The wider economy may still be shaky, but the housing sector is enjoying a healthy recovery in Northern Virginia, with home sales and prices up.
In its January 2013 report, the Dulles Area Association of Realtors noted that overall home sales were up 10.7 percent from January 2012. Among townhomes the trend was more pronounced, with a 26.2-percent increase from this time last year.
“Inventory remains low relative to demand in Loudoun County,” said Jeanette Newton, the association’s CEO. “According to our most recent housing market report, there is a drop-off in distressed properties and townhomes took the lead in sales growth in January.”
Homes are selling not only in greater volume but also with greater speed: the median home stayed on the market for 33 days before selling (a figure that is 11 days less than the 10-year average) and fully half of townhomes listed sold within 20 days or less.
“It is a seller’s market by any measure,” said Lisa Sturtevant, an economist who serves as the deputy director for George Mason University’s Center for Regional Analysis. “There is pent-up demand and historically low inventory; about a month or two of inventory in most places. Buyers are looking and not finding, so you’re in a good position if you have a home to sell.”
Sturtevant said that the Northern Virginia housing market began to experience a resurgence more than three years ago and that the regional housing sector resilience is spreading to higher-end properties.
“For something like three years, there has been upward pressure on home prices,” said Sturtevant. “That has been true since late 2009. Nowhere else in the country started back that early. It was a very early start to the housing recovery. The housing market recovered first in the lower-price-point sector, but that’s shifted. We’ve been seeing a rebounding residential construction sector in the region, first in 2011 with multi-family homes and then in 2012 with single-family homes.”
High demand, low volume, and lower-than-average sales times bode well for those looking to put a home on the market. Academics are not alone in observing a palpable recovery; those working on the ground see real signs as well.
Tom Jewel has been a Realtor with Carter Braxton Preferred Properties of Leesburg for 30 years. He painted an optimistic portrait of where the regional housing sector is headed.
“It’s an excellent market to be a seller,” Jewel said. “Because the properties don’t last once they go on the market. They’re selling quickly and with multiple offers. A lot of it is that we have so little inventory.”
The inventory shortage stems from the dearth of new-home construction that began around 2005 and intensified as the recession began in late 2007. As the market recovers, residential building is increasing, but Jewel said the upswing did not resemble the early-2000s housing bubble.
“The housing market is into a healthy recovery right now,” he explained. “There are not skyrocketing prices, but prices are solidifying and rising. In 2012 a big part of that recovery was in townhomes. I would imagine that this year you’ll see single-family homes make up a larger share of that.”
Sturtevant, the economist, cautioned that the recovery could experience disruption if the government failed to take certain steps.
“Right now, sequestration is the biggest potential hurdle,” she said. “There is a set of people in this region whose employment is tied to the federal government, and some of them are facing 20-percent pay cuts. The extent to which sequestration is allowed to continue will determine if the market recovers more slowly in 2013. Overall, though, housing is moving in the right direction. This is a complicated recovery and it’s following a trajectory that’s never been followed before.”
Part 2: The right improvements
Part 3: Opening your home