Analysis
Newer Posts | Older Posts |
![]() |
![]() |
Are Realtors Too Optimistic? |
|
I have been cautiously optimistic about the real estate market improving for almost four years now. Each year, instead of improving, the market declined. So -- would you like to know what I am predicting for the upcoming year in the Harrisonburg and Rockingham County real estate market? I am cautiously optimistic that things will start to improve. Hmmmm........ Now, of course hindsight is always 20/20, but check out my comments back in January 2008 (a bit over 3 years ago): Preparing for the 2008 Real Estate Market "As 2007 progressed, sales increased, and inventory levels decreased. In most price ranges, there is still somewhat of an oversupply of housing – but this will likely continue to correct itself in 2008. As we move through the first quarter of 2008, expect to see a continued gradual increase in the number of sales, and a continued gradual decrease in the inventory of available homes. The continuation of both of these trends will restore a healthy balance between buyers and sellers in our market." Was a healthy balance in the market restored in 2008? No. Things became worse. And then worse yet in 2009. And then worse yet in 2010. So where IS the real estate market headed in 2011? I believe the market will start to incrementally improve this year --- but again, I have thought that for years now, without my beliefs being born out in market realities. And yet as I look to the future and provide projections and predictions to my clients I try to strike a balance between totally unrealistic optimism and totally depressing pessimism. Let me know sometime whether you think I'm striking an appropriate balance: scott@HarrisonburgHousingToday.com | |
![]() |
![]() |
![]() |
![]() |
How Do Virginians Heat Their Homes? |
|
Have you ever wondered how Virginians heat their homes? The Market Leaders Over Time: Coal......Oil......Electric ![]() And for the graphically inclined.... ![]() Source: U.S. Census | |
![]() |
![]() |
![]() |
![]() |
March 2011 Home Sales Set New Record |
|
Bill Meadows, a new resident of Dayton, Virginia, holds a distinct honor -- he was the only person to buy a home anywhere in Harrisonburg or Rockingham County during March 2011. ![]() As shown above, January and February sales were quite low, but most people were expecting that we would see a rebound in Harrisonburg and Rockingham County home sales during March 2011. Alas, we did not, as only one person (Bill Meadows) bought a home during the entire month of March. Most analysts are hoping for stronger sales in April, to at least hit the double digits. "I was quite surprised to find out that I was the only one to buy a house this month," Bill commented, "I was pretty sure I had heard several co-workers and friends also talking about buying a home this month." Home sellers are trying hard to keep this in perspective but some sellers, such as Sally Peters, are having difficulty staying calm about this new development. "With only 1 home sale last month, and 821 active listings, that shows a 68 year supply of homes on the market," Sally explained, "Since I'm already 52 years old myself, I am obviously a bit concerned that it might take 68 years to sell all of the houses on the market. I might be over 100 before my home sells!?!" Stay tuned for a full report on the housing market in roughly a week, until then, watch for additional details on these breaking stories:
| |
![]() |
![]() |
![]() |
![]() |
Fortune Magazine: It Is Time To Buy Real Estate Again |
|
Fortune Magazine makes some bold predictions after LOTS of detailed analysis.... ![]() Click on the image above (or here) for a PDF of the entire article, which deserves a careful read. To entice you to read the entire article, consider the following excerpts....
