Archive for September 2020
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Lots of Homes Selling (Going Under Contract) in September 2020 |
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 Buyer activity usually starts slowing down in September. After all -- spring is usually the busiest season for buying, followed by summer. But this September, buyer activity has been STRONG! As you can see, above, we have seen 73 to 87 contracts signed in the first 25 days of September during each of the past three Septembers. But this September -- there have been 106 contracts signed in the first 25 days of the month! Nothing has been normal this year, and September is proving to be no different. Home sales don't show any signs of slowing down yet this year! | |
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Analyzing the Accuracy of Zillow Zestimates In Harrisonburg and Rockingham County |
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 download the infographic above as a PDF Do homeowners enjoy checking out the Zillow Zestimate for their home? Yes Are Zestimates accurate indicators of market value of homes in some real estate markets? Yes, probably. Are Zillow Zestimates for properties in Harrisonburg and Rockingham County a good indicator of the price for which a home will sell? No, not at all. This used to just be a hunch, but now I can back it up with data. To answer this question...
As shown above...
So, as a homeowner thinking of selling your home... the Zestimate for your home might happen be accurate - but that would be the exception, not the rule. Only 37% of pre-listing Zestimates were within 5% of the final sales price of the houses. And as a home buyer thinking of buying a house... you shouldn't necessarily expect to only have to pay the Zestimate for a house, because those values are often too low... and yet you also shouldn't necessarily be willing to pay as much as the Zestimate for a house, because those values are often too high. In the end, just understand that the Zestimate for your home (in Harrisonburg and Rockingham County) is much more likely to be inaccurate than accurate. Presumably, you wouldn't want to make a decision about the asking price for your home with a value indicator that is on average 13% different than market value. That is an average of $27,943 -- and most sellers don't want to under-price or over-price their home by that much! | |
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Which Rockingham County Zip Codes Have The Highest Home Prices? |
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 I took a look at single family home sales, on less than an acre, over the past 12 months (9/1/2019 - 8/31/2020) and looked for zip codes with 20+ home sales. Here's what I found as far as median sales prices...  As you can see, areas east (Penn Laird, McGaheysville) and south (Bridgewater) as well as Harrisonburg itself have higher sales prices -- whereas Dayton, Grottoes, Elkton and Timberville round out the bottom of the list. Some of the differences in prices between zip codes noted above can easily be understood once realizing that different sized homes are built in different areas. I thought that evaluating price per square foot might, thus, be a good way to compare the zip codes -- but I actually came to a different conclusion after I ran the numbers...  As you can see above, some of the localities with the highest median price per square foot (Grottoes = $152/SF, Broadway = $147/SF) have the lowest median sales price. How could this be!? Well, basically, smaller homes tend to have higher a higher price per square foot than larger homes. Thus, I added in one more column, above, to show the median size of the homes sold in each zip code. There, you can see that the reason why some of the lower priced zip codes are higher on the list (above) are a result of the smaller size of the homes in that zip code. Re-sorting, then, you can also get an interesting view on where larger homes and smaller homes tend to be located on a zip code level...  All this, by the way, is thanks to a few questions from Howie - curious blog reader. Thanks Howie! Good questions, and interesting (I think) data/results! | |
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How Much Overlap Exists In Your Home Buying Priorities? |
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 If you have three non-negotiable home search criteria, it is important to reflect on (or at least be aware of) how much overlap exists between these criteria. Above are two examples of this way of thinking about your home search.... The first set of buyers will likely have lots of options (large yellow overlap area) because many homes share these criteria:
The second set of buyers will likely have very few options (small yellow overlap area) because there are very few homes that share these criteria:
These are fictitious illustrations -- they don't represent the actual amount of overlap that does or does not exist based on the criteria noted above -- but you should give some thought to how small of an overlap area you are creating for yourself based on what you are defining as non-negotiable in your home search. If that area is too small, you'll have very few options to consider, and eventually you may decide to flex a bit on what you had previously considered to be a non-negotiable point. | |
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Where Do We Focus First? Selling Your Home? Or Buying The Next Home? |
