Archive for December 2019
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Responding Well (or not) To A LOW Offer On Your House |
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 Sellers are sometimes quite shocked, dismayed or disheartened to receive a low offer on their house, for example, an offer of $325K on a $375K listing. But it is important to remember that even that low offer really is a compliment!
 If you have not yet had an offer on your house (that is listed at $375K) and you receive an offer of $325K, that doesn't necessarily mean your house is only worth $325K, nor does it necessarily mean that you should accept $325K or something close to it. It does, however, mean something quite exciting --- somebody wants to buy your house!!! Of course, negotiations won't always work out with low offers -- but recognize a low offer for what it is -- a buyer who wants to buy your house, and perhaps the first buyer who has declared as much through a written offer! If there is any way to put a deal together with those buyers, you ought to pursue it, as it's hard to know when the next buyer will work up the courage to tell you that they want to buy your house! | |
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It Might Be Hard To Find A Home To Buy In The City of Harrisonburg |
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 The number of homes for sale in the City of Harrisonburg keeps dropping. That's not to say that homes aren't selling -- a total of 390 homes have sold in the City of Harrisonburg during the first 353 days of the year -- putting us at a pace of around 34 home sales per month. But the number of homes available to buyers continues to decline -- now down to only 42 homes for sale! Here's a bit longer of a context....
And now -- only 42 homes for sale! If you're looking to buy a home in the City of Harrisonburg it might be difficult to find a home that is a perfect fit or you given a very limited supply of homes for sale. And when a home does come on the market that works for you, it is likely to sell quickly. | |
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Last Chance To Build A New Home at Heritage Estates |
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 If you want to build a home at Heritage Estates -- an active adult community in Harrisonburg, Virginia with homes featuring French Country architecture -- this is basically your last chance to do so! There has been a flurry of buyer activity in the neighborhood and there is now only ONE remaining home site (Lot 18) on which you can build a home.  The developer is also building a model home (rendering above) on Lot 30 (details in a PDF here) -- so that is an option as well, though it is framed in and under roof, so you don't have quite as much flexibility as to what you might build. Find our more about Heritage Estates here and email me if you have further interest or questions. | |
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JMU On Campus Enrollment Seemingly Plateauing Just Under 21K |
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 Based on JMU's enrollment projections approved by the State Council of High Education for Virginia, on campus enrollment...
These figures, and their changes over time, are the best numbers to be using when analyzing the need for off campus student housing in Harrisonburg -- and seem to be indicating that our local market does not need more student housing -- since enrollment is only anticipated to rise by 205 students between now and 2025. | |
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Home Buyer Activity Will Slow But Not Stop Over The Winter |
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 Generally speaking, folks don't use their outdoor hose spigots in the winter. I suppose you might use it from time to time, but it's just not as fun to wash your car in the driveway on most December days. Oh, and if you did use your hose spigot, and left the hose attached, you'd potentially have serious problems when the water in the hose freezes, backs up into the spigot, maybe into the pipe, and something splits, cracks or bursts. So, once we get into Winter, most folks are turning off their hose spigots for the last time until Spring. But not so with the local housing marketing. Between March and August (Spring and Summer, as we'll call it) an average of 134 buyers signed contracts to buy houses each month. A pretty rapid pace of buyer activity. So, this winter, what should we expect? Will that supply of buyers be turned off like a hose spigot, and will the buyers slowly drip out at a rate of 13 buyers per month? Thus, 10% of the pace of buyer activity in the Spring and Summer? Nope! Looking at last Winter (December, January, February) there were an average of 79 buyers signing contracts per month! Yes, you read that correctly, only a 41% decline in buyer activity during the Winter months -- as compared to the Spring and Summer months. So, unlike your hose spigot, which will likely be barely used during the Winter -- the local housing market doesn't slow down, or cool down, or shut down, nearly as much. | |
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When Buying A Home, Keep In Mind That School Districts Can Change |
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 In the news lately...
