Archive for July 2018
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Risk, Reward and Buying College Student Housing Rental Properties |
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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. Oh, and you might also want to read up here... | |
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Is It Time To Adjust The List Price Of Your Home? |
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 We should have another solid 60 days of strong buying activity (contracts being signed) before things start to slow down into the Fall, and then slow down even further in the Winter. If you are intent on selling your home before the end of the year, you may want to consider a price reduction now, rather than later. If you reduce your list pricethis coming Monday -- on July 30 -- you likely have a good 60 days of exposure to a larger pool of buyers before contract activity slows down. If you wait, and reduce your price on October 1, you have already had a large number of buyers pass your house by. Think strategically about how your house is priced to best position it to realistically be under contract within a timeframe that best works for you. | |
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What Counts As A Bedroom? |
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 You don't have to be a math major to count bedrooms, right? Well, technically, that's true -- but counting bedrooms for real estate purposes can become a bit nuanced. Now, the basic rule of thumb for what makes a bedroom is that it needs a window and a closet. So -- if you have a room with a bed, where someone sleeps (regularly, or on occasion) but it does not have a window or does not have a closet, it might not be considered by Realtors, buyers or appraisers as being an actual bedroom. Now -- the National Appraiser Roster has all sorts of nuances surrounding this topic....
Wow. OK. Lots to consider there. So -- the short answer is that you can count your bedrooms based on whether they have windows and closets -- but it may require a bit more thought and analysis before we decide how many bedrooms we'll say that your home has when we put it on the market. Oh, and two final notes....
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Should You List Your Home in August or September or October? |
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 Generally speaking, you should list your home sooner rather than later. As shown above, we are likely to see a declining number of buyers signing contracts between August and September - though then a slight increase again in October. If you are getting ready to put your house on the market in August, let's talk soon to start discussing market value and any preparations you need to make in your home before putting it on the market. | |
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With Few Homes On The Market, You May Have To Compromise A Bit |
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 The odds are, you'll have to compromise on SOMETHING when you are buying your next home. The question becomes -- what are you you willing to compromise on? The easiest (at first) sometimes seems to be price -- you still get everything you want, you just have to pay more for it. But if you're drawing a firm line on price, then likely some other need or want will have to be imagined differently. Above is a breakdown of what buyerscompromised on based on the the 2017 Profile of Home Buyers and Sellers from the National Association of Realtors. | |
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How To Determine The Square Footage Of Your Home |
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 So -- are you trying to figure out the square footage of your home? Here are a few methods that are not certain to give you the correct answer....
So, how do you really measure square footage? It starts outside the home! You'll need to measure the exterior dimensions of each level of your home -- and then subtract any open areas, such as the open space above a foyer. This measurement method, as odd as it may be, is what is used by nearly every appraiser, as it is how "gross living area" is defined by Fannie Mae, HUD, FHA, ERC and ANSI. As such, it is important that you're measuring the square footage of your home in the same way that nearly every appraiser and Realtor would be measuring it, so that you're comparing apples to apples when comparing the size (SF) of your home to another home that has sold or that is on the market for sale. And here's why I consider it to be an odd way to measure square footage....
While the City and County measurements for tax assessment purposes are often very accurate, it is often a good idea to double check the square footage of your home when we're putting it on the market for sale. | |
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Where Home Buyers Found The Home They Bought |
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 A new look at some data I have studied for years... What does this mean for home sellers? It means we need to focus our marketing efforts on where buyers are actually looking, and finding, homes for sale. And -- we need to get creative about how to market your home online -- it's not just putting it in the MLS -- but providing an extensive amount of information (photos, virtual walk through, floor plans, etc.) online to allow buyers to fully explore your house as a possibility in their home search. Learn more about the home selling process, and the marketing techniques I typically employ, by visiting SellingAHomeInHarrisonburg.com. | |
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Fresh Baked Cookies, An Advanced Home Selling Technique |
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 When the home buyers walked into the next home, they were greeted by the pleasant, and heart-warming fragrance of freshly baked cookies. They walked into the kitchen and were delighted to find cookies, indeed -- freshly baked cookies, prepared especially for them. This house already felt like a home, as they started enjoying a tasty cookie while touring the kitchen and beyond. :-) I have had several clients of late who have prepared a large batch of cookie dough and then would pop several cookies into the oven to bake before each showing. Delightful smells -- tangible hospitality -- how can you go wrong? | |
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Do Most Sellers Accept Offers With Home Sale Contingencies? |
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 Based on the analysis above, it would seem that sellers are not (in almost all cases) accepting home sale contingencies. Here's the logic....
I must say, I was quite surprised to find this to be the case --- I thought perhaps 10% of contracts might have kickout clauses (and thus home sale contingencies) because plenty of buyers have to sell before buying. It would seem that most buyers are likely waiting to make offers until they have their own properties under contract (thus eliminating the need for the kickout clause) AND/OR most sellers are not accepting offers with home sale contingencies unless the buyers' houses are already under contract (thus eliminating the need for the kickout clause). If you are a buyer, I would certainly suggest the strategy outlined above (and the only one that is apparently working with sellers right now) --- get a contract on your house and THEN make an offer on the property you would like to purchase! | |
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The Best Deals on Houses in Harrisonburg, Rockingham County |
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 One way for investors to identify the best deals in Harrisonburg is to compare the list price of each active listing to its assessed values. To make it super easy for you (and any other aspiring investors) I have created BestDealsInHarrisonburg.com which features properties that are being offered at a low list price compared to their assessed value. This is likely to mean that they are a "good deal" -- though if their assessed value happens to be high (relative to their market value) then the deal won't be as sweet. As always, consult a Realtor (such as myself) for expert advice on whether any particular property really is a great deal. BestDealsInHarrisonburg.com is simply shuffling some good prospects to the top of the pile for your consideration. What are you waiting for? Go check it out at BestDealsInHarrisonburg.com. | |
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New and Resale Options at Preston Lake |
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 view a larger image here Construction is moving right along at Preston Lake.
And, there are some resale, move-right-in, options as well, such as this home, which used to be the model home at Preston Lake...  Learn more about 3168 Preston Lake Boulevard. Explore all listings at Preston Lake here. | |
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June 2018 Marks 5th Highest Month of Home Sales, Ever |
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 The 165 sales seen in June 2018 is the highest seen any time in the past 10 years! Going back 15 years we do finally find a few months when there were more home sales:
I don't anticipate that we'll see another month of 165 home sales this year. TBD If we can see that many next year. Learn more about our local housing market in my most recent monthly market report...  | |
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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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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
Licensed in the
Commonwealth of Virginia
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