Archive for February 2025
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What To Do When Comparable Sales Tell Two Very Different Stories |
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![]() When we are preparing to get your house on the market for sale we will looking together at a market analysis of your home to determine a pricing strategy. I will start by looking for the most similar homes that have sold in the recent past (usually 6 to 12 months) to give us guidance on what price a buyer might pay for your home. Oftentimes, these similar homes (comparable sales) will all fall neatly in line... House #1 - very similar, sold for $425K House #2 - a bit newer and a bit larger, sold for $450K House #3 - a bit older and a bit smaller, sold for $400K As you might guess, these three comparable sales would suggest that your home will sell for $450K. But... sometimes the comparable sales don't provide as clear of guidance... House #1 - very similar, sold for $425K House #2 - very similar, sold for $415K House #3 - very similar, sold for $400K ...and... House #3 - smaller, sold for $475K House #4 - smaller, sold for $485K House #5 - smaller, sold for $505K When we start to see a greater degree of variance in the prices for which comparable homes sold, and when they don't all point to the same general price point for your house, pricing your home can be come a bit more challenging. Do we pick the most optimistic (highest) comparable sales to price your home? Do we pick the most conservative (lowest) comparable sales to price your home? When this happens, we will need to look through the data together in detail to determine which comparable sales we believe are the most comparable, and thus the most applicable in estimating the value of your home in the current market. It's great when we have multiple data points all converging on a single value for your home -- but it is not always that simple or clear cut. | |
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I Would Not Be Disappointed To Miss Out On This House If Someone Wants To Pay That Price |
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![]() Sometimes you'll absolutely LOVE a new listing... but not the asking price. You might believe it's a fair price for the house... it's just more than you would want to pay. Or... you might think the price is too high for the house. Regardless, you don't want to pay the list price for the house. Maybe you'd pay $20K or $30K less than the list price... but you wouldn't pay the list price. In such a situation, most buyers conclude that while they might or might not make an offer... they won't be disappointed if a buyer comes along that is willing to pay the list price for the house. A helpful perspective to consider as a buyer is whether you would be disappointed if someone else other than you gets to buy the house. | |
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Home Sales, Contracts, Off To A Slightly Slower Start In January 2025 |
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![]() Happy SNOWY Wednesday, friends! After a solid eight inches about two weeks ago, we had another six inches yesterday! Some even say we might have another snow next week!?! This has been a particularly snowy winter! Here's a snowy view on the east side of town earlier this morning... ![]() Beyond the snow, though, we're more than a month (almost a month and a half) into 2025 and I'm taking a look back at the first month of real estate data to see what trends we're seeing thus far this year. Now then, on to some tasty morsels of data from our local real estate market... First up, the latest trends through the end of January 2025... ![]() While not highlighted above, you might note that we saw a 15% drop in January sales this year (80) compared to last (94) -- though January sales exceeded 2023 levels (76). More on January sales later. When we look back at the past three months (November through January) we see a 22% increase in the number of home sales taking place as compared to the same timeframe a year ago. This is accompanied by a 3% increase in the median sales price. If we look at a longer timeframe (12 months) we will find only a 9% increase in the number of homes selling -- but a 5% increase in the median sales price. Combine these two trends and it would seem that we might be seeing an acceleration in the number of homes that are selling-- but a slowing in the rate at which prices are increasing. Jumping for a moment to detached homes only... ![]() When we look at detached homes only (excluding townhomes, duplexes and condos) we find only a 15% increase in sales over the past three months (compared to a year ago) whereas there was a 22% increase in overall sales. Thus, it shouldn't surprise you to see the following in the attached market... ![]() In contrast to the 15% increase in detached home sales between November and January, here we see a 40% increase in attached home sales! That's a significant jump! There has also been a 22% increase in attached home sales when looking at the past 12 months (compared to the 12 months before that) compared to only a 4% increase in detached home sales. So... we're seeing more of an increase in attached home sales this days as compared to detached home sales... but that could be a result of so many attached new homes being built. Here's a look at new home sales... ![]() Over the past 12 months we have seen 389 new home sales in Harrisonburg and Rockingham County -- which marks a 29% increase from last year. Whereas in the existing home market (everything except new homes) we're seeing... ![]() In contrast to that 29% increase in new home sales, we're only seeing a 3% increase in existing home sales. Why could this be? Well... new home builders are happy to keep on building new homes, but it's not too surprising that homeowners (would be sellers of existing homes) are only so excited to sell, because... 1. Many such homeowners have low interest rates on their current mortgages... which would be replaced with higher rates on a new mortgage. 