There are a few more possible changes in Rockingham County, but the above is a sampling of possible changes. Read about the plans for change in Rockingham County Public Schools here. All of this is to say that if you are buying a home, and one of the critical factors is whether it is in school district X or school district Y, then we'll likely want to check to see if you are in an area that might be affected by changes that are currently being discussed -- AND -- you should know that further changes in school districts could take place before your sweet little Johnny (currently 2 months old) is old enough to go to high school. As a random side note, the Rockingham County school district map (shown above) downloadable here does not appear to have chnaged in the past nine years! So, I suppose change had to happen eventually... | |
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Gazumping Is Not Common Among Harrisonburg Home Sellers |
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 Gazumping!?!? What in the world is that? I had to Google it after a homeowner referenced it when I was meeting with them this week. It seems it is more common in England and Wales than it is here -- thankfully! Per Dictionary.com... gazump - to cheat (a house buyer) by raising the price, at the time a contract is to be signed, over the amount originally agreed upon. Some sellers in this market might price their home extraordinarily competitively to aim towards having multiple (above asking price?) offers to consider -- but they don't typically gazump. Scenario 1 -- Homeowner concludes that her home is worth $300K. She lists it for $295K and is delighted to receive offers for $295K, $300K, $302K and $304K. She sells the house for $304K. Not gazumping. Scenario 2 -- Homeowner concludes that his home is worth $300K. He lists it for $280K, receives an offer of $290K, tells the buyer he is going to accept it, and then changes the price to $305K after the buyer has signed the contract, and demands that the buyer initial and approve the change. Definitely gazumping. So. Don't gazump. :-) PS. Gazumping has nothing to do with camels. Gazump rhymes with hump and camels have humps. Sorry for any confusion. ;-) | |
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Home Sales Solid, Contracts Strong, in November 2019 |
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 Happy December, friends! The end of the year is approaching, so let's take one last partial-year look at our local housing market before we have a full twelve months of data to analyze. You can download my full market report here or read on for the high points... But first -- check out this custom built home on six acres, pictured above, by visiting 3449WildwoodDrive.com. Now, to the data...  As shown above...
Now, breaking things down between detached and attached homes...  As shown above...
It can also be helpful to break things down between the City and County...  As shown above...
But in the County...  As shown above...
And now, for the roller coaster of month-by-month home sales activity...  I thought we'd see more home sales in November than we did end up seeing. The 86 sales this November was more than we saw last November -- but a good bit below the prior two months of November. Looking forward, I'd expect we'll see around 90 home sales in December.  When we stack up each of the past three years -- plus this year -- you'll note that we're almost certainly on track to see 1,300 home sales in 2019 -- and we may very well beat the recent high of 1,313 sales seen back in 2016.  When looking (above) at the annual pace of sales (the orange line) you'll note that it has bounced around some over the past year -- but has stayed right around 1300 sales per year. During that same timeframe, however, the median sales price has been slowly (and then more quickly) rising -- up from $212K a year ago up to $219,950 when looking at the most recent 12 months of sales data.  Examining a slightly longer (four year) trend we'll see that home sales have stayed right around (just above, just below) 1300 home sales per year -- while the median price of those homes has climbed, on average, 4.5% per year. This increase in prices is certainly higher than the 2% - 3% long term historic "norm" but is much more sustainable than the double digit annual increases we saw during the past real estate boom.  Here's (above) a curious one -- and an unfortunate one for buyers -- over the past few years the same number (more or less) of buyers have been buying -- but they have had fewer and fewer and fewer homes from which to choose at any given time. It has caused homes to sell more quickly and buyers to become more frustrated.  While closed sales were slower than I expected in November -- buyer activity in contracting on homes was much more active than I expected! We typically see a drop off between September/October and November when it comes to signed contracts -- but this year, we saw just about as many buyers commit to buy homes in November as we had seen in September and October. The 96 contracts signed in November gives me hope that we'll see 84 sales in December, which would get us up to 1,300 home sales for the year.  Did someone say inventory levels were low? Yes, inventory levels are low! You'll see that the number of homes on the market (for sale, not under contract) has now dipped down to 236 homes as of the end of November / beginning of December. Again -- a great time to be a seller, but not as exciting of a time to be a buyer. Maybe we need some new construction??  Over the past eight years we have seen more and more home sales -- and fewer and fewer foreclosures. Just two years ago 134 properties were foreclosed upon in Harrisonburg and Rockingham County -- and in the first 11 months of this year that number has only been 54 properties!  If, as a buyer, you somehow manage to find a home to buy -- you'll be excited to find extremely low mortgage interest rates. They have been below 4% for the past seven months now, giving you the opportunity to lock in a low housing cost with a fixed rate mortgage. OK, I'll wrap it up there for now. Again, you can download a PDF of my full market report here, or feel free to shoot me an email if you have follow up questions. In closing... If you're planning to sell over the next few months -- let's get going now/soon while inventory (your competition) is SUPER low. We can connect at your house or my office to discuss timing, preparations for your house, pricing within the current market and more. Call (540-578-0102) or email me and we can set up a time to meet to chat. If you're planning to (or hoping to) buy a home soon, be ready to be patient and then to ACT QUICKLY! :-) Make it a bit easier for yourself by knowing the market, knowing the process, knowing your buying power, and closely monitoring new listings! That's all for now. Enjoy the remainder of the year, and I'll be back in January with a full re-cap of our local housing market for all of 2019. | |
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Home Buyers and Sellers Often Have Very Different Perspectives When Negotiating Repairs After A Home Inspection |
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 While not always the case, a general rule of thumb is that... On home inspection repairs...
