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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Can Home Buyers Keep Up The Pace in April 2017? |
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 Last year (2016) was a startlingly strong year in the residential real estate market in Harrisonburg and Rockingham County -- and thus far, 2017 seems as if it will hold its own. The graph above shows the number of contracts signed per month over the past three months of 2017 (orange) -- and how that compares to the pace of contract signing in 2016. As you can see, despite a slightly slow start in January, both February and March of this year showed MORE contracts being signed than the year below. How, then, are we doing thus far in April??? Could we possibly see a jump all the way up to 158 contracts signed??? Here's what we can see so far.... April 1 - 18, 2016 = 91 contracts April 1 - 18, 2017 = 92 contracts ! ! ! So, yes, it seems April might continue on the strong streak of home sales in 2017! | |
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City of Harrisonburg Proposes 9% Increase in Real Estate Tax Rate |
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 The City of Harrisonburg has published their proposed 2017-18 budget, which includes a proposed increase in the real estate tax rate from $0.78 per $100 of assessed value to $0.85. This would mark a 9% increase in the real estate tax rate in one year, and a 35% increase over a four year period. A budget summary follows, or you can find the entire proposed budget here.  | |
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Is a balanced market always this fleeting? |
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 The graph shown above is an illustration of changing inventory levels (blue line) and the number of buyers buying in a six month period (orange line). The point at which the two lines meet is when there was exactly six months of inventory of homes on the market for sale. All of the months prior to when the lines met are times when (to varying degrees) there were many more homes on the market (housing surplus) than there were buyers to buy them (low demand). All of the months after the point when the lines met are times when (to varying degrees) there have been far fewer homes on the market (housing shortage) than there are buyers to buy them (high demand). Perhaps what has surprised me the most in the past year is how quickly the balance seems to be swinging towards a seller's market (low supply, high demand) when I thought we might stay in a relatively balanced market (high supply, high demand or moderate supply, moderate demand) for some time. | |
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Rockingham County Likely to Increase Real Estate Tax Rate by Four Cents |
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 Rockingham County's budget for the 2018 fiscal year (which begins July 1) includes a proposed $0.04 increase in the real estate tax rate, which would increase from $0.70 to $0.74 per $100 of assessed value. Some context....
Read lots more about WHY the tax rate needs to increase here.... County Eyes More Taxes, Fees | |
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Half As Many Options for Buyers Under $200K |
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 Housing inventory levels are declining in Harrisonburg and Rockingham County, but perhaps none so precipitously as the under $200K market. As shown above, there are HALF as many homes for sale under $200K now as compared to one year ago. This leaves many buyers in this price range in a difficult spot of trying to find a home to purchase that will fit their needs. I believe some of this is related to a lack of new construction of homes in this price range. Read more about our local housing market at HarrisonburgHousingMarket.com. | |
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Strong Home Buying (Contract Signing) Activity in March 2017 |
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 This beautiful home is 2930 Brookstone Drive - check it out here! Wow! March was a wild and crazy month in the real estate world in Harrisonburg and Rockingham County. Let's put it this way -- in the past three years, there have only been three months when more buyers have signed contracts than in March 2017! But I'm getting ahead of myself -- read on.... As you'd guess from the header image above, I have published my monthly market report, which you can download as a PDF, or read online. For the abridged version of the most important things for you to know, read on.... First -- for those that would rather listen/watch than read -- tune in to my monthly video overview of our local housing market....  And now, some general indicators of market performance....  Some basic notes from this general market overview:
As shown above, each month of 2017 (so far!) has barely surpassed the same month of the previous year. That said, we may be about to see a significant change in that trend because....
As shown above, homes were flying off the shelf (buyers were signing contracts) faster (slightly) than I can eat donuts from Peace, Love and Little Donuts. No joking, though, as noted above, the 140 signed contracts in March 2017 exceeds all but three months from the past three years. So -- it seems likely that we'll see a pop in April 2017 home sales! With all of these homes selling, are we running out of homes for folks to buy?
