Tug-of-War in the Northern Virginia Real Estate Market: What Buyers and Sellers Need to Know. There is volatility happening in our local real estate market and you can feel it when you are working with buyers and sellers. The tug is between sellers who just aren’t all that interested in selling & buyers who are experiencing the elevated mortgage rates driven by the Fed.
Buyer demand for homes has remained steady despite low inventory & high rates because rents keep going up! While affordability concerns have sidelined some buyers, others have remained in the market and have been the driving force for the continued “sellers market”.
Buyers are adapting to the higher interest rates and although NO ONE likes to hear this rates are still historically low compared to even the 1990’s. Top that off with the prediction that home prices are going to soar in the not too distant future once rates settle back down, some buyers say they will pay a higher mortgage now, refinance in the future and take the short term hit for the long term equity gain.
Some sellers may be concerned about the future of the economy as we enter an election year. Additionally, the stock market has been volatile lately with recession concerns. Leading some sellers to hold off on selling their homes until the economy is more stable.
Some sellers may simply be happy in their homes and not want to move. They may have lived in their homes for many years and have built up a lot of equity. They may also have strong ties to their community and not want to leave.
There are a number of reasons why sellers might not want to sell their homes right now in 2023. It is important for sellers to weigh all of the factors involved before making a decision about whether or not to sell.
The Northern Virginia market is being driven by a number of factors, including;The strong economy, the high demand for housing and the low inventory of turnkey homes for sale.The real estate market is expected to remain vigorous through 2023 but not too crazy. In my opinion, there are great opportunities for sellers and there are even opportunities for buyers and the tug of war will continue for the foreseeable future.
One fact remains that having a Realtor like me on your side is the best first decision you can make. I can listen to your needs, establish a plan for success and help you execute a buy or sale. Call me to discuss your future real estate plans.
Northern Virginia Market Update AUG 2023. This year has been so bonkers! We have seen rates steadily increase this year yet we have also seen home values rise. High mortgage rates are definitely having an effect on the Northern Virginia real estate market. The market has slowed down considerably, with fewer homes selling quickly, and contracts being accepted for asking price with seller paid closing costs or inspections included. This is due to the fact that buyers are now having to pay more interest on their mortgages, which makes it more expensive to buy a home. Currently rates just topped out at 7.09% As a result, some buyers are being priced out of the market, while others are taking a step back to see how the market will continue to develop. Overall, experts agree it is still better to buy now than wait! Unfortunately, high mortgage rates are also making it more difficult for sellers to get the escalated prices they want for their homes. As a result, some sellers are holding off on selling their homes, hoping that the market will improve. It is still a good time to sell. Sellers need to be realistic with pricing right now. If a home is priced properly, in a great location & is 100% turn key, chances are it will sell quickly even with the current market conditions. It is important to note that the Northern Virginia real estate market is still strong and up overall 3.6% from last year with an average home price around 700k! Many sellers are sitting on equity & that may drive the next wave of sellers. In addition, there is still a lot of demand for homes in our area because we are coming into an election year and we live in a very job driven, transient area. So, while the market has slowed down, it is not expected to crash. A matter of fact, 2024 real estate predictions show home prices increasing substantially once again. My advice is don’t worry ! Keep putting one foot in front of the other and if you want to move or buy something new go for it. Make sure you have your trusted Realtor by your side so that you can manage risk, have a plan for the future and help ensure you are making a wise real estate investment that will set you up for success for the future.
A seller is responsible financially for all the preparation of their home. However, a talented Realtor can help you determine what updates and improvements are going to be the best investments to get the best return when you sell. A big perk to my sellers is my access to quality vendors who can turn around projects quickly & stay within budget. I also encourage my sellers to stage their home. A stager will come in and help the seller see the vision of the “market ready“ home. My staging professional will generate a staging report with room by room instructions to follow when preparing the home. The staging consultation is free for all of my sellers.
Does your home have eye popping curb appeal? If not, take the steps necessary to make it appealing. How does the kitchen look and how do the bathrooms look? These are key rooms that buyers will be evaluating when they are looking at and considering an offer on your home.
Thoroughly clean out your home or hire a maid to clean the home before the home is staged
Paint your home inside and outside
Update or replace flooring
Make lighting changes
Repair systems in your home
Upgrade places like kitchens and baths
Maintain your yard
Preparing your home for sale can increase its value, shorten the selling process, and make you more money! It is important to bring in your Realtor as early as possible so that you can come up with a plan that works with your timeline to maximize profits and reduce headaches! Reach out to me today if you want to sell in a year or more!
Do you stay in other people’s investment properties when you vacation? Maybe your last stay in an Air BNB made you start thinking about buying an investment property of your own? How do you buy an investment property? Many people ask me how they can go about buying real estate investments, so I thought it would be a good time to go over a refresher on how to acquire your first investment property.
When purchasing a home, one of the first factors to consider is location. Owning a home that is close to you will make it easier to manage, as you can easily check on it and address any issues that arise. However, this can also be time-consuming and not always enjoyable. Alternatively, you may want to purchase a home in a vacation destination as an investment. However, if you are not planning to live in the home full-time, you will need to consider who will handle any problems that arise when you are not there. Ultimately, the decision of whether to purchase a home near or far from where you live depends on your individual needs and preferences.
Second, how will you afford a down payment for the investment property? As an investor you will need more money down, in the range of 25%. You will also need cash on hand to be able to float the property even if there are no renters using it. A good rule is to have 3-6 months of expenses on hand for the lean times. Make sure you understand what the operating expenses will be on your investment and how much you can charge for rent on the home. There are some handy online tools that can help you analyze the numbers and see if they make sense.
Third, determine who is going to manage the property. If you are going to manage it yourself how will you accomplish that? If you are going to hire a manager, find out how much that will cost and what benefits that will provide you. Managers can take over ¼ of your profits so professional property management makes sense.
Lastly, determine who is going to handle the day to day management of the property you acquire. There will be bills, taxes, insurance, turnover, the need to place renters, marketing & advertising, repairs, renovations, and all sorts of time consuming things so know who and how you are going to take care of the everyday task.
The Fed has thankfully ended ( at least temporarily) their rate hikes but has said that there will be more rate hikes planned for the future which is not what buyers want to hear. Right now mortgage rates are sitting around 6.9%. Mortgage applications are up right now for the month of June but overall are down 27% from this time last year.
The upside for sellers is that home values are steady, and up 0.7% from last year making the average home price in our area $690,000. The demand for good homes is still strong in our area with many homes going above asking, getting multiple offers and going under contract very quickly.
What does this mean for you if you are thinking of making a move in 2023? For buyers it means having patience, making sure your financing is strong and when you do find a home that you are able to move on it quickly and capture the best rate possible.
For sellers it means putting some thought into the selling strategy and working with a Realtor who can guide you through a successful sale. The 3 most important factors when selling today are price, upgrades and presentation so make sure each of these is just right so you get your home sold.
If you or someone you know needs real estate advice, is thinking of selling or jumping into the market please reach out. I would love to help.