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 If you are getting ready to sell your home AND buy your home, it can sometimes be difficult to determine where to start... Do you start by finding a house you want to purchase? Or do you start by listing your home for sale? I would suggest that you start with whichever you anticipate will be the most difficult part of the two step process. If it will be difficult to sell your home (because of price, location, layout, features, age, etc.) and it will be at least slight easier to buy the next one (plenty of viable options are listed for sale) then you are likely best off starting with listing your home for sale. Work to get the more difficult half of the transition underway by getting your current home under contract, and then work on the easier side of the transition. If it will be more difficult to buy the next house (because of the specificity of your housing goals, or because of low inventory levels, etc.) and it will be at least slightly easier to sell your current home (because the property type, location or price are in high demand) then you are likely best off focusing first on finding the home to buy -- and then listing your home for sale. There are plenty of nuances we can discuss further to formulate a plan for attempting to simultaneously sell and buy -- but as a general rule of thumb, you'll be best off to start with the harder half of the transaction. | |
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New Condos For Sale at Founders Way in Harrisonburg, Virginia |
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 New condos are now being offered for sale at Founders Way in Harrisonburg, Virginia. These brand new condos, just minutes from downtown Harrisonburg, offer low maintenance living at its best, in close proximity to dining, shopping, the JMU campus and more! Make your selections today for your cabinets, granite countertops, flooring, paint color and more! Condos at Founders Way feature an open floor plan a large primary bedroom suite and a second bedroom or office with walk in closet and attached bathroom, plus a covered porch! Enjoy high-speed internet access and cable service! Find out more about Founders Way by visiting FoundersWay.com.
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How Early Should You Make Loan Application? |
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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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Spring and Summer Looked A Bit Different This Year In Our Local Housing Market |
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 We always (I mean, always!) see more contract activity in the spring than the summer. More buyers contract to buy homes between March and May than between June and August. Always. For sure. Definitely. But not in 2020. Over the past three years we have seen a 15% - 18% decline in contract activity when comparing summer to spring - but this year contract activity INCREASED 32% when comparing summer to spring! This certainly had a lot to do with COVID-19. Plenty of buyers and sellers were feeling a bit uncertain this spring, which slowed down the pace of sales in our real estate market. But -- everything came roaring back this summer! Who knows what fall will look like this year in our local real estate market, but summer was certainly unusual! Yes, and I suppose spring was as well. :-) | |
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Advanced (and fun) Mapping Techniques with the Rockingham County GIS |
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 The Rockingham County GIS (geographic information system) is run by InteractiveGIS and they pointed out a fun feature to me recently... In a nutshell, you can select a bunch of parcels (properties) in the GIS and export those property lines from the GIS and then import them to Google Earth! The image above is the result of this export and import process. Now, you might note that the GIS already allows you to see an overlay of property lines on top of an aerial image -- but moving the property lines over to Google Earth allows you to have a 3D view with property lines -- and to interact with it, zooming and panning, and doing all the fun things you can do in Google Earth...  Here's how to do this, in a nutshell... Rockingham County GIS
Google Earth
Give it a try and let me know if you need help making use of this cool functionality in our local (Rockingham County) GIS. | |
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City of Harrisonburg Home Sales Slow But Prices Rise |
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 Focusing in just on the City of Harrisonburg for a moment... Home Sales Slow -- There have only been 379 home sales in the past 12 months in the City of Harrisonburg, as compared to 423 home sales in the previous 12 months. This is a 10.4% year-over-year decline in home sales activity in the City. Prices Rise Sharply -- The median price of the homes sold in the past 12 months was $215,000 which is 13.22% higher than one year ago when it was $189,900. What does it all mean?
Are you looking to buy, or sell, in the City of Harrisonburg? Feel free to touch base with me if I can be of any help to you. You can reach me at scott@hhtdy.com or via phone/text at 540-578-0102. | |
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Harrisonburg vs Rockingham County Inventory Levels |
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 Perhaps the City inventory levels were just so low that they didn't have far to fall? Multiple things to note here (above) regarding City vs. County inventory levels...
In theory, inventory levels might (???) start to climb a *bit* this fall, but my general sense is that there is still pent up buyer demand and inventory levels could stay this low all through the fall and winter. Sorry, buyers! :-/ | |
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Local Home Sales, Contracts, Prices Surge In Summer 2020 |
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 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...
