Second verse (quarter) same as the first. Inventory is the story and becoming a bigger concern. We now have 10 months in a row where inventory for the current month was at least 10% lower than a year earlier. But in this quarter, for each of the 3 months, the inventory levels were over 20% lower than a year ago. Combined with high demand due to low interest rates, prices continue to inch up. There is so little out there for buyers to look at their price point that multiple offer situations are happening more and more particularly below $500,000.
Looking forward, in the short term, I do not see a change in the balance of the market. I think buyers will still be out there due to low rates but I don’t see sellers coming out in force. As prices continue to rise, down the road, that may change. Rising prices will spark sellers in two ways. First, with increased equity, many folks will finally be able to sell and have proceeds to move to the next home. Second, while rising prices bode well for sellers, it also means that the home they want to buy is getting more expensive as well. That, too, can spark immediate action. However, I don’t expect any kind of dramatic shift until next year.
On another front, the foreclosure and short sale arena is changing. In June 2011, of the 1925 homes that settled in Fairfax, Arlington and Alexandria, 13.5% were identified as short sales or foreclosures. In June 2012, that percentage dropped to 10%. That’s another positive sign the market is on the road to recovery.
Here are the numbers:
|Units Sold 2012/% chg||4436 +14.83||2493 +7.4%||2370 +5.5|
|Units Sold 2011/||3863||2321||2247|
|Avg Price 2012/ % chg||650,761 +2.2%||417,574 +2.4||300,028 +6.3|
|Avg Price 2011||636,445||407,808||282,268|
|# Homes for Sale 6/3/12||2349 -16.0%||724 -27.0%||775 -34.0%|
|# Homes for Sale 6/30/11||2797||992||1175|