2. Despite likely have plenty of equity in their existing home... they would have to spend even more on a replacement home. As I just someone I was chatting with... if you like the home you own and if it's working well for you... don't sell! :-) Peeking in on the two main geographic areas I cover... ![]() The City of Harrisonburg has seen (gasp) a 3% decline in home sales over the past year. It's actually even more stark when looking back two years where you would see a cumulative 33% decline in home sales. One of the reasons why home sales are decreasing (happening less frequently) in the City of Harrisonburg is because there aren't many new homes being built in the City. Meanwhile, in Rockingham County... ![]() In contrast to the 3% decline in home sales in the City of Harrisonburg... there has been a 14% increase in home sales in Rockingham County. We could note, though, that the 1,059 home sales in Rockingham County over the past 12 months is actually a bit (6%) lower than two years ago. Now, on to some graphs, starting by showing January 2025 in context... ![]() Indeed, the 80 home sales seen seen in January 2025 was a good bit lower than the 94 home sales seen last January... as well as lower than the average (95) of January sales over the past four years. Good news, though, the 80 home sales in January is likely to be the lowest month of home sales for all of 2025! Looking at a slightly broader context for our overall market... ![]() Home sales increased in 2024 compared to 2023... and that increase seems likely to continue in 2025. After four years (2020, 2021, 2022, 2023) of a 10% or greater annual increase in the median sales price... we only saw a 5% increase in the median sales price in 2024. At first glance, the graph above would seem to indicate that prices are starting to decline... but it's too early for that decrease ($345K to $341K) to mean much as we only have 80 sales prices in that median thus far in 2025. Now, I hesitated to say that January home sales were slower than expected because of snow -- since January sales are based on December contracts -- and the snow has taken place in January. But we can potentially blame the snow for this following graph... ![]() Only 97 home buyers and sellers signed contracts in January 2025... compared to 108 last year... and compared to a four year average of 117 for the month of January. Why did only 97 buyers and sellers sign contracts in January? Perhaps because everyone was too busy shoveling snow? But seriously... the winter weather has delayed plans for some sellers to list their homes for sale... which delays a buyer's potential contract to buy said home. TBD if further winter weather will continue to impact the winter real estate market. Oh, right, it is winter - I suppose the snow is reasonable. :-) Next up, pending sales, the number of homes that are under contract waiting to go to closing... ![]() We are seeing a normal-ish amount of homes currently under contract for this time of year in Harrisonburg and Rockingham County. The 243 homes currently under contract is certainly lower than the 270 homes under contract a year ago, but I believe this lower number is a result of fewer homes being on the market for buyers to buy. To reinforce that theory, take a look at inventory levels now versus a year ago... ![]() A year ago there were 182 homes on the market for sale... today... only 140 homes. This is a significant year over year decline. We might see a slight uptick in homes for sale as we get towards the spring market, but it is also quite possible that buyers will continue to contract to purchase those new listings as soon as they are listed for sale. Finally, as referenced earlier, current mortgage interest rates compared to the mortgage interest rate on any homeowner's current mortgage might be a part of why some sellers are not selling... ![]() Despite mortgage interest rates (between 6.5% and 7%) seeming high compared to many homeowner's mortgage interest rate on their current mortgage -- these 6.5% to 7% rates seem to be the new normal range that we may be experiencing for the indefinite future. Looking back over the past two years, while we saw a few months above or below that range, mortgage interest rates mostly remained in that range. So... given all of that data on our local real estate market and the current mortgage interest rate environment, what should you keep in mind as we continue through 2025? If you will be selling your home, you are likely to continue to see solid buyer demand depending on your price range, property type and location. It will be important to price your home appropriately as most buyers' budgets will be limited by 6.5% to 7% mortgage interest rates. Listing your home for sale sooner than later might give you the opportunity to have less competition from other sellers, but waiting until spring is a reasonable strategy as well if that timeline better fits your overall plans. If you will be buying a home, go ahead and get preapproved with your favorite lender (ask if you need a recommendation) so that you are ready to make an offer when we find the right house for you. It's possible you will be directly competing with other buyers in a multiple offer scenario depending on where you want to buy, what you want to buy and your budget. Don't be discouraged by currently low inventory levels - there will be plenty of new listings hitting the market as we move into spring. If you found the information in this market report to be helpful, but you have a few more questions about your segment of the local market, or about your house, or about the buying process or selling process, feel free to reach out anytime. I'm here to help. You can contact me most easily by phone/text at 540-578-0102 or by email here. I'll send you another update on the local housing market in March. Maybe, possibly, we'll be past all of the snow by then!?! | |
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One Final Home Improvement To Complete The Overall Impression Your House Offers |
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![]() Sometimes almost every aspect of your home tells a single narrative... Hopefully it's not a narrative of... "This house is falling apart and needs to be completely remodeled." :-) More often, it is a narrative of... "This home is very well maintained and has a lot of character and I can tell that the owners have made nice improvements over the years." But sometimes... there is just ONE more improvement that is needed to complete that narrative. It might be a fresh coat of paint in a few rooms... or replacing one or two light fixtures... or freshening up the landscaping right in front of your house... or painting the faded front door. If your house looks MOSTLY well put together and well maintained... and ONE final improvement would complete the narrative, it is likely worth taking the time to make that improvement. | |
