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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Local Home Sales, and Prices, Soar in June 2018 |
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 Learn more about this fantastic home in Massanutten Resort: 127FortRoad.com. I just published my most recent monthly market report, and as usual, you can read on for an overview, download the full report as a PDF, read the entire report with commentary online, or tune in to my monthly video overview of our local housing market...  OK -- now, let's take a look at some of the overall market indicators this month...  As shown above...
 Wow! Just wow! The 165 sales seen in June 2018 is the highest seen any time in the past several years -- in fact -- it is the most sales in a single month any time in the past 10 years! I actually have data back to 2003, and the only times that we have seen more than 165 home sales in a single month have been: June 2004 (174), June 2005 (173), July 2005 (166), August 2005 (183) and June 2006 (192).  Needless to say, this is the fastest start to the year we have seen anytime in recent history. As shown above, the 639 home sales in the first half of 2018 exceeds the number seen in the first half of the past three years. Looking back further, the only times we saw more home sales in the first half of the year were in 2004 (706), 2005 (764) and 2006 (759).  As shown above, despite slowing sales over the past year-ish, median sales prices have been slowly rising -- and over the past three months have started escalating quickly -- from $200K to $210K between March 2018 and June 2018. So -- record numbers of sales, quickly rising prices -- hmmm -- something about this seems familiar. Should we be worried? Maybe, or maybe not...  The figures shown in all prior charts and graphs has been for all residential sales -- including detached homes, duplexes, townhouses and condominiums. The graph immediately above focuses only on Single Family (detached) Homes and this can often give us the truest indicator of market trends. Perhaps it is (or could be) some comfort, then, that the median sales price of these detached homes has only risen 2.4% over the past year. This may mean that the rapid increases in prices we are seeing has more to do with what is selling (property type, price range) and/or is being skewed by non-owner occupied home sales/purchases.  It is also important to note that while the number of home sales has been dropping slowly (3% decline comparing past 12 months to prior 12 months) part of that may be due to a change in market balance. It is a strong seller's market now, as there are a roughly equivalent number of buyers in the market as compared to a year ago -- with a drastically lower number of sellers in the market.  And here, folks, is the reason why we saw so many home sales this month -- it was a result of the crazy number of contracts signed last month. Last month's 171 contracts was the highest number I have seen anytime since I have been tracking these figures. Thus, slightly slower contracts in June is to be expected -- and we are likely to still see a strong month of sales in July based on some May contracts rolling over into July closings.  And here it is again -- declining inventory levels. While inventory levels have seen a seasonal increase over the past six months, there has been a net year-over-year decline of 12% in the number of homes on the market. Fewer homes for sale, with a roughly equivalent number of home buyers, has lead to a strong seller's market -- and a frustrating time for many buyers!  Perhaps because there are so many buyers fighting over each listing, homes are selling more quickly. Half of the homes that have sold in the past year have been under contract within 30 days of having been listed for sale. Again, this is not half of all properties that are listed going under contract in 30 days -- just half of those that actually do sell.  As shown above, mortgage interest rates have been increasing over the past year -- almost an entire percentage point. This has not seemed to have made a drastic difference in the pace of buyer activity (yet) and it has been nice to see these edge downward somewhat over the past few months. OK -- I'll stop there for now. Again, you can download the full report as a PDF, read the entire report with commentary online, or tune in to my monthly video overview of our local housing market One last note for anyone thinking of buying or selling soon -- SELLERS -- even though it is a seller's market in many price ranges right now, you must still focus on price, condition and marketing. For further reading on buying or selling in this area, check out.... | |
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Lots (and lots) of High End Apartments Being Built |
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 In addition to the 168 apartments about to be built at the intersection of Stone Spring Road and East Market Street (near Preston Lake) -- there are already hundreds now complete at The Reserve at Stoneport. Per my earlier research, it seems this community may contain 408 apartments, with rental rates from $1000 - $1800. How many high end apartments are needed in this area? While only a few years ago no high end apartments existed in our local market, now I believe Stoneport is already nearly entirely leased. How much unmet demand is there for these apartments? Apartment developers don't seem to have met the demand yet. Oh, and also of note in the aerial image above, it seems Dupont Community Credit Union put some solar panels on the roof of their new bank. Nice!  | |
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College Student Housing Under Construction on Port Republic Road |
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 If you've driven on Port Republic Road lately, near Bojangles, you might have noticed construction starting to peek over the top of Port Republic Road. Above is an photo of the construction progress. And here are some images of the planned 425-bed college student housing community...    | |
