Brought to you by Scott P. Rogers, Funkhouser Real Estate Group, 540-578-0102, scott@HarrisonburgHousingToday.com
Brought to you by Scott P. Rogers, Funkhouser Real Estate Group, 540-578-0102, scott@HarrisonburgHousingToday.com
Monday, September 14, 2020
Happy Monday Morning!
Temperatures are cooling, and fall will soon be upon us! It looks like the high temps will be in the 70's all week - except Friday when we're expected to have a high of only 67 degrees! I love fall and am looking forward to the slightly cooler weather.
But even if the temperatures are cooling off, local home sales are not necessarily doing the same!
Before we dig into the data this month, be sure to check out Congers Creek, the new townhouse neighborhood being built on Boyers Road near Sentara RMH Medical Center by visiting CongersCreek.com.
Now, feel free to download a PDF of my entire report, or read on for highlights...
Quite a few items to note above...
- There were 10% more home sales in August 2020 (132 sales) than we saw last August!
- Year-to-date home sales (899) are now only about 1% behind where we were (906) last year at this time.
- We've seen 1,316 home sales in the past 12 months -- which is ever so slightly (0.38%) higher than the previous 12 months when there were 1,311 home sales.
- Home prices are rising, and quickly!?! The median sales price in 2020 is $239,900 which is 9.54% higher than a year ago when it was $219,000.
- Homes are selling about faster (this year) than fast (last year). It only took homes a median of 18 days to go under contract last year -- but now that has dropped to only 11 days!
Now, let's take a look at how the past few months have fallen into the context of previous years...
As you can see above, May and June were remarkably SLOW months for home sales - well below the normal pace for those months.
But then, July and August came storming in -- with higher numbers of home sales than we would have or could have expected.
So it seems that home sales may have just shifted this year to be later in the year than most years.
Who could even guess what might happen in September and October at this point!?!
And here is how the year is stacking up with the past two years thus far in 2020...
For all the things one might say about 2020, it seems we won't be able to say that home sales stunk.
A busy late-summer has caused this year to catch right back up (almost) to where we have been for the past two years -- and based on contract activity (keep reading) I think we might surpass last year's sales trajectory as we close out 2020.
That's not to say, of course, that home sales didn't take a temporary dip as a result of COVID...
Indeed, the annual pace of home sales took a nose dive in the spring -- OK, that might be an exaggeration, but they did slow down. Despite that temporary slow down, though, home prices kept right on climbing!?! That disconnect likely means the slow down was largely a result of sellers not wanting to sell -- not a result of buyers not wanting to buy.
Now about those rising prices - how fast are they actual increasing?
Faster than anytime recently - though barely. We've seen an 8% increase in the median sales price between 2019 and 2020. To try to put that in context...
- Over the past 3 years we've seen an average increase of 5% per year.
- Over the past 7 years we've seen an average increase of 4% per year.
So - I guess prices are rising somewhat faster than in recent years, but not absurdly faster.
Now, let's look back in order to look forward...
The graph above is showing us contract activity -- when buyers (and sellers) are signing contracts, not when they are closing on their purchase/sale.
As you can see, this was a blockbuster of a summer for contract activity! Only 369 contracts were signed last June through August, and that increased to 495 contracts this June through August. That's a 34% increase in summer contracts!
This all means we are likely to see a high number of home sales continue take place as we move into the fall. I expect that we'll see an abnormally high number of home sales in both September and October.
Perhaps it is no surprise that all of these buyers signing contracts is keeping/driving inventory levels low, so very, very low...
There have been fewer, and fewer, and fewer homes on the market at any given time as we have moved through this year. It is a tough time to be a buyer as there are not many choices for you at any given time, and you will likely have competition from other buyers if you are pursuing a new listing.
Those buyers who are able to secure a contract on a house are financing their purchases at some rather extraordinary rates...
The mortgage interest rates they just keep on falling The average rate fell to 2.91% by the end of August, and I have seen my clients locking in as low as 2.85% and even 2.75% on a 30 year fixed rate mortgage!
OK - that brings our monthly jaunt through the local homes sales data to a close, for now. You can read more about our local real estate market on my blog, and of course you can email me (scott@hhtdy.com) with any questions about the market or about your particular situation.
Some key take aways...
BUYERS
- Get pre-qualified for a mortgage ASAP.
- Look at houses the day they are listed.
- Be prepared to make an offer on Day 1.
- Know that you might be competing with other buyers.
- Learn about escalation clauses and how to use them.
SELLERS
- Pricing your home appropriately, preparing it well for the market, and marketing it rapidly, thoroughly and professionally are still the secret sauce to securing a buyer.
- If your home has been on the market for 60+ days and still has not sold, you will likely have to start thinking about whether to make a price reduction in order to secure a buyer. If buyers are not responding (with an offer) at your current pricing, consider making an adjustment sooner rather than later.
OK, that's all folks! I hope that you have a wonderful balance of September, and that you and your family are healthy and well and are finding ways to manage the many changing dynamics in our daily lives!
Reach out anytime (540-578-0102 or scott@hhtdy.com) if I can be of any help to you!