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Pricing Your Home With A Very Old Roof |
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![]() So... you are getting ready to list your home for sale... and your roof is 32 years old. Woah! Most architectural shingles have an average lifespan of 25 to 30 years. If your roof does not have any leaks, and thus you don't want to replace the shingles before selling your home, how should you think about pricing your home? Side note - You had three roofers come by and the average quote for replacing your roof is $20K. Now, let's imagine these three other very similar homes in your neighborhood have sold in the past six months... Home #1 - new roof, sold for $475K. Home #2 - five year old roof, sold for 470K. Home #3 - eight year old roof, sold for $470K. So, can you assume your house will also sell for $470K to $475K despite the very old roof? Probably not. Most buyers will realize that your roof is beyond it's expected lifespan and will factor in the cost of roof replacement when they consider the price they are willing to pay for your house. Given that it will cost approximately $20K to replace your roof, buyers will likely want to pay between $455K and $460K for your house. So, you could... [1] price your home for $475K (the price of the house with the new roof) and hope for the best [2] price your home at $465K ($10K less than the price of the house with the new roof) and hope that is enough of a discount for a buyer. [3] price your home at $455K (the cost of the roof replacement lower than the price of the house with the new roof) and be very confident that most buyers will find your house to be very fair I will likely recommend we consider strategy #2 above - but we will want to examine how much competitive buyer interest there is in your price range. | |
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With Few Homes On The Market We Should Go Look At Homes That Seem Close To Ideal |
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![]() You can learn a LOT about a home for sale these days without going to see it inside via...
As such, some would be home buyers eliminate houses from consideration just from what they are learning via research on their phone, computer, or from behind the steering wheel. Eliminating some houses from consideration based on learning this variety of information makes sense -- so long as you are not accidentally eliminating ALL homes from consideration. Given that there aren't many homes on the market at any given time these days, if you find that you are eliminating all homes from consideration for one reason or another just based on your online review of the property information - perhaps we should go visit the next few "maybe" houses in person. Walking through a house that is close to ideal, but probably not perfect, can be helpful... 1. It might be more perfect than you realize. 2. It might cause you to adjust your priorities or goals. So, as we head towards the spring market, if you are hoping to buy a home and find that you are eliminating every home before going to see it -- let's go look at a few just to see if you come to the same conclusion about them. | |
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Just Because LOTS Of New Listings Will Be Coming In March Does Not Mean You Need To Wait Until March To List Your Home |
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![]() We typically see a significant surge of new listings in March in Harrisonburg and Rockingham County. For whatever reason, lots of sellers typically wait until March to list their home for sale instead of doing so in February. The reason for waiting might be... 1. To wait until the weather warms up a bit. 2. To aim for a late spring closing. 3. To hopefully start seeing some signs of life in the yard or garden. Or maybe... 4. Because that's what all the other sellers are doing. Just because lots of homeowners will wait until March to list their home for sale doesn't mean you should wait too. Listing your home for sale in February will often lead to an equivalent or higher amount of buyer interest due to having less competition from other sellers. So, if you're waiting to list your home until March -- arbitrarily -- perhaps we should make plans to get it on the market in February instead! | |
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An Early Look At January 2025 Contract Activity |
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![]() It's early in the year still... we shall not draw any conclusions yet about whether 2025 will be a busy or not busy year in the local real estate market compared to the last few years... but... As shown above, only 92 contracts were signed (by buyers and sellers) in January 2025 -- which is the slowest January since 2019. To be fair, January 2025 was an odd month... we had a lot of snow, and it stuck around much longer than snow usually does in the Harrisonburg area. So, perhaps we'll see some of the usual January contract activity showing up in February this year instead. Stay tuned! | |
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Site Work Has Begun For Townhouses, Apartments On Corner Of North Main Street, Mount Clinton Pike |
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![]() Dirt is moving for the construction of townhouses and apartments on a development located on the corner of North Main Street and Mount Clinton Pike. The original plan referenced 60 townhouses and 34 apartments... ![]() You can now see that layout reiterated on the Harrisonburg GIS... ![]() | |
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Construction Underway On Valley View Village Apartments On Reservoir Street |
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![]() Dirt is moving and a construction is underway on the first apartment building at Valley View Village on Reservoir Street, a development planned to include 420 one, two and three bedroom apartments. Here's the original planned layout... ![]() Here's a map for context... ![]() Here's a closer view of the site showing the first few buildings where construction is underway now... ![]() | |
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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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