| |
![]() |
![]() |
![]() |
![]() |
If (When) You Can't Find A Perfect Home |
|
Even when there are plenty of homes for sale, some (or many?) buyers won't be able to find "the perfect house" -- even after looking at a lot of houses. What is a buyer to do? ![]() Some would say every buyer must compromise on some aspects of the house they are searching for. Above you can see that a full third of home buyers responding to the National Association of Realtors research methods did not consider themselves to have compromised at all in their home purchase. From there, we jump down to size and price of the home, followed by condition. The areas where buyers were unwilling to compromise included items such as schools, neighborhood and distance from family and friends. Where would you prefer to compromise as a buyer? | |
![]() |
![]() |
![]() |
![]() |
How Do 2011 Home Sales Stack Up To 2010 Home Sales? |
|
![]() The graph above shows the cumulative number of home sales having occurred as we moved past each of the first 83 days of this year (as compared to last year). As you can see, we were doing well through the end of January, but the gap started to widen slightly through February, and more significantly through March. Due to the first time home buyer tax credit, we may see the gap widen even further in April, though hopefully we'll have some strong summer months of sales to keep us relatively on pace with 2010 home sales. | |
![]() |
![]() |
![]() |
![]() |
What Portion Of Homes For Sale Are Under Contract? |
|
Contracts have been strong over the past several months, but what has been going under contract? By the numbers, the following is the break down of the properties currently under contract:
![]() The graph above, however, shows how the number of properties under contract in each price range compares to the total number for sale. A few observations:
| |
![]() |
![]() |
![]() |
![]() |
Big Picture Real Estate Predictions |
|
![]() Am I being reasonable in these predictions? Change in number of single family home sales:
| |
![]() |
![]() |
![]() |
![]() |
Do most homes have bedrooms on the first floor? |
|
Apparently this varies by region --- in a conversation earlier this week someone was sharing with me that in each part of the country where they had lived, it was a bit different. In one part of the country, nearly every home had a bedroom on the first floor. In another part of the country, only a very small number of homes had a bedroom on the first floor. What is your guess for Harrisonburg and Rockingham County? 64% of currently available single family homes offer a bedroom on the first floor! This was a bit surprising to me, as I assumed it might be less than half of all homes. I will often have buyer clients that are requesting this feature in a home and it seems to limit their options --- but apparently not too significantly. Breaking it down by price range, there also isn't much variation:
49% of currently available multi-level single family homes offer a bedroom on the first floor! Looking just a little bit further, let's examine whether there is a difference in "sellability" of homes with vs. without a bedroom on the first floor. When examining multi-level homes sold in the last year:
Are you considering buying a home, or building a home? Do you have questions about what you should be looking for or avoiding in a house? I'm happy to share my opinion, or the facts as shown by home sales data. Call me at 540-578-0102 or e-mail me (scott@HarrisonburgHousingToday.com) and we can discuss your situation. | |
![]() |
![]() |
![]() |
![]() |
Why is the median price of townhomes holding steady? |
|
It's rather puzzling. Despite fewer (and fewer) townhome buyers, prices are holding relatively steady.... ![]() One of my clients hypothesized that perhaps prices are holding steady because the townhomes that buyers are actually buying these days (2010/2011) are new townhomes, and are thus worth more. To test this theory (which I definitely agreed with) I examined the median age of the townhomes that sold for each year between 2006 and 2010.... ![]() Based on the information above, it doesn't seem that townhomes are holding steady in price because buyers are just buying new townhomes these days. In fact, the reverse is true, more of the townhomes purchased 4 and 5 years ago were new than of those purchased in 2010/2011. Examining the data from another perspective, I thought I'd check the percentage of the townhome market that is made up of sales of new townhomes.... ![]() Again, the data shows that fewer and fewer (proportionally) of the townhomes being purchased are new townhomes --- thus the theory that prices are holding because newer townhomes are what is actually selling does not seem to hold true. So, what could it be? Any other theories that I can test? Why are townhome values so resilient in Harrisonburg and Rockingham County? | |
![]() |
![]() |
![]() |
![]() |
How Far Have Home Prices Retreated? |
|
Thank goodness we experienced huge gains in home values between 2000 and 2006, because values have been steadily retreating since that time. Harrisonburg and Rockingham County are not in a unique situation in seeing a decline in home values (as measured by median sales prices) over the past five years (2006-2011). In fact, many areas of the state and our nation saw much more significant declines in home prices during the past five years. How far, though, did we retreat into the past with this decline of home values? ![]() When examining single family homes and townhomes together (above), you'll note that the current median sales price (2011 year-to-date) of $166,000 marks a retreat back to 2004/2005 home values. ![]() Single family home values (median price 2011 year-to-date = $175,006) have also retreated back to 2004/2005 levels. ![]() Despite drastically low sales thus far in 2011, townhomes have fared better than the detached home market. Median sales prices of townhomes (2011 year-to-date = $158,000) have only retreated back to 2005/2006 levels. What does the future hold? I have long held to the prediction that we will not see an increase in median home values until the pace of home sales stabilizes and starts to increases again. Last year there was only a 1% decline in the number of single family homes in Harrisonburg and Rockingham County, so I am hopeful that 2011 may be the year that we see a stabilization in the pace of home sales, even if it is not until 2012 that value start to stabilize. | |
