Let’s dive into the October 2023 Third Quarter Real Estate of NVA Market Analysis Report โ a story of starvation! Picture this: the market’s sizzling hot and hungry, but it’s got historically low inventory, creating a real estate dilemma!
The headline news, points fingers at high interest rates, claiming they’re playing spoilsport with sales. But the truth is, it’s not all about the interest rates, folks. There are simply 25% fewer homes on the market this year compared to the last, creating a real estate version of “Where’s Waldo.” Interest rates do have a say in the game, but with inventory doing its best disappearing act, competition’s dropped and property conditions are under the spotlight like never before.
Now, for all you market-watching ๐ wizards out there, trying to time the market and wait for those elusive lower interest rates might just result in some premium prices and epic bidding battles. And here’s the kicker โ there’s no magic wand that’s going to make inventory suddenly grow with lower interest rates.
Sure, interest rates can be a bit of a buzzkill, but here’s the silver lining: buying rather than renting can score you some sweet tax write-offs for the interest you pay. So, even with interest rates playing hard to get, you’ve got a tax superhero swooping in to save the day.
Let’s Jump into the Highlights:
๐ฒPRICES – STEADY RISE
๐ Falls Church City is cooling off slightly
๐ Moderate YoY YTD appreciation in the 1 – 4% range
๐ October closed with a ๐ฅsurge for two cities:ย Fredericksburg City (up 6.36% YoY YTD) and Manassas Park City (up 9.18% YoY YTD)
โ๏ธTIME ON MARKET – FLYING OFF THE MARKET
๐ย ~80% Under Contract in < 10 Days.
๐ ~90%+ Under Contract within 3 Weeks.
๐ข๐ SALES – DOWN DUE LESS INVENTORY
๐ย Down25%+ – not due to interest rates.
๐ย 25% Less inventory on the market than 2022 – New / Active / Sold inventory trend lines are on top of each other – What comes to market sells FAST!
๐ 1 month or less of inventory in any given city, at any given price point, on any given weekend. We work week to week, yes!
๐ธCONCESSIONS
๐ย 1 in 5 Sales has a concession of ~$8K.
๐ย Negotiability is slipping from 2022, however, not across the board.
๐ฏSALES TO ORIGINAL LIST PRICE
๐ Homes are well priced at listing with small premiums and extreme competition for the “Pottery Barn”,ย cream puff homes.
๐ Just because inventory is historically low does not equal anything will sell at any price. Know your target buyer!
๐ฐYoY YTD
๐ Moderate appreciation, 1% – 4%,
๐ We are starting to see 6%+, even into double digits with the dropping interest rates indicating a competitive market in some regions by structure type.
๐ In desirable locations, Condominiums and Townhomes are experiencing a surge in premiums as a tradeoff of affordability over location.
OPINION:
The big story that is brewing are the declining interest rates and competition is firing on all cylinders:ย Minimal Concessions, Market Speed, Premiums on Pricing and Throttled Inventory choking the market of hungry buyers. The buyers are figuring out this market and adjusting their requirements and either downsizing for affordability (Condominiums and Townhomes) in order to maintain desirable locations.
As I was reviewing highlights for each City / County, I found myself repeatedly noticing higher levels of appreciation for Townhomes and thus since I’m a visual person, I put together a new chart to easily see how each structure type is stacking up City by City and County by County.
The chart below highlights 6%+ and into double digit appreciation for Condominiums and Townhomes and we are seeing the sprawl push out to Prince William and Stafford Counties, again for affordability. It’s all about trade-offs to achieve home ownership!
MAIN EVENT – REAL ESTATE OF NVA MARKET ANALYSIS
This report spans across the THIRTEEN jurisdictions 10 of the Northern Virginia Economic Development Alliance and I’ve added Fredericksburg City, Spotsylvania and Stafford Counties โ a testament to its comprehensive embrace of the region’s heartbeat. Engage with us, with a quarterly rendezvous of videos and insights that illuminate the path forward.ย ๐๐๏ธ๐ข
Enjoy!
BOTTOM LINE
No one can predict with accuracy what will happen in the Real Estate Market, but one thing is for sure, rent is throw away and always rises!ย
We look forward to speaking with you as you stride towards your real estate aspirations in the place we call home, the realm we cherish โ Northern Virginia.
As always . . .
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