, we usually see only 1 or 2 home sales per year in this price range -- but in 2015 that surged to 8 home sales, and last year it surged again, up to 10 home sales! I suppose it is also important to note that these price ranges are a small portion of our local housing market. In 2019...
Thus far in 2020, this high end segment of the market (over $600K) seems to be performing similarly to 2019 -- though the $750K+ market seems to be returning to normal level after an extraordinarily strong 2019. | |
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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
Licensed in the
Commonwealth of Virginia
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