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2021 Year In Review in the Harrisonburg Area Real Estate Market |
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 Happy New Year, Friends! I hope you had a delightful, relaxing, fun and healthy holiday season and New Year celebration. Today I am coming to you with a "year in review" of the Harrisonburg area real estate market in 2021. Before we get started, though, I'll introduce you to the sponsor of this month's market update. ;-) This month's market update is brought to you by... cookies!!!  A delicious part of our family's holiday celebration is the annual Christmas Cookie Contest and this year there were some fantastic entries! The photo above actually only shows six of the ten cookies from this year's 19th Annual Christmas Cookie Contest - and it does not show the winning cookie - congrats, Aiden! As you reflect back on your holiday celebrations, I hope you are reminded (as I am) of plenty of delicious food, and even better... wonderful, cherished time with family near and far! Now, though, let's dive into some real estate data to better understand how exactly the year wrapped up in the Harrisonburg and Rockingham County real estate market. For those that like to check out every graph, even those not in this narrative summary, download the PDF with all the graphs here.  The chart above quickly gets us into the big picture for our real estate market. First (1) you'll see that home sales ticked upwards a bit in December with a 1.46% increase over December 2020. But the numbers you've all been waiting for are shown as 2, 3 and 4 above... Home Sales Increased 11% in 2021. Sales Prices Increased 10% in 2021. Time On The Market Decreased 44% in 2021. So, a rather strong year for our local housing market! It was a fast paced market, with homes usually going under contract in less than a week. We saw more sales than in 2020, and prices were (as noted above) 10% higher in 2021 than 2020. I do think, however, that slicing and dicing this overall data a bit can be helpful. Let's first break it down by detached vs. attached, and then by City vs. County. Here is a summary of 2021 sales of detached homes...  As shown above, there was an almost 8% increase in the pace of detached home sales in Harrisonburg and Rockingham County in 2021. This increase (8%) is slightly less than the overall market-wide 11% increase, meaning that a greater share of the increase home sales were of attached homes. The median sales price of detached homes in 2021 was $291,500... up 8% over the median of $269,000 in 2020. A few thoughts here... first, the 8% increase in the median sales price of detached homes is less than the overall market-wide 10% increase, meaning that the sales prices of attached homes must have *really* increased in 2021. Stay tuned for that. Secondly, it is pretty wild to see the median sales price of a detached home now approaching $300,000. That means that in 2021, only slightly fewer than half of home sales were over $300,000! Now, then, about those attached homes, which includes townhouses, duplexes and condos...  Indeed, as predicted above... The pace of attached home sales increased more than that of detached home sales and more than the market as a whole. There were 20% more detached home sales in 2021 than we saw in 2020! The increase in the median sales price of these attached homes also increased much more in 2021 than the median price of detached homes. The median sales price of an attached home increased 17% from $193,000 to $225,000 in all of Harrisonburg and Rockingham County! So, half of buyers paid more than $225K for a duplex, townhouse or condo in 2021! Now, looking a bit more closely at the City vs. the County...  Despite seeing very few homes on the market for sale in the City at any given time through most of 2021, we managed to see a rather large (!) increase in the number of City homes selling in 2021. After only seeing 416 City home sales take place in 2020, there were 24% more in 2021... with a total of 514 home sales. Despite this significant increase in the number of City homes that sold in 2021, we actually only saw a 3% increase in their median sales price. The median sales price of City homes selling in 2021 was only $225,000. This is somewhat striking in comparison to the market-wide (City + County) median sales price of $270,000. So, then, how about the County?  Over the past year we actually saw a smaller increase in the pace of home sales, with only 7% more home sales in 2021 than in 2020. The median sales price of those County homes increased quite a bit more, though, with an 11% increase in the median sales price -- which moved up from $254,000 in 2020 to $281,000 in 2021! So, the pace of home sales increased more in the City than the County -- but the median price of those home sales was higher in the County than the City -- and that median price increased more, year-over-year, in the County than the City. Do what you will with that newfound comparative understanding of our local housing market. ;-) Next, looking at one of my favorite monthly graphs, the pace of monthly sales seemed to be just as chaotic as many of the other constant changes in our lives in 2021...  Monthly home sales were *anything* but predictable in 2021. They bounced all around, jumping to record new highs, usually followed immediately thereafter by surprising lows. The market seemed to want to take an "every other month things will be crazy" approach to the timing of sales through out the year!? And what if I told you that the market "slowed down" in 2021?  Yes, yes, I know, it's a bit of a stretch. Home sales rose 11% in 2021, so that's not really slowing down, right? Right. But... home sales increased 13% in 2020... and only 11% in 2021... soooo... slowing down, right? ;-) That's probably not an objective characterization of the market. By all accounts, the market sped up in 2021, even if the definitely-faster-than-normal acceleration was slightly slower than in 2020. We'll go with that. Looking now, at detached home sales trends on a graph...  When looking at detached home sales only: The pace of detached home sales increased 8% in 2021... after having increased 9% in 2020. The median price of detached home sales increased 8% in 2021... after having increased 12% in 2020. So, maybe flattening out, barely, slightly, slowly? Or maybe not. And how about the attached home sales market?  When looking at attached home sales only: The pace of attached home sales increased 20% in 2021... after having increased 22% in 2020. The median price of attached home sales increased 17% in 2021... after having increased 10% in 2020. Right, so, in such a strong seller's market are sellers having to negotiate much?  We'll say "nope" -- sellers are decidedly NOT negotiating much, at all! Half of buyers paid 100% or more of the list price of the house that they purchased in 2021... following the same trend as in 2020! So, unless a house is obviously overpriced, and perhaps has been on the market for weeks or months, you likely won't be negotiating much if any as a buyer. Sooooo much buyer interest and activity has lead to inventory levels falling, and falling and falling...  We are now experiencing (and have been for the past year) the lowest inventory levels I've ever seen. There are currently only 119 homes on the market in all of Harrisonburg and Rockingham County, which is 39% fewer options for buyers (at any given time) than where we were just two years ago! Which is probably why listings are going under contract SO quickly...  A whopping 81% of all houses that sold in 2021 went under contract in the first 30 days of being listed for sale. And as mentioned earlier, the median is five days... so half of properties sold are going under contract in five or fewer days. Speedy!  Visualized slightly differently, the graph above shows the annual trend in median days on market... so... homes have been going under contract faster and faster and faster over the past year and a half. It doesn't actually seem that they can go under contract any faster than they are now. If or when the market starts to slow down, we'll likely see it first in a change in this metric of how quickly homes are selling. Finally, did you hear mortgage interest rates are rising?  Ha ha, sort of, kind of, but not meaningfully. Mortgage interest rates stayed below 3.25% for the entirety of 2021! This is so low in any historical context, that an increase over the past six months from 2.8% to 3.1% is not overwhelming or concerning to most buyers. As shown above, the average mortgage interest rate was actually at or below 3% (!) for most of the year! And... just like that... we have reached the end of my recap of the 2021 housing market in Harrisonburg and Rockingham County. Do you have questions about this data or these graphs? Or do you have questions that this data and these graphs did not answer? Ask away... just reply to this email! Finally, if 2022 will be the year that you hope to buy or sell a home, let me know if I can be of help to you with that process. I'd be delighted to work to help you accomplish your goals of buying or selling this year. Just reach out by email, phone or text (540-578-0102) and we can set up a time to meet to discuss your dreams, goals and timing! Now, go find that snow shovel and start doing some stretches to prepare for some extended shoveling time... they're now calling for 11 inches of snow for the Harrisonburg area on Sunday! Recent Articles:
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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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