• City of Harrisonburg = 17.41 square miles (around 13K properties)
   
  
• Rockingham County = 853 square miles (around 86K properties)
  

• There always seem to be more home sales in the County than in the City, at least when looking at the past five years.  Last year, 67% of buyers bought in the County, and 33% bought in the City.
   
• Sales are growing faster in the County than in the City, as over the past five years, sales have increased 23% in the County, while only increasing 9% in the City. That said, over the past year, sales in the County and the City both declined.
   
• Properties sell much more frequently in the City of Harrisonburg, as last year, approximately 3% of City properties changed ownership, while only approximately 1% of County properties changed ownership.

There are any number of factors that affect whether buyers end up buying in the City or County, including what type of property they are seeking, how much land they desires, school systems, employer locations, and much more.

• Buyer A paid $250K for a 3 BR, 2 BA, 1800 SF, circa 2000 home
• Buyer B paid $255K for a 3 BR, 2 BA, 1850 SF, circa 2001 home
• Buyer C paid $245K for a 3 BR, 2 BA, 1750 SF, circa 1998 home

When you then are considering a new listing of a 3 BR, 2 BA, 1800 SF, circa 2000 home -- it would seem reasonable to think that you'd likely pay between $245K and $255K.

Of course, there are a variety of other extenuating factors that can affect this pricing:

• Garage vs. no garage
• Basement vs. no basement
• Updates vs. no updates
• All SF above grade vs. some SF in the basement
• Level lot with large yard vs. steep lot with small yard

So -- how does one best research what homes are selling, and at what prices?

I'll remind you of -- HarrisonburgNeighborhoods.com.

1. Boomers won't move
    
   
2. Landlords won't sell
    
   
3. Owners are hooked on low mortgage rates
    
   
4. Builders ignore entry-level buyers
    
   
5. Regulations add costs
    
   
6. Owners want to restrict supply

And, the author's ideas for how buyers can respond to the situation:

• Be realistic about how long it will take to find and buy a home. Real-estate agents can provide an estimate, based on market conditions.
   
  
• Save plenty of money for a down payment and reserves.
   
  
• Improve your credit score to get a good mortgage deal.
   
  
• Be ready to make a competitive offer when a suitable home comes on the market.
  

It's a great article -- read it all here -- and I think much or most of what they are talking about from a national perspective applies very directly to the Harrisonburg and Rockingham County housing market.

1. Home sales declined during November 2016 to 94 sales --  a 17% decline from last November.
    
2. Home sales are down 6% thus far in 2017 as compared to the past 11 months of last year.
    
3. The median sales price has risen 3% over the past year, when comparing January through November of this year to last year.
    
4. Homes are selling a good bit faster this year than last -- with a 35% decline in median sales price, down to 33 days.

Last year certainly was interesting!?!  Or odd!?! 

Last August, September and November were OFF THE CHARTS as far as a record number of home sales for those months -- which then makes this year's sales trajectory seem as slow as mud in August, September and November.  This November's sales were a good bit higher than in 2014 and 2015 -- but were solidly below November 2016.

So -- despite the fact that 2017 is hiding in the shadows of a towering year of sales in 2016 -- it is interesting to note that the 11 months of home sales thus far in 2017 (all 1,149 of them) has already surpassed the full 12 months of sales seen in 2013 (1067 sales), 2014 (1085 sales) and 2015 (1125 sales).  As such -- while total home sales will likely be 5% to 6% lower this year than last -- that will still mark a solid improvement as compared to any other recent year.

After quite a few years of steady increases in buyer activity -- we are starting to see a decline.  Over the past six months we have seen buyer activity taper off and start to decline.  I believe this is a direct result of the drastic reductions in the availability of homes for those buyers to buy.  As the number of sellers in the market at any given time has declined, eventually that also resulted in a reduction in the pace of buying activity.

Yeah, so, about those inventory levels.  They are low and getting lower!?!  And, realistically, when and how do we think that would or could change?  In theory, inventory levels will rise this coming Spring -- except they didn't during 2017.  Looking back, the end of last November was the highest inventory level we saw for the following 12 months!?!  So -- hmmm -- absent any outside factors (new home construction, anyone?) it is possible that the current inventory level (322 homes for sale) could be the highest inventory level we will see for the next 12 months!?!  Stop and think about that for a moment....

Somewhat interestingly, as shown above, there has been a larger (proportional) decline in inventory levels for attached properties (townhouses, duplexes, condos) than for single family detached properties.  There are now only 56 townhouse/duplex/condo properties available for sale in all of Harrisonburg and Rockingham County!

And finally -- one last look at some interesting trends....

As shown above, nearly half (46%) of homes that are selling (not of all that are listed) are selling (going under contract) within 30 days of hitting the market.  So -- yes -- the market is moving pretty quickly in many locations and price ranges!

OK -- I'll stop there for now.  There is plenty more in my full market report, so feel free to download it as a PDF, read the entire report online, or watch/listen to a video overview of this month's report.

