NOVEMBER 2018 – Real Estate Market Recap: Augusta County, Staunton & Waynesboro

 

11.2018_SNAPSHOT

RESIDENTIAL SALES: MONTH -TO- MONTH

11.2018_SALES

The number of sales hit an all-time high in 2005, with a total of 1598 closed transactions and a low in 2010, with 935. The market has gradually improved since then…

  • 2013 = 1220 sales
  • 2014 = 1383 sales
  • 2015 = 1489 sales
  • 2016 = 1511 sales
  • 2017 = 1581 sales

November 2018 monthly sales (118) was an expected 11% DECREASE when compared to last month, October (133). (2017 had a similar 10% decrease from Oct-Nov.); Nov 2018 sales (118) was a 5% DECREASE from last year’s November sales (124).

November’s 2018 Year-to-Date sales, (1465)  displays a negligible 1% DECREASE under November 2017 YTD sales, (1487).

November’s 12 Month Running Total (1611) mimics the YTD, with less than 1% Decrease under Nov 2017’s 12 Mo. Running Total, (1620). (This is a better predictor of our current market.)

RESIDENTIAL INVENTORY: MONTH -TO- MONTH…and the lack of inventory saga continues.

The number of active listings in Jan 2009 was 498, increased to a high of 1509 in Aug 2010. We started 2018 with 450 active listings, which was 20% LESS than Jan 2017. Historical lows in inventory began back in 2016, homebuyers and agents really started to feel its impact during the 3Q buying season. The end of 2016 deemd itself a “price-adjusting” year, cleaning out stale properties. 2017 followed a similar pattern with low inventory and price-adjusting. 2018’s inventory continues to be squeezed: Inventory opened up a tinie-tiny amount in May…but decreased again in June and was further depleted this Fall.

  • November 2018’s inventory is 18% LESS than Nov 2017; 36% LESS than Nov 2016; 50% LESS than Nov 2015.11.2018_INVENTORY

 

11.2018_ABSORPTION

11.2018_AVERAGE_SALES_PRICE

AVERAGE SALES PRICE: MONTH -TO- MONTH…

With low supply, comes high demand…reflected in the increasing Average Sales Prices. We noticed a solid 6% INCREASE over the course of 2017, most dramatic in properties within the $250k and under price segment. November 2018 Average Sales Price ($231,966) is a whopping 31% INCREASE over Nov 2017 ($176,868, the lowest of the year). Nov 2018 ASP is a 12% INCREASE from last month, Oct 2018 ($204,382). Each month in 2018 has experienced its highest ASP, year-over-year, for the last five years.

*[November did have one unusual over $1M sale, which obviously contributed, but even with that transaction taken out of the calculated average, the month still experienced a five year high of $221,982].

[Unfortunately, what is NOT factored into the average sales price, is the average amount of seller paid concessions. In November 2018, 56% of sales transactions included seller paid closing costs. Of those transactions with seller paid concession, average paid was $5158 at settlement.] 28% of the Buyer’s from August’s transactions financed with gov’t backed loans, (i.e. FHA, VA, VHDA, and USDA). These loans offer no-to-low down payment features; 46% obtained conventional financing’ 15% were all-cash transactions.

  • Average Days on Market (DOM) for 2005 was 101 Days, and steadily increased to an all-time high of 177 days in April 2013.
  • 2017’s DOM bumped around, but averaged out to an annual ave11.2018_DOMrage of 77 Days.
  • Nov 2018 Stats: Average: 58 DOM / Median 33 DOM
  • % of November Sales Under Contract within…
    • 36 % of monthly sales were pending within 15 Days
    • 47 % of monthly sales were pending within 30 Days
    • 71 % of monthly sales were pending within 60 Days

* FINAL THOUGHTS *

We are officially in the organic seasonal downshift of buying and selling real estate. With that said, this area is still experiencing much of a “seller’s market” supported by historically low inventory and equally historically high Average Sales Prices. Days on Market have continued to stay low, especially for those properties in the $250k and under price range.

