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Home Sales Steady in 2022, Prices Still Rising Quickly! |
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 Happy Thursday morning, friends! It's definitely spring in the Valley (cool mornings, warmer afternoons, lots of rain, lots of sun) and spring is a busy time for many! Busy times in the Rogers household these days include college visits with Luke, baseball games for Luke and track meets for Emily...  Whatever has you running around this spring, I hope you are enjoying all that this season in the Shenandoah Valley has to offer and are finding opportunities to spend time outdoors (ok, or indoors!?) with family and friends. Before I get started on this month's market report, a few notes.. My Favorite Spots... Each month in this space I highlight one of my favorite spots to enjoy a meal, a cup of coffee, or as with this month, an experience. One of my favorite summer experiences is heading down to Natural Chimneys Park in Mt Solon for great music in the great outdoors at the Red Wing Roots Music Festival... a super relaxing and family friendly music festival featuring 40+ musical artists on five stages over three days, with great food, and activities for all, including camping, fun runs, bike rides, yoga, dancing and much more! Have you considered going to Red Wing but perhaps haven't been yet? Maybe this summer is the time for you to make it one of your favorite family traditions. I am looking forward to being there with my family and I'm hoping you'll join in on the fun... from June 24th through 26th. If you're interested in going to Red Wing, and haven't purchased your tickets yet, I'm giving away a pair of three-day general admission tickets. Click here to enter! I'll pick a winner in about a week. If you don't win, you still better come to Red Wing... and you can buy tickets here. Download All The Charts & Graphs... Looking for ALL the numbers and charts and graphs? Download a full PDF of my market report here. Now, then, let's take a look through some of the graphs together to see what we can learn...  Above you'll find many of the main market metrics I'm evaluating each month and there is plenty to note this month, with my notes below lining up with the numbers above... [1] We saw quite a few more sales this April than last April.. After only 120 last April, there was a 17.5% increase this April. As you may recall, March home sales were a bit slow this year, which caused some to wonder if the market was cooling off. Well, maybe it's not ready to cool off yet because April sales were hot, hot, hot! [2] Looking back at the first four months of the year there have been 450 home sales, compared to 447 sales during the same timeframe last year. Thus, home sales activity is tracking very similarly to how things looked a year ago. [3] If we broaden our view a bit more, to a 12-month window, we'll find that there have been 1,675 home sales over the past 12 months... compared to only 1,572 in the 12 months prior to that. Thus annual home sales activity has increased 6.55% over the past year. [4] The changes in sales prices over the past year is still somewhat staggering. The median price in the first four months of 2022 is 18.6% higher than it was in the first four months of 2021! [5] Again looking at a longer timeframe, the median sales price over the past 12 months has been 12% higher than during the 12 months before that. Sales prices are increasing quickly in our area! [6] Homes are selling faster, and faster, and faster yet. The median days on market over the past year has been five days, which is 29% faster than the seven day median in the 12 months before that. Wow! So, about the same number of homes are selling as last year... but at much higher prices... and more quickly! These quickly rising prices have caused to market metrics to pop over major (psychological) thresholds over the past 12 months...  [1] A year ago, the median sales price of a detached home was under $300K... at only $276K... and now it has risen above $300K to $309K. That is to say that half of detached homes that are selling in Harrisonburg and Rockingham County are priced at or over $309K. [2] A year ago, the median sales price of attached homes was under $200K... at only $196K... and now it has risen above $200K to $235K. That is to say that half of the attached homes that are selling in Harrisonburg and Rockingham County are priced at or over $235K. The times, they are a changing! Prices keep rising! Diving back into the details a bit, April was another surprisingly strong month of home sales...  The 98 home sales seen in February 2022 was a surprising jolt of energy for the early 2022 housing market, but then things cooled off a bit in March... or so it seemed. Come April, the buyers were back, and the monthly market activity was once again surprising... with 141 home sales, well above the monthly sales in April of each of the past three years. That extra burst of home sales in April caught 2022 back up with 2021...  Year-to-date home sales through the end of March 2022 (dark red bar) had fallen a bit behind where things were a year ago at the end of March 2021. But, then, enter April 2022. A strong month of home sales in 2022 pushed this year back ahead of last year when looking at the first four months of the year. Repeating the 1,672 home sales seen last year still seems like a might feat for 2022, but it is still seeming quite possible after four months of sales activity. Of interest, as it relates to home sales activity, it does seem that we have come to the end of the line of ever increasing numbers of home sales in our area...  