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Land for New High School Was To Be Student Housing, then Convocation Center |
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 Have you heard Harrisonburg needs a second high school? The current (only) high school in the City is beyond capacity. As such, the City has been evaluated various pieces of land to find a suitable new site for the new high school -- and now they have made a decision. Background... Owners of median priced City homes might have to pay $26 more per month to fund new City high school So, back to the location... The parcel of land shown above is 60 acres located between South Main Street (Route 11) and Interstate 81. The City intends to purchase this land for five million dollars from JMU. But JMU has actually owned it for a few years. You see, this land was actually originally slated to be used for college student housing! More background... So... the land was originally going to house 466 apartments for college students...  And then it was to be the site of JMU's new convocation center...  And now, the site of Harrisonburg's second high school. Read today's Daily News Record article for further context... | |
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Grading Under Way For For High End Apartments, Gas Station |
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 view high resolution photo here If you have drive by the intersection of Route 33 East and Stone Spring Road anytime recently you have likely seen the mass grading that is under way. In the photo above:
Flipping the view around to the other direction -- below is my understanding of the intended use of the space....  download a larger version of this photo here My understanding of this intended usage of this land is based on the Preston Lake master plan as shown below, updated as of December 2016....  The area that is currently being graded will include the area shown below surrounded by a dashed line. This will include 168 apartments in 12 buildings, as well as a clubhouse and pool.  Part of the land being graded in the aerial photo at the top of this post is intended to be used for future commercial development. Read more about the ownership of the land, and the apartments here. | |
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New Convocation Center Under Construction at JMU |
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 view a larger image here Curious about all of the dirt moving on the JMU Campus on University Boulevard across from Costco and Cinnamon Bear Bakery & Deli? A new convocation center is being built at JMU. Check out some beautiful renderings of this new facility here. The new Convocation Center will be the home of the men's and women's basketball programs along with university graduations and other large gatherings and on campus events. This facility will cost $88 million -- $12 million dollars of which is being raised from private supporters. | |
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Should You Buy A Home Warranty When You Purchase A Home? |
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 Click here to download the full information packet on home warranties from American Home Shield -- or read on for more details.... What is a Home Warranty? It's a one-year service agreement that covers the repair or replacement of many major home system components and appliances that typically breakdown over time due to normal wear and tear. Homeowners Insurance and a Home Warranty - What's the Difference? You sensibly protect your house with homeowners insurance. While homeowners insurance covers many appliances and system components in the event of a disaster (such as a fire), having an AHS® Home Warranty will cover those items against the high costs of repair or replacement in the event a breakdown occurs. Who is AHS? The leader in home warranties, AHS was founded in 1971 to help homeowners across the country protect their hard-earned investments. Recognized with the 2013 Best in Service Award from HomeWarrantyReviews.com and the 2014 Women's Choice Award, our customer service is well-respected, with professional agents ready 24/7 to accept your service requests.  AHS Home Warranty Packages There are three AHS Home Warranty packages available during the real estate transaction, making it easy for you to get exactly the coverage you need, at a price you can afford. ShieldEssentialSMAHS offers the same high level of coverage across all three packages, such as repairs and replacements for mismatched systems, undetectable pre-existing conditions, improper installations, lack of maintenance, rust and corrosion, and more.  Click here to download the full information packet on home warranties from American Home Shield. | |
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Now That You Are Ready To Make An Offer On A Home, Where Do We Start? |
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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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How Many Current Homes For Sale Will Actually Be Interesting To YOU? |
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 If you are entering the market to buy a home, the number of homes you will have to choose from will vary widely based on what you are looking for in a new home. Some buyers have a very narrow scope and find themselves on a prolonged hunt for what seems to be an elusive or mythical home. Some buyers find plenty of options, evaluate quite a few, make a decision and move forward with an offer. However -- keep in mind that as you consider the 344-ish homes currently on the market for sale, that some of them have been on the market for 3 months, 6 months, 9 months or even longer. The freshest of fresh listings are those that have come on in the past 30 days -- which (this time of year) is less than 100 of the 344-ish homes currently listed for sale. Depending on your time frame for buying, and the narrowness of your scope, sometimes it makes sense to quickly evaluate the current options -- and then to wait and see what new and exciting listings will be coming on the market in coming days and weeks. Steps to get started include talking to a lender to get a sense of your target price range, and then chatting with me (in person, by email, by phone) so that I can also be keeping an eye out for suitable properties for you. Learn more about the home buying process at... Keep up with new listings at ... | |
