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Slight diversion from our typical community-related post in order to update you all on the current state of the real estate market in our area. Derik and Jeremy are real estate agents with Kline May Realty in Harrisonburg, VA. Each month our principal broker, Karl Waizecker, puts together a market report for the area. Below is the report for May 2013.
The Harrisonburg and Rockingham County real estate market seems to be strengthening at an increasing pace as we head into Summer.
The numbers for May, 2013 show continued strong sales with 95 residential closings for the month and 379 residential closings for the first five months of the year – both figures representing a dramatic improvement over prior years. In fact, sales through the first five months of the year are 25.91% ahead of last year. I expected an increase in sales (around 10%) in 2013 due to the rebounding market but have been pleasantly surprised by the tremendous activity this year. The number of homes going under contract in May took a big jump to 143, indicating June and July will be very strong months for closed sales as well.
So, one logical question withall of this activity is “Are home prices on the rise?” (The answer is not as simple as you may think.) Because of the relatively small size of our market, when we look at pricing trends it is important to look at a time period long enough to yield enough data to see trends emerge. For the purposes of this report we use a 12 month average, which has not yet shown a clear upturn in prices. However, the buyer activity we see clearly indicates buyers realize the urgency in the market now and are making much more aggressive offers, and agreeing to pay higher prices, than last year. For this reason, coupled with continued low inventory, I believe prices are actually beginning to increase and we will see this reflected in the longer term numbers later this year. Our current pricing trends remain flat, though:
Three year change: Average Price down -7.49%, Median Price down -4.81%
One year change: Average Price down -1.59%, Median Price down -0.54%
Inventory remains low, presumably as sellers wait to see prices increase before entering the market. Another factor affecting inventory for
sale is the refinancing boom which has occurred over the past few years. Many homeowners have locked in low payments and decided to
stay in their current home. For these reasons, it appears we will not have the traditional summer increase in the number of homes for
sale…which will increase upward pressure on prices as long as buyer demand remains high.
Click here to view or download our Market Activity Charts for May 2013. Please disregard the 2012 date on the first slide.
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