Interest rates have been creeping higher, and predicted to continue through-out the year. This will propose yet another hurdle for potential buyers. Higher interest rates could also affect homeowners thinking about selling their property. Many could decide to stay put, not willing to buy their next homesweethome at the cost of a higher rate…continuing this low supply saga.

  • FOR SELLERS: Proper pricing & staging is key for a quick and smooth transaction. (Properties that are over-priced are idling on the MLS, while properly priced homes are continuing to move quickly. Revisit Days on Market Stats above.)
  • FOR BUYERS: Interest rates have been creeping upwards, and predicted to increase through-out the year. Remain in contact with your chosen lender to stay current with affordability, and request a Pre-Approval Letter to submit with any offer to display financial stability and strength. Don’t be surprised if you find yourself in a multiple-offer situation, competing for your dream home. Its essential for buyers to discuss with their real estate agent competitive offer strategy. Contract contingencies that were the norm just a few years ago, may not fly in this “multi-offer” market. When offering over list price, appraisal contingencies are a must, as appraisers catch up with 2018’s upward movement.

 

Happy Holidays!

Katherine

 

* This report was prepared by and for the use of Katherine McNicholas, Westhills Ltd. REALTORS. It is not to be copied in whole or in part without explicit permission of author.*

* All data based on information from the Greater Augusta Association of REALTORS®, Inc. or Multiple Listing Service. All information is believed to be accurate, but cannot be guaranteed.

AUGUST 2018 – Real Estate Market Recap: Augusta County, Staunton & Waynesboro

08.2018_SNAPSHOT

RESIDENTIAL SALES: MONTH -TO- MONTH

08.2018_SALES

The number of sales hit an all-time high in 2005, with a total of 1598 closed transactions and a low in 2010, with 935. The market has gradually improved since then…

  • 2013 = 1220 sales
  • 2014 = 1383 sales
  • 2015 = 1489 sales
  • 2016 = 1511 sales
  • 2017 = 1581 sales

August 2018 monthly sales (146) displayed a slight 4.5% DECREASE when compared to last month, July (153); and a noted DECREASE from August 2017’s number of sales (167).

August’s 2018 Year-to-Date sales, (1066)  shows a marginal 2.4% DECREASE under August 2017 YTD sales, (1092).

August 12 Month Running Total (1754) displays a negligible 0.5 Decrease under August 2017’s 12 Mo. Running Total, (1732). (This is a better predictor of our current market.)

RESIDENTIAL INVENTORY: MONTH -TO- MONTH…that red line CONTINUES to look so lonely.

The number of active listings in Jan 2009 was 498, increased to a high of 1509 in Aug 2010. We started 2018 with 450 active listings, which was 20% LESS than Jan 2017. Historical lows in inventory began back in 2016, homebuyers and agents really started to feel its impact during the 3Q buying season. The end of 2016 deemd itself a “price-adjusting” year, cleaning out stale properties. 2017 followed a similar pattern with low inventory and price-adjusting. 2018’s inventory continues to be squeezed: Inventory opened up a tinie-tiny amount in May…but slightly decreased again in June and remained in the mid-400’s in August.

  • August 2018’s inventory is 23% LESS than Aug 2017; 41% LESS than Aug 2016; 52% LESS than Aug 2015.

08.2018_INVENTORY

08.2018_ABSORPTION

08.2018_AVERAGE_SALES_PRICE

AVERAGE SALES PRICE: MONTH -TO- MONTH…

With low supply, comes high demand…reflected in the increasing Average Sales Prices. We noticed a solid 6% INCREASE over the course of 2017, most dramatic in properties within the $250k and under price segment. August 2018 Average Sales Price ($216,911) is 0.5% DECREASE than August 2017 ($218,137, which happened to be the highest monthly ASP of last year). Up until last month, every month has experienced its highest ASP year-over-year for the last 5 years.

