As we near the transition from summer to fall, the signs are all around us: cool evenings, changing leaves, darkness falling earlier. One other effect of the change in seasons is the cyclical movement of the real estate market.
August brought a slight softening in several key statistics for the Northern Virginia market versus the June peak. However, while the market is no longer at its summer peak, Northern Virginia is still a very strong and healthy market, and there is plenty of opportunity to plan your next move.
So let’s take a look at some of the key statistics.
These two charts tell a different perspective of the same story. Active listings reached a 2016 peak in April, although still well off from recent highs in August/September of 2015. Since April, active listings have remained relatively steady, and the month-over-month chart bears this out. The percentage of month-to-month change is relatively unchanged since May, dipping slightly into negative territory in July and August.
Also of note are the closed sales, which enjoyed a steady increase from January through June. July and August saw closed sales level off with minimal to slightly negative change month-over-month. New listings have fallen steadily from the peak in March/April 2016, which historically are very active months for new listings.
When looking at year-over-year changes, what is interesting is the pop in closed sales, which hovered slightly negative in July versus the previous year. In August, both the closed and pending sales hovered in positive territory for year-over-year changes, while the number of new and active listings remained firmly in the negative compared with a year ago.
The decline in inventory is the result of two things: continuing strength of closing and pending sales plus inventory removed from the market as homeowners chose to cancel listings during the busy back-to-school months.
Individual communities within Northern Virginia vary widely from the averages, with Falls Church leading the pack with a 40% increase in sales from August 2015 to August 2016. Alexandria was the only NoVA metro area that saw a slight drop in year-over-year sales.
Good news for buyers in the Northern Virginia area is the slight softening of prices across the region. Overall, prices have been on an upward trend, and average prices remain well above August 2015. Prices peaked in June, which corresponds with the peak in closed sales during the same period, then fell off slightly in July and August.
Year-over-year change is still in positive territory, and remains in a relatively flat trend month-over-month since March.
Also trending within a relatively flat range is the ratio of closed sale prices to original listing price. This is good news for sellers, because they continue to receive strong offers and close sales within a few percentage points of the original list price. The downtick in available inventory likely plays into this, and indicates there is still strong demand in the area for homes.
Days on Market
Days on market hit a peak in the dead of winter at 60 days. This is not unexpected, and the average days on market fell dramatically in March/April, corresponding with increased sales during that time. July and August saw a slight uptick in the days on market, but they continue in a healthy range. On average, homes are selling in less than a month and maintain a very strong pace.
Decreasing inventory will keep prices stable or slightly increasing going into September. Demand remains high, which is reflected in the average days on market and the ratio of selling prices to original list prices. Continued seasonal slow-downs may have a bit of a pop as families planning a move will likely try to do so prior to the busy holiday season. One wild card factor is the upcoming election. We’ll have to wait and see what impacts there may be to the housing market in NoVA, but uncertainty over the impact of the election could cause some potential home buyers and sellers to stay on the sidelines until after the election. Regardless of seasonal fluctuations, the market remains strong and vital.
If you are thinking about buying or selling, now is still a good time to make your next move. We are here to help you every step of the way, and look forward to serving all your real estate needs. Check out our website to view current listings and important resources. If we can help you in any way, please contact us at 703-298- 7037 or email us at firstname.lastname@example.org.