And, my reminders for buyers and sellers last month still apply....

SELLERS -- even though it is a seller's market in many price ranges right now, you must still focus on price, condition and marketing.

For further reading on buying or selling in this area, check out....

• BuyingAHomeInHarrisonburg.com


• SellingAHomeInHarrisonburg.com

Purchasing a home can be fun, exciting, thrilling, and fulfilling....but that very same process can also have its moments of being hard, frustrating, disappointing and overwhelming. In my role as a Buyer's Agent, I will be working with you through the entire home buying process to make it as educational and stress-free as possible.

The very first step in this process is for us to discuss your needs, goals, dreams and desires. This may involve specifics such as the number of bedrooms and bathrooms, or may focus more on the layout of homes, the feel of a neighborhood, and the long term plans for your growing family. I will be focusing on listening well, and hearing what it is you are working to achieve with your home purchase – and then helping to identify the best housing options for accomplishing those goals.

An important, parallel, part of starting the home buying process is to identify a target price range. This can best be determined through consultation with a reputable, local mortgage lender (just ask... I know who they are) but will involve more than just determining the highest priced home that they would allow you to purchase. It will be important to consider both your purchasing power, and your goals for how your housing costs will fit into your overall budget. You will also talk with your mortgage lender about how different loan programs might work better (or worse) for your situation.

Once we have a shared understanding of what you are hoping to purchase, and we know what the price tag can and should look like, we can start to evaluate homes that are currently on the market. This will usually start online, perhaps through an exchange of emails, and saving some searches in your account on my web site. Then, you might choose to drive by some of the prospects before determining a list of homes to go view – or you may be ready to start seeing all of the homes on the list right away. As we view this first set of homes, we will learn a lot – about the opportunities in the market, and about your preferences.

If we don't identify a home after looking at all of the homes on the market that seem to offer what you are looking for in a new home, we will either re-evaluate our criteria to expand our search, or we will wait to view new listings that come on the market. This extended home search process might take us weeks, or months, depending on the type of property you are hoping to purchase, and how often such a property becomes available. All along the way, I'll be following up on previous homes we have viewed to let you know if their prices have dropped, and will be letting you know of new opportunities as soon as those houses hit the market.

Once we have identified the home you are hoping to purchase, we will prepare to make an offer. This will include researching similar home sales to guide our discussions of price, creating a negotiation strategy, and preparing and reviewing the pertinent contract documents. There is quite a bit of paperwork involved in making an offer on a home, and I want to make sure that you understand these contract documents and make sure that we have drafted them in a way to protect your best interests.

Negotiating the final deal on the property you purchase may take a few hours, or a few days. We may go back and forth with the seller on price alone, or on many terms of the contract such as timing, contingencies, and more. Once we have a final agreement, all parties will sign and initial the final documents, and we will have a full ratified contract.

Immediately following the ratification of the contract, we will need to schedule and perform a home inspection and radon inspection (assuming you are conducting both) to learn more about the property you are purchasing. If these inspections reveal new (detrimental) information about the property, we will have the opportunity to request that the seller make repairs to the property, which may result in a renegotiation on price. Typically, we are able to work through this second round of negotiations relatively quickly, so long as the seller is being realistic and rational given the new information about their property.

Simultaneously with conducting these inspections, you will need to be starting the financing process to work towards obtaining full loan approval. This will start with signing your loan application and paying any applicable loan application or appraisal fees. Your lender will then be diligently working to further qualify you as a purchaser as well as the property via an appraisal. You will be providing many documents to your lender during this process as they work towards securing a loan for you to purchase the property.

Within the first few weeks after your contract is in place, we will need to select service providers to coordinate the additional aspects of your home purchase. This will include a settlement agent or attorney who will conduct a title search of the property and prepare all documents for your settlement. You will also need to set up a new homeowners insurance policy on your new property, as well as schedule utility service to start in your name as of the settlement date.

We'll now be just a few weeks before closing, and the final pre-settlement details will include reviewing the settlement statement (which shows all of the funds coming into and going out of the closing), conducting a final walk though of the property (to confirm the condition is as we expect it to be), and obtaining a cashier's check to bring the necessary funds to settlement. All of the details should be falling in place now, and if all goes well, we will be set for an on-time settlement.

In nearly all real estate transactions (in this area) you will sign all of the loan and settlement documents at your real estate closing as well as receive the keys to your new property. The house will be your new home, and you can take possession and start moving in immediately after settlement. Later that day, the settlement agent will record the deed at the courthouse that officially transfers ownership of the property into your name.

You are bound to have questions about the home buying process – before you begin, as we go, and even after settlement. I am here to answer all of those questions, or to guide you to the professional who can. There is plenty to learn about the home buying process, and I am here to help guide you through it and to help you make excellent decisions about your purchase of a home.

Learn more about the home buying process at BuyingAHomeInHarrisonburg.com.

