(See updated chart below)
After listening to Janet Yellen discuss Fed policy and views on the health of the economy, I took a fresh look at what the Vienna real estate stats were showing me.
Now, ever since I took statistics at Boston University, I understand that interpreting those numbers is in the eye of the
fortune teller expert discussing them.
Take a quick look above where I have pointed out that homes for sale (aka new listings) are exceeding homes with contracts (all pendings). There is a increase in the spread over the recent two month period, and as we go into the summer months that spread will remain because that is what I am seeing and hearing from local Vienna agents. The stats in Loudoun County are even more dramatic!
The local real estate market really hasn’t seen a long-term “buyer’s market” in years, and that’s what these numbers represent. Essentially, buyers now have more homes to choose from.
Also, once again I am seeing mortgage rate fatigue where home buyers feel no sense of urgency because rates appear low and may get a little lower.
Talk with your lender about the current deviation in pricing between conforming mortgage rates vs. jumbo mortgage rates because last week the jumbo rates were lower than conforming. By sitting down and crunching those numbers the strategy you had a month ago may need retooling.
My recommendation: don’t squander this opportunity
House price appreciation predictions are kind of like forecasting the S&P 500… everyone hopes you have a better crystal ball.
What I see here in Vienna and most of Northern Virginia is a future of above average appreciation especially if you have a five year or more horizon. Factors include a more diverse employment picture (not just government jobs) and considerable infrastructure improvements like the Silver Line and new buildings in Tysons Corner and Reston. The Town of Vienna has a high bond rating and impressive national reputation thanks to Money Magazine.
The economic base is pretty solid and the demand for housing here is going to continue to increase.
Yes, it comes full circle to that 1926 Chicago Tribune ad: Attention salesman, sales managers: location, location, location, close to Rogers Park.
Let’s track the data
I really don’t want to keep you hanging, so, below is a chart that will automatically update every month from the snapshot above thanks to the good folks at RealEstate Business Intelligence in Rockville. If my forecast is accurate then home buyers should really understand that they are looking in a unique period of time especially since our real estate market can change demeanor in just a few weeks. Yes, the market of the market can turn on a dime!