Inspector: Several roof shingles are missing, and the roof is past its life expectancy. Seller: Replace the shingles. Buyer: Replace the roof. Inspector: The air handler coils are dirty and the heat pump is reeaaallly old. Seller: Clean and service the heat pump and air handler. Buyer: Replace them both! These are a few extreme examples to start to show the differences in perspectives on repairs. Again, the important thing here is to recognize that a buyer and seller look at home inspection reports differently. A seller typically wants to minimize their repair costs while keeping the home sale on track. A buyer wants to make sure that any previously unknown property condition issues are addressed in a manner that is likely to prevent further near term maintenance needs in those areas. So, what is a buyer to do? A few thoughts....
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Should You Round Your Bedroom Count Up Or Down? |
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 I tend to come at this from the "under promise, over delivery" perspective... I have been in three houses this past week where the number of bedrooms is a bit nebulous...
There are, of course, pros and cons of rounding down or up... If you round down, it is likely that every buyer that views your home will find that it has enough bedrooms -- and they'll likely be pleasantly surprised at the additional sort-of bedroom -- but you might miss out on buyers who really need that other bedroom and thus don't even consider your house based on the bedroom count. If you round up, it is likely that many buyers that view your home will be disappointed to conclude that it does not have enough functional bedrooms -- though you will likely have more buyers looking at the house in general, because of the higher bedroom count. So -- there is no perfect rule for determining whether to round up or round down when counting the bedrooms in your house -- but will likely do you well to thin about how many functional bedrooms most buyers would consider your house to have... | |
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How To Remove Cigarette Smoke Odors From A House |
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 I have shown a few houses lately to buyers where we couldn't help but notice a lingering cigarette smoke odor in the home. That smell was not the only factor that kept these buyers from making an offer on these houses -- but it certainly was a part of the discussion and decision. So how in the world do you get a pervasive cigarette smoke smell out of a house? I'm not an expert, but my understanding is that you may need to consider some or all of these techniques:
Even if you take all of those (not inexpensive) steps above, you may still have some lingering smells -- and if you do, you probably shouldn't be entirely surprised. You might then consider using an ozone generator which can help eliminate odors. If you're going this route, you'll likely want to consult with a professional. In the end -- if you are considering the purchase of a home that has a pervasive smell of cigarette smoke, don't assume that it will be easy or inexpensive to remove that odor! | |
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Will You Take Your House Off The Market Over The Winter? |
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 In some ways, NO, you should NOT take your house off the market -- because housing inventory levels have plummeted in December. And yet, still, some folks will take their homes off the market for the winter. Our local MLS requires a house to be off the market for 90 days before the "Cumulative Days on Market" statistic resets. So, if you take your house off the market today, you could put it back on the market right around March 5, 2020 and have that statistic reset. During these 90-ish days of being off the market, we will want to talk about price, condition and marketing....
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Housing Inventory Levels Plummet in December |
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 First - a note - each data point above is for the end of the given month. Thus, the 235 homes for sale in November are at the end of November -- or, as the case may be, the very beginning of December. Now, there are a few disclaimers I could make about the above data...
Regardless of the reason or explanation, though, the current inventory levels are SUPER low! Which is terribly frustrating for buyers -- and a great opportunity for any home owner who does need to sell right now. You are not likely to have much competition from other sellers! Stay tuned later in the month when I compile my full monthly report and we'll see if inventory levels perked back up as we made our way further into December. | |
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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
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Commonwealth of Virginia
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