WOW! is all I can say as the 2021 Real Estate Market kicks off. Beginning in Sept, inventory was eroding without new listings to replenish the inventory and buyer demand soaring to look at older listings. Demand is growing without a response from the sellers. Keep reading and check out the report.
The 2020 Real Estate Market closed with an End of Year Clearance Sale and the New Year starts Starved for Inventory! In the video I discuss:
- Eroding Inventory – New and Active Listings Down
- Scratch & Dents and older listings still are not enough to quench demand
- Weeks of Inventory, not Months
I’ve mentioned many times, DO NOT buy into the Hype Headlines. Closed sales for January are up 31% from Jan 2020, cleaning out the inventory. New Listings are the Fuel to this market. We have not seen Active Listings fall below New and Sold in >10 years. Demand is raging and supply is not keeping up.
2021 is going to bring many Hype Headlines when comparisons are made Year over Year (YoY) each month. Last year was a very different market and in September I started a YoY Year to Date comparison because we were not in the traditional Fall slow down and it was creating Hype Headlines.
Buyers continue to present a strong force, however, Sellers are slow to come to market. In the report I have a chart illustrating the double ending of the market with regards to interest rates. Just as there is a strong surge in mortgage originations, there is an equally strong surge in Refinancing and HELOC’s (Home Equity Lines of Credit). This indicates homeowners are investing in their homes and thus not selling! Many would like to say it’s because they are afraid of becoming a buyer, I say it is because they have invested in their home and made the choice to stay.
Here are a Few Standout Trends for the Region
- Home Equity is at an all-time high = low supply
- Home appreciation is running 10-15% for detached and townhomes across the region
- Refi’s make up 75% of the mortgage origination market = low supply
- Home owners are reducing monthly home expenses = low supply
- Well qualified buyers = high demand
- Largest consumer first time buyers = high demand
- Cash access = historically low interest rates fueling both the low supply & high demand
- NVA has valuable supply locked up – will home owners become sellers or continue holding?
- Locally, Condominiums are growing in inventory but not shifting to a balanced market – yet
- Regional valuation rates ended the year between 6 – 8%, higher than the normal 4%
- All 4 counties (Fairfax, Loudoun, Prince William and Fauquier) have sold more homes YTD than 2019 YTD and the region has exceeded 2019 sales
- Do not buy into the hype news, peel the layers of the onion
- Continuation of 2020 will continue into 2021
- Low supply – High demand – Low Interest Rates double ending the market
- Extremely Unique Sellers Market with all time high valuations
- Supply will not be impacted by foreclosures
- Values will continue to rise at a steady percentage until Inventory grows
- Days on Market remain <10 days with most offers written during Coming Soon Status
- Active Listings is the leading indicator – until months of inventory rises, valuations will continue to rise
The magazine is a very comprehensive and a unique Real Estate Trend magazine for this region covering the same 10 jurisdictions of the Northern Virginia Economic Development Alliance. It is always my goal to look backwards only to provide an opinion of the future and actionable advice. The following are the 10 jurisdictions covered and the links to individual videos and commentary:
- Summary of the region
- Cities of the Region
- Alexandria City
- Arlington City
- Fairfax City
- Falls Church City
- Manassas City
- Manassas Park City
- Counties of the Region
- Fairfax County
- Loudoun County
- Prince William County
- Fauquier County
The city and county sections have further details based upon the three structure types broken down by size along with city details within the counties:
- Detached Homes
I’m always open to feedback on the magazine to strengthen it for the community and applying the market information to your specific situation as a seller or buyer. As I tell my nephew all the time, You don’t know what you don’t know – Information is King – Just Ask!
I look forward to supporting you soon!