[Unfortunately, what is NOT factored into the average sales price, is the average amount of seller paid concessions. In August 2018, 55% of sales transactions included seller paid closing costs. Of those transactions with seller paid concession, average paid was ~$5039 at settlement.] 31% of the Buyer’s from August’s transactions financed with gov’t backed loans, (i.e. FHA, VA, VHDA, and USDA). These loans offer no-to-low down payment features, further supporting the trend of many buyers not having liquid funds when purchasing.

  • 08.2018_DOMAverage Days on Market (DOM) for 2005 was 101 Days, and steadily increased to an all-time high of 177 days in April 2013.
  • 2017’s DOM bumped around, but averaged out to an annual average of 77 Days.
  • Aug 2018 Stats: Average: 47 DOM / Median 26 DOM
  • % of August Sales Under Contract within…
    • 43 % of monthly sales were pending within 15 Days
    • 55% of monthly sales were pending within 30 Days
    • 68 % of monthly sales were pending within 45 Days

* FINAL THOUGHTS *

We are currently sliding into the organic seasonal downshift in buying activity. With that said, historically low inventory is keeping Average Sales Prices up and Days on Market down for now. Its a somewhat challenging market for homebuyers out there, especially those seeking in the under $250k range. Its essential for buyers to discuss with their real estate agent competitive offer strategy. Contract contingencies that were the norm just a few years ago, may not fly in this “multi-offer” market. When offering over list price, appraisal contingencies are a must, as appraisers catch up with 2018’s upward movement.

Proper property pricing from the seller’s side is key for a quick and smooth transaction. (Properties that are over-priced are idling on the MLS, while properly priced homes are continuing to fly off of the shelves. Revisit Days on Market Stats above.)

Interest rates have been creeping higher, and predicted to continue through-out the year. This will propose yet another hurdle for potential buyers. Higher interest rates could also affect homeowners thinking about selling their property. Many could decide to stay put, not willing to buy their next homesweethome with the cost of higher rates…continuing this low supply saga.

Excited to see what Fall 2018 will bring! – Katherine

 

 

* This report was prepared by and for the use of Katherine McNicholas, Westhills Ltd. REALTORS. It is not to be copied in whole or in part without explicit permission of author.*

* All data based on information from the Greater Augusta Association of REALTORS®, Inc. or Multiple Listing Service. All information is believed to be accurate, but cannot be guaranteed.*

MARCH and First Quarter 2018 – Real Estate Market Recap: Augusta County, Staunton & Waynesboro

03.2018_SNAPSHOT

RESIDENTIAL SALES: MONTH -TO- MONTH

03.2018_SALES

The number of sales hit an all-time high in 2005, with a total of 1598 closed transactions and a low in 2010, with 935. The market has gradually improved since then…

  • 2013 = 1220 sales
  • 2014 = 1383 sales
  • 2015 = 1489 sales
  • 2016 = 1511 sales
  • 2017 = 1581 sales

March 2018 monthly sales (106) displayed a 13% DECREASE when compared to March 2017, (122). The lack of inventory is keeping sales at bay.

March 2018 Year-to-Date sales, (287) shows a marginal 2% DECREASE over May 2017 YTD sales, (292).

RESIDENTIAL INVENTORY: MONTH -TO- MONTH…that red line looks so lonely.

The number of active listings in Jan 2009 was 498, increased to a high of 1509 in Aug 2010. We started 2018 with 450 active listings, which was 20% LESS than Jan 2017. Historical lows in inventory began back in 2016, we started feeling the crunch during the 3Q buying season. The end of 2016 deemd itself a “price-adjusting” year, cleaning out stale properties. 2017 followed a similar pattern with low inventory and price-adjusting. 2018’s inventory continues to drop, and squeeze the market.

