The median sales price five years ago (2015) was $185,000 in Harrisonburg and Rockingham County.
Last year, five years later, it was $244,900.
That's a 32% increase in the median sales price over five years!
A variety of thoughts come to mind...
- First, a happy thought, for some. It has certainly been a great time to be a homeowner. If you have owned a home for the past five years the value of that home has likely increased quite a bit. That value certainly isn't guaranteed to always go up -- and it definitely won't usually go up this quickly -- but this has been a good five years during which to own a home.
- The monthly payment (principal and interest) for financing 80% of that median priced home has only increased by 13% during that same timeframe - due to mortgage rates declining from 3.96% (in 2015) to 2.67% (now). So if you didn't buy five (or four, or three, or two, or one) years ago your mortgage payment today will not be 32% higher than five years ago even if the price is 32% higher.
- If you have been thinking about buying a home for the past few years, but have not done so, these increases in prices are likely quite depressing. The lower rates and thus lower monthly payments are somewhat of a consolation - but it still is not that fun to see that you have to pay a higher and higher price for the same home year after year. But, that's the market these days.
- If you fall into the category above (thought about buying but haven't) and you're feeling rotten about how much you'd have to pay for a house today - you have an interest choice in 2021. Do you just go ahead and buy a house even though you can't believe how much you have to pay for it? Do you keep waiting, wondering if prices will come back down in the future?
- While lower mortgage interest rates have kept housing payments for new buyers more affordable despite rising home prices, that could all change if interest rates start to increase significantly. That is not currently predicted for 2021, but it seems that eventually rates will have to start going up?
That's all from me, for now. If this 32% increase in prices over five years seems shocking, or depressing, or awesome to you -- drop me a line (
scott@hhtdy.com) and let me know what you're thinking or how you're feeling about these changes in home values in our area.
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