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How Many Home Sellers Pay Closing Costs For Buyers? |
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 Almost half of sellers (43.3%) pay some portion of a buyer's closing costs in the form of a credit at closing. Over the past five years, the number of sellers providing a "concession" of this sort to buyers have stayed between 40% and 50%.  Of interest -- sellers have paid more and more of a buyer's closing costs over the past five years, but that has edged back down during 2018. Why would sellers be paying more of a buyer's closing costs? It's hard to say exactly -- buyers might be asking for more money, sellers might be agreeing to provide a larger credit, or perhaps the total amount of closing costs that a buyer has to pay is increasing as well?  If, as a seller, you are paying part of a buyer's closing costs, you are most likely to be paying between $4K and $6K --- or between $2K and $4K. And again, as a seller, if you pay part of the buyer's closing costs -- you are not alone -- 43% or so of sellers do so! | |
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179 Building Lots For Sale in Harrisonburg, Rockingham County |
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 Where will you build your new home? There are 179 building lots for sale in Harrisonburg and Rockingham priced under $200K. The list below shows the subdivision / location of the lots. If you're interested in further details about any of these lots or locations, let me know! As an aside -- how does 179 strike you? It was more building lots that I thought I'd find when a client asked about this. Of note -- these are lots where "public water" and "public sewer" are available -- there are countless other lots where you would need to drill a well and install a septic system.  | |
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Renting vs Buying a Townhouse in Harrisonburg |
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 Given continued relatively 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 = $1104/m. With a 95% loan, buying such a townhouse apparently may cost as little/muchas $1,272 per month assuming a $160K purchase price and a 4.7% interest rate per SunTrust Mortgage's payment calculator. So -- at first glace, it would seem to be about $54/month more expensive to buy a townhouse as compared to renting one right now. That said, if we then look at the difference between renting and buying over a five year time period, we start to see a bigger picture... Total Rental Payments over 5 Years = $63,000 Total Mortgage Payments over 5 Years = $66,240 Principal Reduction of Mortgage over 5 Years = $13,025 Effective Total Housing Payments over 5 Years = $53,215 Savings over 5 Years = $9,785 As you can see, this builds a somewhat compelling case for buying instead of renting if you are going to be living in this potential townhouse for the next five years. A few other factors to keep in mind....
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Only Four New Homes Remain at The Glen at Cross Keys |
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 Construction is moving along steadily at The Glen at Cross Keys -- with 74 out of 78 homes now sold or under contract. Most of the recent builds have been the Sycamore and Paired Sycamore model that feature an open first floor plan with a two story great room. Click on the image below to view a photo set from a recent Sycamore home at The Glen at Cross Keys.  Click here to view available homes at The Glen at Cross Keys. | |
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What Does It Mean If Your Home Is Being Shown But Has No Offers? |
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 As a home seller, you will face rejection left and right -- many prospective buyers will come view your house and most of them will decide not to buy it. But how, as a seller, do you make sense of that feedback? I often hear the following types of feedback after a showing:
This type of feedback (size, location, floor plan) is difficult to do much with as a seller. You likely aren't going to build an addition to your house, nor will you physically move the house, nor will you reconfigure the floor plan. Sometimes the feedback is just a mild objection to be overcome -- did you realize that the unfinished bonus room could be finished quite inexpensively (size) and that the new South East connector will make your commute quite short (location)? Oftentimes, however, if you receive feedback about size, location or floor plan there isn't much you can do about it as a seller. I also, however, will hear the following types of feedback after a showing:
This type of feedback (price, condition, marketing) is completely in your control as a seller. Many buyers will not make an offer if they think your list price is too far from reality -- adjusting your pricing may be just what you need to either generate more showings, or have a chance of the showings turning into offers. I almost included AGE as a factor outside of a seller's control, but it's much more about condition -- how well has a property been maintained, and is it in top showing shape so that buyers don't feel overwhelmed by short-term cosmetic updates and long-term maintenance needs? Finally, if a house has not been marketed thoroughly and effectively, it will likely have a much longer "days on market" than other properties, worrying buyers that perhaps they shouldn't buy the home because nobody else has in the last ten months. Read more about, think more about, and learn more about selling your house at SellingAHomeInHarrisonburg.com. | |
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Monthly Housing Costs On The Rise |
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 It should come as no surprise that monthly housing costs are increasing, after all...