  • March 2018’s inventory is 24.5% LESS than March 2017, and 43% LESS than March 2016.

03.2018_INVENTORY

03.2018_ABSORPTION

AVERAGE SALES PRICE: MONTH -TO- MONTH…

With low supply, comes high demand…reflected in the increasing Sales Prices. We noticed a solid 6% INCREASE over the course of 2017, most dramatic in properties within the $300k and under range. March 2018 Average Sales Price ($213,009) is 7.7% HIGHER than March 2017…the highest March ASP we have experienced in the last five years.

[Unfortunately, what is NOT factored into the average sales price, is the average amount of seller paid concessions. In March 2018, 53% of sales transactions included seller paid closing costs. On average, the seller paid ~$5000 at settlement.]

* FINAL THOUGHTS *

The present-day market is an extremely opportune & advantageous time to sell property. (If owner-occupied, make sure you know where you are going! With the tight inventory, you may have a hard time finding a suitable next home!)

Proper property pricing is essential in selling your home. With an Average Days on Market at 68 days, and median at 47 days, (normal market is considered 90) Homes that are still available after those noted marks, have “over shot the mark” and their market value. Below are some factoids for properties sold in 2018 thus far…

  • 31.5% properties sold in 15 Days OR LESS
  • 54.5% properties sold in 60 Days OR LESS

Interest rates have risen in the last 12 months, and are forecasted to slowly rise over 2018…this will affect purchaser borrowing power, which could stall/dampen any dramatic market increases.

* QUICK FIRST QUARTER SNAPSHOT *

1Q2018_SNAPSHOT

 

* This report was prepared by and for the use of Katherine McNicholas, Westhills Ltd. REALTORS. It is not to be copied in whole or in part without explicit permission of author.*

* All data based on information from the Greater Augusta Association of REALTORS®, Inc. or Multiple Listing Service. All information is believed to be accurate, but cannot be guaranteed.*

2017 Residential Sales Recap: Greater Augusta County Area

LOW SUPPLY -and- HIGH DEMAND: Residential Real Estate 2017 Review

Similar to 2016, 2017 was very much a “price adjusting” year.  The Valley experienced residential market sales growth, despite restricted & historically low housing inventory. High buyer confidence & demand elevated sales prices, and dramatically decreased days on market. It was a great year to be a seller, and a struggle to be a buyer.  A more detailed, localized look below…

2017_SNAPSHOT

INCREASE IN SALES TRANSACTIONS & VOLUME

The Greater Augusta Area experienced yet another increase in year-over-year sales when compared to last year.  2017 closed 1613 transactions; a 6.8% increase from 2016’s number, (1511 sales). This is the second consecutive year of sales growth. (2016 experienced a similar increase of 6% when compared to 2015.)  2017’s Total Market Volume displays this growth in sales and increase in Sales Price; reflecting a 13% increase from last year.

2017_QUARTERLY_COMPARISON_SALES

2017_MONTHY_SALES

The highest number of sales occurred during 2Q, (475 total transactions.); May was the highest selling month with 184 sales; and as expected, January & February tied for the slowest, with 85 sales each. (Yet 1Q 2017 still noted a solid 9% increase over 1Q 2016). Aside from the natural recycling of households upsizing & downsizing in the market, we have noticed a large segment of buying clientele from our neighboring larger, faster growing cities. They are starting to discover the easy commute, slower-paced lifestyle, and more affordable real estate this area has to offer. In all areas, its been a challenge being a buyer looking for a home in the $200,000 and under price range. (More on the that topic below…)

LOW INVENTORY

So, the big story of low housing inventory continued in 2017. The decrease in supply began in the Fall of 2015, became historic in February 2016 and continued to drop…

2017_MONTHY_INVENTORY

Low inventory means not-a-thang if you don’t have home buyers…Fortunately, we DO have buyers, as seen in the past two years of sales growth…(I mean, who wouldn’t want to live here!?) Locally, we started to feel the crunch in August 2016,  when our absorption rate* dropped into a “seller’s market”, which continued for the entirety of 2017.