Why yes, we are! There has been a 30% decline in the number of homes for sale over the past year. And -- get this -- if we look solely at homes under $200K, there has been a 50% decline in housing inventory levels! OK -- so, more homes are selling, at higher prices, more quickly -- sounds good for sellers, right? Yes, but I would still remind all sellers that even in a seller's market it is still essential to focus on price, condition and marketing. And what is a buyer to do in some crazy times as these? Be prepared! Know the market, know the process, know your buying power, and monitor new listings closely! If you're interested in even more market data, read my full online market report, download the PDF, or click here to sign up to receive my real estate blog by email. Here are two handy references to prepare yourself to buy or sell a home.... | |
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Balancing RISK and REWARD when purchasing a rental property for your JMU student |
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 If you are looking to purchase a rental property for your JMU student to live in while they are a student at JMU, there are two basic paths you could go down.... Option 1 -- A property in a traditional student housing neighborhood. These will allow the most students to live in the property and will maximize the rental income per dollar spent on the purchase. However, it will also expose you to a more turbulent segment of the market, as rental rates and sales prices of these properties can vary quite a bit over time as the supply of competing student housing ebbs and flows based on large complexes being built by student housing developers. You can find purchase options in this category here. Option 2 -- A townhouse in a community that has many owner occupants, some non-student renters and some student renters. Many of these will not allow as many un-related students to live in the property (per zoning regulation or restrictive covenant) and will not provide quite as much rental income per dollar spent on the purchase price. However, they will be in segment of the real estate market that is much more predictable and less volatile from a rental rate and/or sales price perspective. You can find purchase options in this category here and here. I work with parents of JMU students each year who go down each path outlined above, each for different reasons. Most of the time, though, it boils down to their tolerance for risk or their desire for reward. It can also be related to their intended time horizon for owning the property. If you are interested in buying a rental property for your son or daughter to live in while they are at student at JMU, let me know. | |
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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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Shenandoah Valley SING OFF, an a capella contest, to be held this Saturday! |
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 Don't miss the inaugural Shenandoah Valley SING OFF, this Saturday, at Harrisonburg High School, featuring the following groups....
Shenandoah Valley SING OFF April 8, 2017 @ 7:00 PM @ Harrisonburg High School 1001 Garbers Church Road, Harrisonburg, VA 22801 Buy Tickets Online Here | |
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Mortgage Interest Rates Drop (a bit) to Close Out March 2017 |
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 Mortgage interest rates ticked back downwards a bit yesterday to finish out the month of March at 4.14%. If we can keep going through 2017 between 4% and 4.25%, I'd be delighted -- though I suspect we'll end up in the 4.5% - 4.75% range. All that said, despite not being sub-4%, interest rates should not necessarily be drastically changing buying behavior. | |
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The process for making an offer, when you are ready |
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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....  | |
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The layout, floor plan, flow of the house is often the MOST important aspect for buyers |
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 If a buyer is buying over $400K, or even over $300K, the layout of the home becomes very important to them. That is not to say that it is unimportant for a $200K buyer -- but someone buying a more expensive home oftentimes plans to stay in it for a longer time frame. If not the #1 feedback, the #2 feedback I receive from showings of homes priced over $400K is that the layout just didn't work for the buyers. They wanted another bedroom here, instead of there. They wanted a more open floor plan. They wanted a more formal dining room. They wanted a more spacious basement. Challengingly, the layout is something that is hard (nearly impossible) for a seller to change in order to appeal to a wider segment of buyers. Thus, if your home has a layout that continues to not work for buyer after buyer, you must either wait (and potentially wait and wait and wait) for the buyer who loves that layout -- or adjust the list price to make the house (even with its layout) more appealing to more buyers. | |
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Strong Home Buyer Activity Continues in March 2017 |
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 Buyers were at it again in March 2017 -- with a 10% increase in buyer activity in the first 26 days of March as compared to the same timeframe a year ago. Look for a strong month of closings in April based on these strong March contract figures! | |
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All market indicators are positive for home sellers |
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 Sellers are certainly enjoying themselves these days. Perhaps because it wasn't too many years ago that sellers were having a difficult time selling their homes. My oh my how the tables have turned. PRICES ARE UP - this is good for sellers, as they are likely to sell their home for more than they would have a year or so ago. INVENTORY IS DOWN - this is good for sellers, as they have fewer homes to compete against in the current market. DEMAND IS UP - this is good for sellers, as there are more buyers potentially interested in buying their home as compared to a year ago. TIME ON MARKET IS DOWN - this is good for sellers, as they are likely to sell their home more quickly than they would have a year ago. | |
