We recently attended a conference in Austin where national statistics were presented on the housing market. One of the pieces of good news that was presented was the fact that the percentage of homes that are underwater (ie – homeowners owe more than the homes are worth) has dropped significantly since last year.
We closed 2012 with almost 22% of homes underwater across the United States. After the first two quarters of 2013, that number had dropped down to 14.5%. And 7% of properties returned to positive equity by mid-year.
So – what’s happening in Northern VA?
Northern VA has had less homes underwater than many places nationally, but we still have had our share. Well – prices are up, inventory is still fairly low, and interest rates are rising.
This kind of makes for the Perfect Storm.
Rising interest rates could hurt both buyers and sellers. When rates rise, buyers lose buying power. They can’t get as much for their money, it’s harder to qualify for loans and at some point – they drop out of the market. This means demand wanes. When demand wanes, and less buyers are in the market, Sellers have less leverage when selling.
We’re starting to get a lot of calls from savvy homeowners in Northern Virginia who tried to sell (or wanted to sell, but didn’t even try) during the years 2007-2011. They have realized that in many cases, prices are up enough that they can make that next housing move – the one they thought they could make a few years back, but couldn’t. Some are seizing the opportunity to downsize. And some are making a much needed upward move to accommodate their growing families. They realize this just might be the time to put their toes back in the water to see if the numbers work – BEFORE interest rates rise so high that buyers for their home are priced out.
Micro-markets in our area mean that this scenario may not apply to you. For example, there are some areas that are always in demand & insulated from outside market forces. And there are other markets – for example, the luxury market – where demand may not be as swift. If you’re wondering whether you can sell – NOW is the time to consult a Realtor and run the numbers. You may have missed the market last time, but don’t miss it this time.
If you want to take a look at a general valuation of your home before your schedule a consultation – try out our new FREE HOME VALUATION TOOL. You’ll get an immediate online estimate.
Our mission is “Changing Lives For The Better”. If it’s time to change yours, give us a call at (703) 242-3975.