2017_ABSORPTION_CHART

[*Absorption Rate = the rate at which available homes are sold in a specific real estate market during a given time period. It is calculated by dividing the average number of sales per month by the total number of available homes.]

The absorption rate can very useful when calculating more specific perimeters. 2017’s Price by the Slice displays the majority of homes sold were within the $100,000 – $250,000 price range, (representing 65% of the market.) The year ended with this price point having an absorption rate of 3.4 months; basically, there are more buyers than available homes for purchase. (Versus the higher price slice of $350,000 – $400,000, which had an absorption of 8.5 months.)

INCREASE IN MEDIAN & AVERAGE SALES PRICE

The chart below illustrates 2017’s monthly average sales prices compared to previous years.  We ended 2016 on a strong note, and 2017 continued the pattern into summer, with a slight dip in 4Q. Even with the 4Q average price decrease, this year we experienced an overall 6% increase in Average Sales Price, and a 3% increase in Median Sales Price.

2017_MONTHLY_AVE_SALES_PRICE

2017_QUARTERLY_COMPARISON_PRICE

DAYS ON MARKET

Days on Market for properties dropped significantly over the course of the year; Average DOM dropped from 99 Days in 2016 to 77 Days in 2017; Median days on market decreased to 36 days! (A normal market is considered to be around 90 DOM).

Much of the stale inventory, with their higher Days on Market from last year, were flushed, and replaced with aggressively priced properties. Property sellers & listing agents alike have been testing  buyers and their pain threshold when it comes to pricing. No one wants to leave money on the table…appropriate pricing and quick adjustments to the current market have been key in keeping DOM down. With that said, Homebuyers, (AND their agents), were, (still are), scrambling to get into desirable available inventory as soon as possible, making competitive offers in “highest & best” scenarios.

(The struggle is REAL ya’ll…I have actually left my house in such a rush, accidentally still wearing my slippers, in the middle of boiling water for dinner, to meet clients at a newly listed house this past year. Truth.)

Here’s another way of looking at Days on Market, and how it compares to most recent years…

2017_DOM

 

INCREASE IN LAND SALES

So, how are buyers reacting to lack of existing housing?…They decided to BUILD. Check out the chart below, s’il vous plais…

2017_LAND_SALES

Even with the continued rise of lumber & building supply pricing, the National Association of Home Builders reported that 46 states experienced a growth in single-family permits. [The National Association of Home Builders  is a great resource for more information. Here is a link to their informative blog, NAHB Eye on Housing.]

INTEREST RATES…What happened and what’s in the future?

The first 10 months of 2017, mortgage rates remained low by historical standards (Exhibit 7).  Can you imagine paying 18%!!!! I have no clue how my parents did it. Anyhoo…Mortgage rates increased over 0.5 percentage points for the 30-year fixed mortgage, right after the  U.S. general election in November of 2016. They remained above four percent through the first quarter of 2017. Then drifted down in March, the 30-year fixed mortgage has remained under four percent since July (Exhibit 8). Low mortgage rates are the one factor helping to support homebuyer affordability.

 

FREDDIEMAC_RATE_chart2

Interest Rate Charts courtesy of Freddie Mac.

What’s in the future? Most likely the rates will increase over the next 2 years, but at a much more modest speed than in the past, remaining “borrower-friendly” low. I’ll leave it to the experts, the Freddie Mac ECONOMIC & HOUSING RESEARCH GROUP to provide a more thorough and entertaining explanation…

We’re in an era of historically low mortgage interest rates and the expectation is that interest rates have nowhere to go but up. But how quickly will rates increase and how high will they go? If they do rise, what will be the effects on home buyers, homeowners wishing to refinance, mortgage lenders, home builders, and real estate agents? To answer these questions, it’s helpful to review periods when interest rates spiked and analyze the effects, with the hopes of understanding what might happen in the coming years. It’s the next best thing to a crystal ball. CLICK HERE to read Freddie Mac’s INSIGHT article: Nowhere to go but up? How increasing mortgage rates could affect housing.

