The “bread & butter” housing market remains as tight as ever. 28 new listings came on the market in the past week; while 17 homes went under contract. The net of this is that inventory is up, but only slightly. And 35% of the homes that went under contract this week, did so in 5 days or less.
Anecdotally, we are seeing the same thing. Our open house attendance is through the roof and competing contracts are happening all over Northern VA. Last weekend in Vienna, a home was listed and held open. 72 people signed in to the open house. (This means there were probably well over 100 in attendance since many folks do not sign in.) By Sunday night, there were 11 competing contracts received and the Seller stopped accepting contracts so they could make a decision. And this is not an isolated incident.
On the other hand, combine the upper price ranges with “testing” a much higher price than the market is at, and you may have a recipe for disaster. While the market is brisk, it’s not as swift in the upper ranges. You’ve heard us say a million times that the longer a home is on the market, the less it will sell for. Well, this week’s statistics are a perfect example of that:
- The 3 homes listed at $949,000 or higher averaged 382 days on market! While the remaining 14 homes (listed at $849,000 or less) averaged 29 days on the market.
- The 3 higher priced homes had total price reductions of $100,000 before they went under contract. While the other 14 homes only had a total of $9,000 in price reductions between them! And our guess is that when the sold prices of these homes are released, the difference will be even more stark.
What does this mean for Buyers & Sellers?
It means that BOTH Buyers & Sellers need well experienced Realtors to guide them through the process successfully. Not only should they choose Realtors who are top notch negotiators, but ones who are well schooled in strategies for success (like The Belt Team!) All kinds of issues may arise when there are competing contracts.
For example, Sellers need to be aware that even if they get a contract well above list price, if the contract is contingent upon appraisal, there will likely to be an issue down the line because comps are not yet in place to support rising prices. Sellers will need to evaluate types of financing on each contract, how substantial of a down payment there is, and a myriad of other terms that may ultimately affect the outcome of the transaction.
Sellers in the upper price ranges need to pay special attention to pricing their homes correctly right out of the gate. When you choose a Realtor, choose one who can show you statistics like average days on market and sold-price-to-list-price percentage that are better than average.
Buyer also need someone with creative strategies and who can explain the risks involved when competing for a home. Sometimes buyers get caught up in the frenzy of competition and waive inspections for example. We do not always counsel our Buyers to do this, and there are a lot of factors to take into account before you make a decision.
Contact The Belt Team at (703) 242-3975 for more strategies for success in today’s market.
Here is this week’s Market Snapshot for Vienna & Oakton:
Last week in Vienna Real Estate (22180,22181, 22182):
- Number of Contracts: 9
- Average Days on Market for Active Listings: 133 days
- Average Days on Market for Listings That Went Under Contract: 121 days
- Inventory: 114 homes on the market (a record low in the past 3 years)
- Number of Months Supply of Homes (Based on past 90 day contract rate): 2.3 months
- Number of Months Supply of Homes (Based on past 30 day contract rate): 1.65 months
Last week in Oakton Real Estate (22124):
- Number of Contracts: 8
- Average Days on Market for Active Listings: 115 days
- Average Days on Market for Listings That Went Under Contract: 58 days
- Inventory: 51 homes on the market (down from 53 last week)
- Number of Months Supply of Homes (Based on past 90 day contract rate): 2.5 months
- Number of Months Supply of Homes (Based on past 30 day contract rate): 2.1 months