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...
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
SELLERS
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! | |
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Welcome to The Townes at Congers Creek! |
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 Welcome to The Townes at Congers Creek! Construction is beginning on brand new, upscale townhouses with garages are located off of Boyers Road, just minutes from Sentara RMH Medical Center, in the Cub Run Elementary school district. These beautiful townhouses will feature a large living room with plenty of natural light, an eat-in kitchen with a large island, Shaker Style cabinetry, stainless steel appliances, and three bedrooms and two full bathrooms. Enjoy nine foot ceilings on the main level, a master suite with walk-in closet, a single car garage and an unfinished bonus room behind the garage, with a roughed in bathroom, that would be perfect for a home office. Here is the layout of the neighborhood...  Find out more about these new townhouses by visiting CongersCreek.com. FYI - I am listing and marketing these townhouses, along with Suzanne Trow and Carey Keyes. | |
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When The House Purchase Price Is Not The Whole House Purchase Price |
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 A first time buyer looking to buy a detached home (not a townhouse or duplex) under $225K might find themselves considering mostly homes that are at least 50 years old. Said buyer might find the **perfect** home built in 1945 that is "move-in ready" with pretty paint on the walls, and beautiful furnishings, and a well-kept garden, and a quaint covered front porch, and on and on. This buyer is likely head-over-heels excited about the house at this point, as it is priced at $230K, just barely above their target maximum of $225K. But before the buyer signs that contract to make an offer on the house they should probably pause at least for a moment to ask some questions and to consider...
There are plenty of other items that might need updates or replacements in the next three years, but they are all either of a lower cost or elective - though these costs could also add up:
But circling back to the first two items - the roof and heating system - these are pretty much non-negotiable. If either quits working as it should, you'll need to replace it. And if you're maxing out your housing budget with a $225K-$230K home purchase, and then within a year or two you need to spend $8K - $15K on a roof and $8K - $15K on a heating system, that will likely create some financial stress for you. | |
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Only 1 in 10 Home Buyers Spends More Than $400K |
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 Lots to observe / conclude 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 (maybe 75) of strong buying activity (contracts being signed) during September and October before things start to slow down in November - and then really slow down in December and January. 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 price next Monday -- on September 7th -- you likely have a good 60 - 75 days of exposure to a larger pool of buyers before contract activity slows down. If you wait, and reduce your price on November 15, you have already had a large number of buyers pass your house by - and we'll be rolling into Thanksgiving and then Christmas. 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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Home Buyers Went Bananas In August 2020 |
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 A little later this month I'll take a thorough look at all of the home buying (and selling) activity in Harrisonburg and Rockingham County. But before we get there - I thought I'd take a quick peek at how many buyers (and thus, sellers) signed contracts in August 2020. I was surprised to see a BIG increase in August contract activity as compared to the month of August in each of the past four years! Buyers still seem to be out in full force, ready to pursue houses as they hit the market for sale. It seems this fall might be busier than usual in our local housing market! | |
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There Are Not Necessarily Always Buyers For All Homes Ready To Buy At All Times |
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 If you are preparing your house well for the market - and pricing it appropriately, according to what other buyers have recently paid for similar houses - and the house is marketed fully and professionally...it should be under contract relatively quickly, and certainly within the first 30 days, right? Well... maybe... Sometimes, it just takes time. In the end, if the right buyer is not in the market right now, then it might not sell until the right buyer is ready to buy - and we shouldn't necessarily expect that the wrong buyer will buy your house just because it is prepared well, priced well and marketed well. Understanding how these dynamics will affect you and your listing is highly related to how many buyers are in your price range -- and in that pool of buyers in your price range, is your house likely to meet the needs of only a few, many or most of the buyers. So, if your home has been on the market for 30 days, or 60 or 90 or 120 or more days -- we should be thinking about...
If the answer is yes, yes and yes -- then we'll be left with two options...
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How Should A Home Seller Actually Interpret Buyer Feedback? |
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 As a home seller, if you didn't get a contract within a few days of your house being listed for sale, you may continue to face rejection left and right -- some 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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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
Licensed in the
Commonwealth of Virginia
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