**Looking for a broader point-of-view? I got ya covered. Here’s a link to VIRGINIA HOME SALES REPORT – 4Q & 2017 Year End Report.

 

Happy House Hunting – Katherine

 

* This report was prepared by and for the use of Katherine McNicholas, Westhills Ltd. REALTORS. It is not to be copied in whole or in part without explicit permission of author.*

* All data based on information from the Greater Augusta Association of REALTORS®, Inc. or Multiple Listing Service for the period 01.1.17 through 12.31.17. All information is believed to be accurate, but cannot be guaranteed.*

2Q 2017 Real Estate Market Recap: Augusta County, Staunton, & Waynesboro

Second Quarter 2017 in the greater Augusta County area displayed promising activity across the board. The continued available housing inventory crunch has many buyers and their agents in a tailspin, with sellers reaping the rewards. Our sweet slice of Virginia’s residential activity noted an increase in Average Sales Prices and Market Volume, as well as a decrease in how long properties are available to purchase, (Days on Market).

2Q_SNAPSHOT

Average Sales Prices have increased ~7% from 2Q 2016. As previously mentioned, low supply has been a major contributor. Low mortgage interest rates, (with the impending increases in the near future), and the availability of attractive low down payment & “no money” down loan products have also helped fuel 2017’s Spring market activity.  With that said, we continue to see buyers needing cash at closing, and negotiating a portion of their closing costs into the sales contract. (51% of buyers last quarter received, on average, $4900 from seller proceeds, attributed to their financial responsibilities at settlement.)

06.17_Ave_Sales_Price

06.17_RESI_Inventory

In the chart below, you will see the affect of low supply measured in what is called an “absorption chart”. The “absorption rate” calculates the amount of existing & available inventory with the rate of sales. The absorption rate displays how long it would take to sell the currently active inventory, if no other “for sale” properties were added. This provides us with an overall reflection of our broader area market conditions. The chart below displays that we have been in a normal market since August of 2016…

06.17_AbsorptionRate

Absorption rates can differ dramatically depending on the location, condition, price range, etc. In 2Q, the majority of our market area sales, 64%, were within the $100,000 – $250,000 price range. This price range had an absorption rate of 5.5 months, (hovering in a “seller’s market”). Here is the price bracket/absorption breakdown for the month of June…

June_Absorption Rates

WHAT’S HOT?

  • New listings in the $100k – $199,999 range.
  • Properly priced homes in all price ranges.
  • Low interest rates and low-to-no down payment mortgage financing options.
  • Foreclosures represented only 7% of 2Q residential sales. (Down 1% from 2Q 2016.)
  • 2 – 5 acre Augusta County land sales
  • Taylor Swift’s new video…(ummm, personally, I haven’t seen it yet, but my 8 year old child says it is a-w-e-s-o-m-e.)

WHAT’S NOT?

  • Over-Priced Properties (Oh, its happening alright…Sellers and their agents trying to find that perfect balance between house price inflation and not-leaving-money-on-the-table).
  • Buyer’s house hunting struggle is reeeeaaaaaal.
  • Lender appraisals trying to keep up with the increase in market values.

HOW DID WE COMPARE WITH THE REST OF VIRGINIA?

