If you've been waiting for good news regarding the housing market, the recent news reports and articles portrayed lately in the media shows definitive progress in the rebound of home prices across the nation.
The most recent report of the S&P/Case-Schiller Housing Index shows a YOY increase of 1.2% in home prices for the month of July in the top 20 major metropolitan markets and of the top 10 largest major metropolitan markets the increase was 1.5%. This would have been the the 4th month in a row that prices have increased if Detroit did not have a .06% dip in April. Some major markets are still struggling but overall great news for the housing industry and home owners in general. Low interest rates coupled with some of the lowest inventory levels in years has had a direct impact on the housing price increases we are now experiencing.
Macro Markets LLC is a company that studies housing prices. Since 2010, they have been publishing a Home Price Expectation Survey. They asked 110 housing industry experts from across the industry to project housing prices through 2016. The most recent 2012 study shows that experts predicted prices to remain relatively flat (so the S&P/Case-Schiller report has been a pleasant and welcome surprise) through 2012. These experts then predict home prices to rise reaching a cumulative appreciation of over 10% by 2016.
So... what does this really mean for the housing market in general? We all know that a strong housing market is one of the major stabilizing factors in a healthy economy. In addition to creating jobs and infusing money into the economy, it puts some homeowners once underwater in their homes in a position to sell their homes and move on to the next chapter in their lives and start rebuilding the wealth and assets needed for long term strategies-ie: retirement, opening a business etc.
In our local market of Alexandria we have been experiencing home price increases and unit sales at an accelerated rate for some time now. Record low inventory, the abundance of ready, willing and able buyers (unemployment just 4.6%-July), and record low interest rates are driving full price, multiple offers on desirable properties as well as significantly reducing the days on market (DOM).
As you can see by the tables below, homes prices have risen at levels 2-3 times the national average over the past couple of years. In some specific zip codes, prices are at or exceeding peak home prices prior to the housing meltdown. The peak avg price for all of Alexandria was $474,000 in Sept 05.
Housing Sold Summary-Alexandria City, VA(22301,22302,22304,22305,22311,22312,22314)Jan-Aug YTD 2011 2012 % Change Sold Dollar Volume $703,332,990 $662,092,608 +6.23% Avg SoldPrice $491,154 $473,939 +3.63% Median Sold Price $460,000 $430,000 +6.98% Units Sold 1,432 1,397 +2.51% Avg Days on Market 62 75 -17.3% Avg List Price for Solds $501,879 $486,125 +3.24% Avg SP to OLP Ratio 96.4% 94.9% +1.61% Attached Avg Sold Price $435,054 $415,899 +4.61% Detached Avg Sold Price $719,934 $721,866 -0.27% Attached Units Sold 1,150 1,132 +1.59% Detached Units Sold 282 265 +6.42%
Year Ending-2010-2011 2010 2011 % Change Sold Dollar Volume $871,271,998 $926,849,757 +6.38% Avg SoldPrice $469,529 $454,024 +3.42% Median Sold Price $430,000 $415,000 +3.61% Units Sold 1,974 1,919 +2.87% Avg Days on Market 74 59 +25.4% Avg List Price for Solds $481,563 $466,955 +3.13% Avg SP to OLP Ratio 95% 95.2% -0.24% Attached Avg Sold Price $414,931 $400,800 -3.53% Detached Avg Sold Price $711,017 $703,878 +1.01% Attached Units Sold 1,610 1,582 +1.77% Detached units Sold 364 337 +8.01%
All signs indicate a strong housing market through 2012 with potentially explosive growth in 2013. Homeowners in Alexandria that have been sitting on the sidelines waiting for prices to increase for various reasons (financial, election, job uncertainty etc) should be thinking about taking advantage of the coming opportunities our local market will present in the early spring 2013!
The Selling Edge-for the latest housing statistics and up to date local market information, please visit our website or Facebook page for more information or to learn how we can help.
Information and pictures courtesy of RBI, KCM and RIS Media