![]() |
![]() |
![]() |
![]() |
Home Sales Down, Prices Down, Is There A Silver Lining? |
|
Despite many negative indicators in our local housing market, there may be hope for better news in the coming months. Click here to view a PDF of my most recent market report on the Harrisonburg and Rockingham County Real Estate Market, or read on for several excerpts.... ![]() As can be seen above, sales have dropped significantly as compared to a year ago -- both in February alone (28% decline) and in year-to-date figures (21% decline). Furthermore, we continue to see declines in both median sales prices (3% decline) and average sales prices (2%). As would be expected, this has lead to an increase (21%) in the time it takes to sell a house. ![]() Above you will note that January home sales (39) were roughly equivalent to previous years' January sales. February 2011 home sales however (38) were significantly lower than February sales in 2008, 2009 and 2010. Thus far, the trend line for 2011 home sales is headed in the wrong direction -- if you're one of those people who likes to see positive improvement.! ![]() The pace of home sales has declined steadily for three years (orange line above), as has the median sales price in this area (green line above). Of note, the median sales price has actually stabilized and increased somewhat over the past six months. ![]() Above (in red and blue, instead of silver) is the silver lining of this month's housing market report. Buyers were out in full force in February 2011 --- with a full 69 properties going under contract. This marks a 44% increase over February 2010, which should lead to strong sales figures in March and April. ![]() There's plenty more news in my monthly housing market report -- click on the image above (or here) to download and view the full PDF. As always, if you have questions about this report, or if I can be of assistance with real estate that you own, or that you'd like to own, please be in touch. You can reach me most easily at 540-578-0102 or scott@HarrisonburgHousingToday.com. | |
![]() |
![]() |
![]() |
![]() |
Home Buyers Show Up in Force in February 2011 |
|
![]() 69 properties went under contract in Harrisonburg and Rockingham County last month (February 2011) --- showing a 53% increase over last February. Moving beyond this startling good news, the question becomes (for many of my clients) what was it that actually sold in February!? Contracts by Price Range:
| |
![]() |
![]() |
![]() |
![]() |
Harrisonburg and Rockingham County Population Grows 15.77% from 2000 to 2010. What does it mean for the housing market? |
|
![]() The housing market in Harrisonburg and Rockingham County was relatively normal in 2000 (as best as I understand -- since I started selling real estate in 2003). Given that the population in Harrisonburg and Rockingham County grew 15.77% between 2000 and 2010, what would have happened if real estate sales had tracked on that same path? ![]() The red bars above show the actual pace of sales between 2000 and 2010. The blue line shows a straight line increase in sales assuming an overall sales increase of 15.77% between 2000 and 2010 to mirror the population growth. As you can see, if we assumed that the same portion of the 2000 population would buy homes in 2010, then the actual home sales last year were lower than they "should have been." My conclusion? Time will tell whether 2011 will show an equivalent (or higher) number of sales to 2010, but I believe in one to three years we will see higher total home sales in this area than we experienced last year. I don't believe the 758 home sales in 2010 should be considered the new norm. Per the 15.77% growth between 2000 and 2010, we should see, or could see, or might see, a pace of new normal home sales pace in the next few years around 960 home sales per year. | |
![]() |
![]() |
![]() |
![]() |
Sales Growth and Decline Vary Significantly By Area |
|
Over the past year our local real estate market has been relatively stable (only a 1% decline in single family home sales) but it turns out that the changes in market activity have varied quite significantly by location. ![]() As you can see above, despite overall stability several areas saw continued decline in sales:
| |
![]() |
![]() |
![]() |
![]() |
Where have all the listings gone? Long time passing... |
|
As referenced a few days ago, the inventory of listed homes in Harrisonburg and Rockingham County has dropped significantly (by 23%) over the past six months. But as Pete Seeger might ask... where have all the listings gone? ![]() It turns out the listings expired. Take a look at the huge chunk of listings that expired during each of the past four months (Oct, Nov, Dec, Jan) -- each is a red bar with a star in it. As long as those late-2010 expired listings don't turn into early-2011 new listings, the market might stand a chance of heading towards more stability. Stay tuned! For the analytical minds amongst us, a few notes about the data:
| |
![]() |
![]() |
![]() |
![]() |
Mixed Signals From January Housing Market Activity in Harrisonburg and Rockingham County |
|
My most recent market report (excerpts below, full report here) shows a variety of mixed market indicators when examining market data through January 31, 2011:
![]() Home sales in January 2011 (39 sales) were down compared to the 45 sales in January 2010 -- but up compared to the 37 sales in January 2009. This is a relatively even start for 2011, and if the past three years are any indicator, we'll have around 50 home sales in February. ![]() This graph shows a rolling 12 months of home sales -- and you can see that the annual pace of home sales has been declining for several years other than the temporary respite offered by the home buyer tax credit last year. The last several months, however, seem to be offering some leveling out of this indicator. ![]() Buyers were out in full force in January 2011 -- 62 properties went under contract. This is an increase over January 2010 (59 contracts), an increase over January 2009 (43 contracts) and an increase over last month (40 contracts). This could be a strong spring market. ![]() Perhaps due to a small sample size, the median sales price continues to decline in January 2011. ![]() We are currently seeing the lowest inventory levels that we have seen over the past two years. This can help the market to stabilize, unless the market is flooded with listings in March and April. ![]() Click the image above (or here) to read the full report. If you have questions about this report, or if I can be of assistance with real estate that you own, or that you'd like to own, please be in touch. You can reach me most easily at 540-578-0102 or scott@HarrisonburgHousingToday.com. | |
![]() |
![]() |
![]() |
![]() |
What are your predictions for the local real estate market in 2011? |
|
What do you think? Will the real estate market be getting better in Harrisonburg and Rockingham County during 2011? Could it get any worse? One of my predictions can be found here. One (of many) indicators that I monitor is how many people are using our company web site and agent web sites. ![]() The meaning of this data is not immediately clear to me --- because there is a near constant increase in web site usage over the past twelve months. I expected to see much more seasonal variation in this metric. Web traffic did dip down slightly in October 2010, which would make sense if more people were looking for properties during the summer months. The big shock, however, is that buyers seem to be out (online at these web sites) in large numbers right now. Even if these interested buyers aren't all turning into active buyers, it is exciting to see that there has been so much activity in December and January. So.....what are your predictions for the local housing market in 2011? | |
![]() |
![]() |
![]() |
![]() |
Home buyers are probably getting GREAT deals these days, right? |
|
In a lot of ways, they are --- but it's not as extreme as you might think. After observing several houses go under contract at fantastic prices I was pondering aloud that it seemed that finding the right price would make buyers appear . . . because you'd be offering them a great deal. That prompted someone to ask me about current price per square foot prices for houses --- and whether buyers were getting great deals these days. Thinking about one of the houses that had recently gone under contract, I commented that yes, houses are DEFINITELY selling at GREAT price per square foot rates. That will teach me to make a broad statement based on one or two data points. This evening I dove into the data to take a closer look --- and to confirm what I was quite sure to be true. To get the best possible sense of the deals buyers are getting these days on a price per square foot basis, I decided to narrow down the sold properties I was examining. If I examined all properties of a variety of sizes and ages, there would be so many variables at play that it would be hard to draw any conclusions. Here's how I limited my two sample sets of data:
My second data set examined homes matching the same criteria that sold during 2010 -- there were 35 such homes, and they sold at an average of $111/sf. Hmmmmm......$4/sf better than a year ago.....is that a great deal for a buyer? That provides a $8,000 savings on a 2,000 square foot house. Instead of buying the house for $230k (in 2009) you'd have paid $222k (in 2010). That doesn't seem like an extraordinary cost savings to buyers --- so perhaps in the aggregate buyers aren't getting amazing deals now (compared to a year ago), even though they are getting slightly better deals. Examined one other way, 26% of these houses sold for less than $100/sf in 2009......and in 2010, 29% sold for less than $100/sf. So, it seems that while there are some isolated AMAZING DEALS in the current real estate market, you probably won't be able to get a FANTASTIC DEAL on EVERY house that's out there. But, of course, every seller trying to sell their house right now would like me to remind you that:
| |
![]() |
![]() |
![]() |
![]() |
Has the real estate market (finally) hit bottom in Harrisonburg and Rockingham County? |
|
I say yes --- but do bear in mind, I've thought this a few times before. I recently realized that the overall trend I examine in my market report each month (total number of residential sales) might not be the best indicator of what is taking place in our residential real estate market. That overall trend, you see, not only includes single family (detached) homes, but also includes townhomes and condos. At least some number of townhomes and condos are investment properties, and thus that segment of the market can look better or worse than the more traditional "I'm buying a house to live in it" segment of the residential market. For that reason, I believe that we will likely get a better sense of the health of the residential (I'm buying a house to live in it) market by examining only single family home sales. And with that preface aside, here's what we find..... ![]() As you can see, there were steady declines in the single family home market from 2005 through 2009 (-11%, -12%, -18%, -14%). That steady decline, however, slowed down significantly between 2009 and 2010 (-1%). That is a wonderful sign that the residential real estate market may truly be stabilizing. So, what are my predictions for 2011? I don't think we will see any more than a 2% decline in single family (detached) home sales --- as shown (approximately) with the red line. I also, however, don't think we will see any more than a 2% increase in single family (detached) home sales --- as shown (approximately) with the green line. After five years of a declining residential real estate market in Harrisonburg and Rockingham County, I think we might finally be poised to see an increase in sales activity. | |
![]() |
![]() |
Newer Posts | Older Posts |
Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
Licensed in the
Commonwealth of Virginia
Home Search
Housing Market Report
Harrisonburg Townhouses
Walk Through This Home
Investment Properties
Harrisonburg Foreclosures
Property Transfers
New Listings