Click on the link for the Commonwealth’s full 2Q 2017 report, compiled by Virginia REALTORS… Virginia Home Sales Report 2Q 2017

 

 

 

* This report was prepared by and for the use of Katherine McNicholas, Westhills Ltd. REALTORS. It is not to be copied in whole or in part without explicit permission of author.*

* All data based on information from the Greater Augusta Association of REALTORS®, Inc. or Multiple Listing Service for the period 04.1.17 through 06.30.17. All information is believed to be accurate, but cannot be guaranteed.*

1Q 2017 Real Estate Market Recap: Augusta County, Staunton, & Waynesboro

Low Housing Inventory Saga Continues…Boosting Sale Prices and Lowering Days on Market

RESIDENTIAL SALES: MONTH -TO- MONTH

RESIDENTIAL INVENTORY: MONTH -TO- MONTH…that red line looks so lonely.

ABSORPTION RATES: MONTH -TO- MONTH…

AVERAGE SALES PRICE: MONTH -TO- MONTH…

HOW DID WE COMPARE WITH THE REST OF VIRGINIA?…

All regions of the Commonwealth noted promising news across the board. Below, are some topline stats when compared to the state’s 1Q 2016…

  • Residential Sales were up 7.8%
  • Total Market Volume was up 12.2%
  • Median Sales Price rose from $249,000 -to- $260,000

Click on the link for VAR’s full First Quarter report… 1Q 2017 VIRGINIA HOME SALES REPORT

 

 

* This report was prepared by and for the use of Katherine McNicholas, Westhills Ltd. REALTORS. It is not to be copied in whole or in part without explicit permission of author.*

* All data based on information from the Greater Augusta Association of REALTORS®, Inc. or Multiple Listing Service for the period 01.1.17 through 03.31.17. All information is believed to be accurate, but cannot be guaranteed.*

Price Adjusting, Low Supply, & Increasing Rates, Oh MY! A 2016 Home Sales Recap…

2016_snapshot

2016 KEPT US ON OUR TOES!

It was very much a “price adjusting” year, with foreclosures being flushed out, inventory running historically low, instability associated with a presidential election year, and wondering when those darn mortgage rates were going to finally rise! A more detailed, localized look below…

**Looking for a broader point-of-view? I got ya covered, VIRGINIA HOME SALES REPORT – 4Q 2016.

INCREASE IN SALES TRANSACTIONS

According to the US Census, (see below), the Greater Augusta County Area has seen little growth in the 2000’s. So, I was delighted to see the 6% increase in closed transactions, (1511 sales) when compared to the 2015 number, (1426 sales). Highest number of sales occurred during 3Q, (463 total transactions.); with the highest selling month being August, (162 sales transactions.) Aside from the natural recycling of households upsizing & downsizing, we have noticed a segment of folks from our neighboring larger, faster growing cities discovering the easy commute & less expensive real estate this area has to offer. (*Count my household as an example… My husband works in Ch’ville, but Waynesboro’s more laid-back & small town ambiance is a better fit for us.)

  • Augusta County’s population growth, from 4/2010 – 6/2015 was, 0.8%
  • Staunton’s……. 2.8%
  • Waynesboro…… 2.2%
  • Harrisonburg…… 7.4%
  • Charlottesville……7.3%

Projected Population Growth by the Decade – UVA Weldon Cooper Center

Projected Population Growth

(*Visit the Virginia Labor Market Information website for additional specific community profiles, featuring demographic, economic, and educational data.)

LOW INVENTORY

So, the big story for 2016 was the ever depleting supply of available residential inventory. The diminished supply began to affect several facets of our market here, (more on that below). The decrease began in Fall of 2015, and became historic in March of 2016. (You can see below, the dramatic increase in Spring 2014, the unfortunate bi-products of defaulted loans were pumped into the market, and continued to be replenished into Q1 2015.)12-16_inventory

Foreclosures, et al. represented approximately 20% or more of transactions in 2011-Q1 2015.) Though we noted a slight increase of their presence in December’s sales, REO’s & foreclosures have been relatively flushed-out & stabilized, (representing ~10% of 2016 total sales.)

