Local Real Estate Market, Winter 2013/2014
Northern
Virginia ; Washington DC
The market generally recovered in this area
during the last year after bumping along the bottom for several years. Prices rose in all areas of the region. The past Spring 2013 saw a huge burst of
activity and prices rose dramatically from their lows of 2010 and 2011. The interest rate burst of the early Summer
slowed sales somewhat through the Fall 2013.
It was hard to sustain the peaks of the Spring. Renovated and well-presented homes are sold
more quickly throughout the year. Bank
foreclosures sank to a 6 year low; to the same levels as the period before the
Great Recession. This makes it hard to
find foreclosed properties. The number of short sale properties sold shrank
last year and will continue shrink in
2014, now that the tax exemption for sellers has been removed. This all points to a decent market in
2014.
The real estate market is generally expected to
be good during 2014. Prices are expected
to rise about 5%+/-, which is about half
the appreciation of 9%+/- seen during 2013(*1).
In nearly all parts of our region, prices have recovered to at least
their "pre-real-estate-bubble" prices of 2005 (*2). In most neighborhoods in our region, nearly
all the property owners are in good financial standing, and their homes are
worth more than their mortgages(*3). This
means that sellers will only enter the market if they are happy with the
prices. In a few areas the high prices
of around 2007 were met this Spring and in only in a few of these places were
these "high" prices of the Spring 2013 sustained into the Winter(*4).
At this time, there are fewer home on the
market than have been seen since 2007, this will pressure prices upward. However the government is not expected to
continue their quantitative easing or bond buying. Without this support, interest rates are
expected to rise which will lead to monthly payments creeping upward. When you also consider that wages are
generally stagnant and that buyers are now financially conservative, this will
hold down prices. Investors will find it
harder to find bargain properties. The
number of sales in 2014 is not expected to meet the number of sales seen in
2013.
If you would like to chat about the market, and
how this will affect your real estate decision making, please call or email me.
*1 Zillow.com
reports that our region’s prices rose 8.9% during 2013 and are expected to rise
2.3% during 2014. RBIntel reports
that our region’s prices rose 5.5% last year
*4 TaylorBrownAroundTown, January 2014