Thus, the 22% increase in monthly housing costs over the past three years should not be too surprising. 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. Looking forward, I would expect that all three of these factors (prices, interest rates, tax rates) that influence housing costs would likely continue to increase. | |
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When To Get Serious About A Mortgage For Your Home Purchase |
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 Here are the three sequences I see buyers follow most frequently....
As Late As Possible
Incredibly Proactive
A Reasonable Middle Ground
I try to encourage all of my clients to at least be in the "reasonable middle ground" sequence as outlined above. This gives them a firm idea of what they can afford and how a home price will compare to a loan payment. This also allows them to make a stronger offer, already having a pre-qualification letter in hand. I strongly discourage my clients from following the "as late as possible" sequence as outlined above. This doesn't help them make the best decisions about which houses to pursue, how far to negotiate, etc. This also doesn't allow us to make as strong of an offer on a house. Occasionally, one of my clients will fall into the "incredible proactive" sequence as outlined above, and wow, this makes the financing process a joy to work through! These buyers have already done so much of their work with the lender before even thinking about which house to buy -- which then allows them to focus on buying, negotiating, inspecting, etc., rather than be bogged down in the process of securing their mortgage. Let me know if you have questions about how I have described these sequences -- and let me know if you would like a few recommendations for lenders in the Harrisonburg area. | |
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Just How Fast Are Home Selling These Days? |
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 "Days on Market" is the number of days that pass before a property is under contract. Thus, if a home is on the market for 10 days before a contract is signed, the "days on market" will be 10 for that property. The "Median Days On Market" for any given time frame gives us a good sense of how quickly homes are selling. For example, the median of 28 days for the first five months of 2018 means that half of the homes that sold in the first five months of 2018 were under contract less than 28 days after they hit the market -- and half took more than 28 days to go under contract. It is important to note that this does NOT mean that half of homes that are LISTED are under contract within 28 days -- just that half of those that actually SOLD were under contract within 28 days. The trend line here is rather remarkable. Just six years ago (2012) the median days on market was right around 3.5 months -- and now the median is just under one month! Read more about our local housing market in the most recent edition of my monthly market report...  | |
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More Buyers Signed Contracts in May 2018 Than In Any Other Month, Ever |
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 To say that May 2018 was a busy month for contract signing seems to be an understatement. I have data all the way back to April 2007 -- and the number of contracts signed last month (171) seems to be the highest month of contract activity we have ever seen in Harrisonburg and Rockingham County. It's hard to say how those contracts will show up as closings -- they will likely spread out between June and July -- so we might not have the highest month of home sales ever in June 2018. But, then again, we might. :-) Read more about our local housing market in the most recent edition of my monthly market report... | |
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Home Sales Slow, Prices Pop, Contracts Climb |
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Find out about this beautiful home at Preston Lake: 3168PrestonLakeBoulevard.com. I just published my most recent monthly market report, and as usual, you can read on for an overview, download the full report as a PDF, read the entire report with commentary online, or tune in to my monthly video overview of our local housing market...  OK -- now, let's take a look at some of the basic market indicators this month...  Plenty of statistics of interest above, including...