From the start of Covid in mid-2020 to the end of 2021, we saw a rapid increase in the number of homes selling on an annual basis with that figure steadily increasing from 1,300-ish to 1,650-ish. Now, over the past nine months, we have seen the annual pace of home sales largely holding steady around 1,650 to 1,675 home sales per year. It seems unlikely that we will see another strong increase in the annual pace of sales, but it seems equally unlikely that we will see a rapid decline in the number of home sales in Harrisonburg and Rockingham County. Bouncing back to prices... which keep soaring higher and higher...  Here's a tidbit for you to share with a friend, relative or neighbor the next time you are talking about the crazy local real estate market... The median price of a single family (detached) home has increased by over $100,000 over the past... five years! That's rather astonishing. Just five years ago, the median price of a single family home was only $225K... and now it is up to $335K! Starting to look ahead now, let's examine contract activity...  Contract activity (as shown above) is a funny thing. In theory, it measures when buyers made decisions to buy homes... but in times of low inventory (as in, now) contract activity has just as much to do with when sellers are ready to put their homes on the market. Few sellers selling = few buyers buying. No sellers selling = no buyers buying. That said, a year ago (in April 2021) there were 151 contracts signed on homes in Harrisonburg and Rockingham County and in the month that just concluded (April 2022) we saw... 150 contracts signed. So, despite the monthly ups and downs that always do occur, we still seem to be pretty much on track in 2022 with how things were progressing in 2021. Looking ahead, it seems likely that we'll see around 140 to 160 contracts per month over the next four to six months. Now then, about those sellers and whether they are ready to sell...  After quite a few years of inventory levels tumbling downward, it seems that things may have finally leveled off at an equilibrium of around 130 homes for sale in Harrisonburg and Rockingham County. This is only somewhat of a relief... it's great that inventory levels aren't dropping further, but these current inventory levels still aren't doing buyers any favors. In many or most price ranges and neighborhoods there is nothing or next to nothing available for sale at any given time. For buyers to feel like things are improving, at all, we'd need to start to see a bit more inventory staying on the market at any given time. We're not there yet. Going hand in hand with very low inventory levels is the speed at which homes are going under contract...  Indeed, as noted above, if your home has been on the market for more than a month... and is still not under contract.... hmmm.... Right now, 82% of homes (that sell) are under contract within 30 days, and 91% are under contract within 60 days! The market is moving quickly, so if your house isn't moving quickly then you should have a chat with your Realtor to understand why. This next metric also looks at median days on the market, and I think it will be the first metric to start shifting if or when the market starts to soften a bit...  Over the past 12 months, the median "days on market" has been five days... and the market has been moving that quickly for almost a year now... since last July. At some point we will likely see the speed of the market start to slow down a bit... and that will be OK! If the median days on market of sold listings crept back up to seven days, or even (gasp!) ten days... the market would likely still (!!) be tipped in favor of sellers. But, despite talk of possible softening or deceleration of the market... it doesn't seem to be happening yet. And here is why some are thinking the pace of housing market activity could start to slow down a bit...  After quite a few years below 4% (and even below 3%) the average mortgage interest rate has quickly risen over the past seven months... from right at 3% to just over 5%! This can make a significant difference in the monthly payment that buyers will have to pay on their mortgage... so it has a good chance of impacting the amount of buyer interest in various houses at various price points. We haven't seen an overall market slowdown yet as a result of these rising rates, but it seems quite possible that if interest rates continue to rise we will see buyer enthusiasm dampen a bit. And with that... we reach the end of my monthly ramblings about the state of the local housing market. I hope the graphs above and my reflections herein have helped you have more clarity on the current happenings in our local housing market. Before signing off, a few reminders... [1] Make plans to attend the Red Wing Roots Music Festival this year. You won't regret it! Enter to win a free pair of three-day general admission tickets here. [2] If you are planning to sell your home, or move, or buy a home, this spring or summer, let's chat. I can swing by your house or we can start with a brief conversation by phone or email. Call or text me at 540-578-0102 or email me here. That's it! I hope the balance of your month of May goes well. Touch base anytime if I can be of any help to you or your family, friends or co-workers or colleagues... with real estate or otherwise. 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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