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If you will be both selling and then buying, how will your mortgage payment change? |
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 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. | |
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Insight into the Special Use Request Process in the City of Harrisonburg |
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 The R-2 zoning classification was amended on December 15, 1998 to only allow up to two unrelated people in an R-2 zoned property. Prior to that time, up to four unrelated people could have lived in the property. All that said, if an R-2 zoned property was being inhabited by four unrelated people prior to that zoning change (12/15/1998) and has been ever since that time, without a 24 month gap, then it can continue to be used in that way. Otherwise, if you own an R-2 zoned property, even if it has four bedrooms, even if it is close to the JMU campus, even if everybody else on the street rents their house out to four unrelated students, you cannot per the zoning ordinances. Below is an excerpt of an article from the Daily News Record that discusses one property owner's request to the City to allow him to use an R-2 zoned property as a rental property for more than two unrelated people. I think his request was reasonable, in some ways, based on the use of neighboring properties, but read on to discover what the City thought and what they decided. Council Kills Special-Use Permit Request Click here to read the entire article. | |
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Be Careful With Your Words. The Seller Might Be Listening! |
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 As a buyer, when you are walking through a home, keep in mind that the seller might be listening. These days, there are plenty of ways that a seller could be monitoring their home, with a security camera, or other recording device that could allow them to hear every word you are saying while you are in their house. So..... 1. Don't insult their house. It won't help during negotiations.By the way, sellers, it may not be legal for you to record conversations in your home while you are gone. You should likely either NOT record conversations, or disclose that it is taking place. P.S. I am not an attorney. Consult one if you want an actual legal opinion. Ask me if you need a recommendation. | |
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Must a seller agree to make repairs after the home inspection? |
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 Nope! What follows is an astute comment from Bob after my recent post on home inspections.... Scott, sometimes the impression is left (by the agents in some cases, but more likely just by the sellers hearing anecdotes) that the seller is somehow obligated to repair any deficiencies found by the home inspector. My mother was told she would HAVE to repair this, that, or the other thing, as if it were some kind of law that the house you sell has to be in "like new" condition. If the agent who is representing the seller lets someone put language in the contract obligating the seller to anything other than another potential round of negotiations after the inspection, then they have failed their fiduciary responsibility to their client. Likewise, they should be educating their clients that the contract is not completed until the buyer has the information to make a wise decision about the purchase, and when the amendments come in for the seller to fix stuff, they have a powerful, one-word tool they can use to protect themselves. The word "no".Bob is, indeed, correct -- the standard home inspection contingencies used in this area (I can't speak for other areas) do not place any obligations on the seller to make any repairs. A buyer makes a decision to buy a home based on the information available to them at the time that they make the offer. They then will often conduct a home inspection to learn more about the condition of the property. If they discover material defects, they can (reasonably) ask the seller to address those detects --- BUT --- the seller does not have to agree! Now, of course, if there are some major issues revealed during the home inspection, and the buyer requests that the seller address them, and the seller uses Bob's powerful one-word tool of saying "no" -- then the buyer, of course, can decide not to proceed with the purchase. But the point here is that nothing in the home inspection process requires a seller to make any repairs. | |
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Just how low are housing inventory levels right now? |
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 Low, low, super low! I talk with some regularity about how low inventory levels are right now This is not just a seasonal thing. Inventory levels don't get this low every year at this time and then rise again in the Spring and Summer. In fact, as shown above, for the past there years at this time there have always been between 539 and 550 homes for sale -- that is a pretty consistent track record. This year, however, there are only 405 homes for sale -- marking a 25% decline in the number of homes for sale. it gets worse by price range, by the way. There are 44% fewer homes on the market in the "under $200K" price range right now as compared to a year ago. | |
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This 409 SF house was 3D printed in 24 hours for $10K |
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 Will you print your next home? I suppose it might depend on where you live and how large of a house you decide to buy or build. A Russian company constructed (printed) a 409 SF home in December 2016 in a 24 hour timeframe, apparently at a cost of only around $10K. The home was built with a mobile 3D printer which started by printing the walls and then was removed to allow manual workers to come in to finish the home. Read more here or watch a video here. | |
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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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