 So, as seen above, May sales were slower than (I) expected. After the best February, March and April in recent memory -- home sales in May 2018 fell below both May 2017 and May 2016. What gives? Well, perhaps, it is just some month-to-month variation between years. Keep reading to find out why all is not lost when it comes to late-Spring and early-Summer home sales. :-)  Looking at a slightly longer timeframe, the pace of home sales in the first five months of this year is only lagging slightly behind where we were last year -- and thus putting us in second place for the pace of home sales in Harrisonburg and Rockingham County.  Have you heard it's a seller's market? There are fewer and fewer sellers (keep reading for details) and this has buyers fighting over properties in some price ranges (and locations) -- which has resulted in sellers needing to negotiate a bit less on their price than in years past. The median ratio between the sales price and list price is now 99%, as compared to 97% - 98% over the past five years.  Yep -- this is the crazy one! Last May we saw 133 homes go under contract -- this May there were 171!?! I'll have to check my historical archives to be sure, but I think this may be the MOST contracts we have EVER seen in a single month EVER. Wow. So -- even if we were despairing that home sales were slowing in May -- perhaps we can excitedly look forward to June (and July) when these May contracts start turning into closed sales. Again -- wow!  And yes, as mentioned above, inventory levels are falling -- fewer and fewer homes are on the market available to a buyer on any given day. We have seen a 42% decline in inventory levels over the past two years -- and a 12% decline in the past 12 months. The decline is slowing -- which might mean this inventory level can only go so low -- but this is what is causing so much frustration for buyers -- and oftentimes, so much delight for sellers! :-)  Faster and faster and faster, oh my! Indeed, homes are selling even more quickly now than they were a year ago. Half of the homes that sold in the past year were under contract within 30 days of hitting the market. If you are a buyer -- be ready to act FAST!  And finally, interest rates are on the rise. :-/ It costs more to finance a home purchase now than it did a year ago. I commented to a client today that today's interest rates are still ridiculously low compared to any longer-term historical perspective, but he was quick (and wise) to point out that this fact doesn't necessarily matter much for today's buyers. Why are they going to appreciate that today's interest rates are lower than they have been for most of the past 20 years -- all they care about is that they are going to be paying more to finance their home purchase now than if they had bought six months of a year ago. OK -- I'll stop there for now. Again, you can download the full report as a PDF, read the entire report with commentary online, or keep reading my blog in the coming days for further commentary. One last note for anyone thinking of buying or selling soon -- SELLERS -- even though it is a seller's market in many price ranges right now, you must still focus on price, condition and marketing. For further reading on buying or selling in this area, check out.... | |
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Can All Homes In Harrisonburg Be Rented To Groups of JMU Students? |
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 With great regularity, potential buyers (either investors or parents of JMU students) will ask if a single family home can be purchased and rented to a group of JMU students -- often an intended group of four or more students.
I let them know that it will be no problem at all -- the adjoining property owners in the quaint neighborhood probably won't mind as long as the students aren't too bothersome -- and the City doesn't mind at all if their zoning ordinances are violated, so long as it's just "nice college kids".... WAIT! NOT REALLY! READ ON!!!! It seems that some buyers are really getting that feedback of "sure, it will be fine" -- though I'm not sure if they're getting it from their Realtor, or from someone else advising them in the transaction, or if they just aren't thinking about whether their planned use of a property is allowable. The REAL answer, and the feedback that I ACTUALLY provide to my clients is.... 1. We need to check to see how this property is zoned, and whether that zoning classification allows for that number of unrelated people to live in the property. 2. We need to check to see if there are recorded restrictive covenants for this neighborhood that restrict the number of unrelated people who live in the property. A few notes.... 1. Most single family homes in the City of Harrisonburg are zoned R-1 or R-2 and do NOT allow for three or more unrelated people (students or otherwise) to live in the property. 2. If a property has been used in a non-conforming manner (for example, four students living in it) since before the zoning ordinance was put in place, without a 24 month gap in the non-confirming us, it MIGHT be possible to continue to use the property in that non-conforming manner. And, if #2 above is starting to get confusing, then we arrive at my main reason for writing today.... CALL COMMUNITY DEVELOPMENT TO UNDERSTAND ALLOWED USE OF A PROPERTY! Yes, in fact, there are very helpful City staff in the Community Development department -- who can very quickly help you understand whether a property can be legally used as you intend to use it. And it is imperative that you make this call BEFORE you buy the property, and even BEFORE you make an offer on the property! | |
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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
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