• Four Full Bathrooms
• Three Full Bathrooms, One Half Bathroom
• Two Full Bathrooms, Two Half Bathrooms
• One Full Bathroom, Three Half Bathrooms

Right -- so -- when checking out homes on Zillow....

1. Scroll down until you find the actual bathroom count.
    
2. Feel free to double check with me (or visit scottprogers.com) to double check any other potential listing accuracy issues.
   

Read more about our overall housing market in my most recent monthly market report....

• A decline in buyer interest / activity -- which only seems to be happening (slightly) because of lower inventory levels. 
   
• A decrease in the rate of people moving to this area.  Seems unlikely -- we're one of the fastest growing areas in Virginia.
   
• An increase in the rate of people moving out of this area.  Seems unlikely -- it's pretty nice here, unemployment is low, quality of life is high, etc.
   
• More new homes being built.  This is not currently happening at a very rapid pace in and around Harrisonburg.
   
• Sellers selling who don't have to buy.  This could be older homeowners who are moving into a retirement community, or people selling to then build themselves a home on their own land, etc.

Again -- none of the changes above seem likely to happen at a scale that would allow inventory levels to see much, if any, of an increase next year.  As such, I am expecting we'll see relatively similar inventory levels next Spring and Summer. 

Sorry to be the bearer of bad news -- as always, just trying to give folks realistic expectations for the future.

• We have a strong and growing economy with low unemployment, so prospective tenants are likely to be able to keep jobs and keep paying the rent.
   
  
• Well maintained rental properties seem to be in short supply and are renting quickly.
   
  
• We are seeing slow and steady growth in home values which doesn't shown signs of stopping -- meaning your rental property is likely to continue to increase in value.
   
• If property values keep increasing over the next few years, as most expect that they will, there is not some "better time" than now that will be coming up in the near future.
  

• Inventory levels are low, resulting in a seller's market -- meaning you won't be buying a rental property at a discount -- and you may be competing with quite a few intended owner occupants when you are making an offer.
   
• Home values are not currently depressed with a likely quick increase in those values in the next few years.  Thus, it is very difficult to buy "below market" and have any "instant equity" in the immediate or near-term future.

There are a variety of other factors that could be put on one of the lists above -- but at the end of the day, it is not a clear or obvious decision to buy or not to buy.  Some of the factors that should likely weigh in as you think about this decision are:

• How long do you plan to own the rental property?
   
• What are your investment goals?  (cash flow now vs. value later for example)
   
• Are you willing to invest in another market if you could find one where the opportunities seemed to be better than in Harrisonburg?

Below, then, also are a variety of resources that might be helpful to you as you think about this decision and as you consider specific rental properties....

• HarrisonburgForeclosures.com (upcoming foreclosure sales)
   
  
• HarrisonburgInvestmentProperties.com (overview of categories of investment properties)
   
  
• HarrisonburgInvestmentProperties.com/tools/ (Excel files of analysis tools)
   
• HarrisonburgTownhouses.com (overview of townhouse communities)
   
• NewListingsInHarrisonburg.com (review or sign up for email alerts for new listings)
   
• JustSoldInHarrisonburg.com (review, search or sign up for email alerts for recent sales)
   
  
• HarrisonburgAssessments.com (find City/County assessment and tax record data)

1. Consider asking for a credit in lieu of repairs so that you can be in charge of how the repairs are made.
    
2. If you are asking for repairs to be completed by the seller, be very specific about how you want them to be completed.
    
3. Understand that it is not always reasonable to ask a seller to make a repair with a 10 year future in mind. 
    
4. Be willing to compromise with the seller to find a way to move forward on the home that you are, presumably, still excited to buy!

• Fewer buyers wanting to buy -- which does not seem likely now or in the near future.
   
• Construction of new homes.  There are some being built -- but not many.  Most new construction in the City is student housing.
   
• Homeowners selling in the City, and buying in the County.  This is a net increase of one additional home that can be sold/purchased in the City.
   
• Homeowners selling in the City and leaving the area.  I suppose this happens from time to time, but not frequently.
   
• Homeowners selling in the City and not buying a new home. 
  

There is no easy way to turn this trend around -- and to have more options for City home buyers -- and until this does change, it can be quite challenging for buyers to find a home they want to purchase in the City.

1. A desire for more living space tops the list, and is understandable -- as many millennials may be moving out of apartments or other smaller living spaces -- or may be sharing a home with a roommate, etc.
    
2. It is good to see that millennials are interested in building equity in a home that they purchase.  Buying a home, and thus having your monthly housing costs paying down the principal balance of your mortgage, is a much better feeling than paying those monthly housing costs each month to pay down your landlord's mortgage. 
    
3. A desire for more space or a yard for a dog is surprising, at first, but given the age of millennials, maybe there are more such buyers still in the pre-marriage, pre-kid stage of life?

Knowing why you are buying a home, and how long you think you will be in that home, are important things to be thinking about as you are preparing to embark upon the home buying process.

Thanks to JoDee Lambert at SunTrust Mortgage for this fun infographic.