Another contributor to the low housing supply, are the homeowners that, (even after a decade or more of homeownership), have little-to-no equity in their properties. According to an extensive 2013 NAHB study, the average residence turnover time is 13 years. If we use that statistic, a large segment of potential sellers purchased their home around the height of the market. Would YOU sell your home if you knew you were going to lose money? Ummmm, no-thankyouverymuch.

 

Low inventory means not-a-thang if you don’t have buyers…Fortunately, we DO have buyers in the Greater Augusta County and surrounding areas…(I mean, who wouldn’t want to live here!?) A great way to visualize this, is with something called an absorption rate chart…it’s a handy calculation using actual sales and available housing supply data, it’s measured in months. Of course, it isn’t that “black & white”, but it’s a helpful tool for checking the pulse.

2016_2015_absorption_ratesThis measurement tool can be focused to compare neighborhoods, price ranges, etc. and can totally vary depending on data set. For instance, if you were getting ready to put your own home on the market…the absorption rate for properties in your neighborhood & price range are both VERY IMPORTANT items to know. It will help both, you and your agent strategically price your home. As a buyer, (let’s say you were looking for a home last December.) Your preferred price range was $150k to $200k.  The absorption rate for that price range was an average of 2.9 months…With that rate, you need to get your sweetlittletushy out to see the property ASAP. With that said, if your price range was $600k-$650k, the absorption rate in Dec. was 24 months, not quite as urgent. I think you get the jist of it…

 

INCREASE IN LAND SALESyearly_land_sales

So, how did buyers react to restricted choice?…They started purchasing stale inventory at cheaper prices, (thus a huge jump in Average Days on Market back in the Spring.) – AND – they decided the alternative to purchasing existing homes, they decided to BUILD. Check out the stats to the left, s’il vous plais…

INCREASE IN MEDIAN & AVERAGE SALES PRICE

This year we noticed an overall increase of 3% in Average Sales Price. The chart below illustrates the increase, continuing into fourth quarter. *In 2015 & 2014, that line dipped in 4Q, creating more of an arc. I look forward to seeing what happens in 1Q 2017…will it continue to rise? (There is usually a pretty dramatic drop-off in first quarter…the holidays wear people out! But maybe 2017 has something different in-mind…)

2016_med_avg_salesprice

DAYS ON MARKET

2016’s Average DOM was a negligible 1.3% less days than 2015. On the surface, this seems nothing to write home about…the real story is 2016’s whopping decrease in median days by 24%. Remember when I mentioned buyers tapping into stale inventory that was overlooked in the past? That inventory has been on the market for several months, in some cases, years. That is a lot of days skewing into the yearly DOM average. The numbers below are another way to view the higher demand…

dom_compare

WHAT TO LOOK FORWARD TO IN 2017…

I’m really, really, really curious to see what happens in First Quarter …Will low-inventory, and the threat of more rate increases, motivate buyers during the usual “slow-down” period? Will the higher interest rates lower sales prices during our high season in 3Q? – OR – Will the lack of supply continue to drop, keeping the demand high? Only time will tell…

Before I leave you with the National Association of Realtor’s 2017 Prediction infographic below, I would like to thank all of those who encouraged me this first year as a real estate agent. I have stepped out of my “homebody” comfort zone, and met some truly wonderful people. Honestly, the word, “clientele” seems so stiff. The families I have met, have become new friends, and what a joy & honor it has been to work with them as a consultant in their home buying/selling process. Its been somewhat of a Mary Tyler Moore moment for me; as I twirl off, throwing my hat in the air…

Ciao – Katherine

 

2017-housing-expectations-12-14-2016-1000w-1453h

 

* This report was prepared by and for the use of Katherine McNicholas, Westhills Ltd. REALTORS. It is not to be copied in whole or in part without explicit permission of author.*

* All data based on information from the Greater Augusta Association of REALTORS®, Inc. or Multiple Listing Service for the period 01.1.16 through 12.31.16. All information is believed to be accurate, but cannot be guaranteed.*