Northern Virginia Housing Market Report - July 2022
Major Changes ?
The Northern Virginia housing market continues to show an overall decline as interest rates rise, although the numbers are not quite as dramatic as many have expected.
The Monthly Supply of Inventory has increased throughout the region. In Fairfax County, July had 1.4 months of inventory on the market, compared to 1.3 last year. Arlington’s July MSI was 1.9, up about .2 Year over Year (YoY). Prince William County’s July MSA was 1.3, Fauquier had 1.8, Stafford 1.3, and Loudoun 1.3, all up modestly YoY. Alexandria County was the one outlier, with a 1.1 July MSI, slightly lower than a year ago.
Alexandria County had 257 homes go on the market in July, 136 went under contract, with a median sold price of $547,700. Fauquier County had 109 new listings, 68 went under contract with a $547,300 median sold price. Loudoun County had 725 listings, 364 under contract with a median price of $682,500. Stafford County had 333 listings, 196 went under contract with a median price of $490,000. Prince William County had 866 new listings, 447 under contract for a median price of $527,000. Arlington had 356 new listings, 144 under contract with a median price of $738,000. Fairfax County had 1,794 new listings, 888 put under contract and a median price of $649,500.
Although the number of listening and overall volume has dropped, the data shows that homes throughout Northern Virginia are still selling quite quickly. The average Days on Market before the homes sell is between 12 and 17 for the majority of the counties in the area. The one exception being Arlington County with an average of 21 DOM, but that is still an historically low number, especially since the homes there usually sell for 40% higher prices than most of the other counties. The bottom line is that we are seeing less volume though they are still selling fairly quickly and prices have not come down to any significant degree.
Further Insights Into the Data
The Federal Reserve Bank has increased interest rates several times this year, and more rate hikes are almost certainly coming. The effect of those rate hikes is an increase of several hundred dollars for an average monthly mortgage payment. The data throughout Northern Virginia is fairly typical if the national averages, volume is decreasing but prices and Days on Market have not decreased all that much yet.
The Fed will raise rates until they see a decline in both of those numbers. If you are going to be making a real estate transaction yet in 2022 or 2023, whether you are buying or selling, it is most likely within your best interest to move sooner rather than later. Sellers will likely not be able to command these high prices much longer, and buyers waiting to get a deal will only end up with a higher mortgage payment due to the interest rate hikes outpacing the price decreases.
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