While backward-looking data – home sales – looked good across Northern Virginia in July, there are some forward-looking cautionary tales that popped up.
“July buyer and seller activity had a slight cooling effect on Northern Virginia’s hot real-estate market,” said Derrick Swaak, 2021 president of the Northern Virginia Association of Realtors (NVAR) and a partner/managing broker with TTR Sotheby’s International Realty in McLean.
“We began experiencing this moderation in activity ever since the July 4th weekend,” Swaak said. “At this point, it’s not yet clear whether it is the result of both buyers and sellers taking a break and going on some much-needed vacation, or if the market change is more permanent and will continue into the fall.”
A total of 2,536 homes sold in July 2021, a 6.7-increase above sales in July 2020, when the market already had heated up following the inital blast of the COVID crisis and resulting government-mandated lockdowns.
Year-over-year sales were up in Arlington and Fairfax counties and the cities of Alexandria and Fairfax, down in the city of Falls Church. Sales prices also were up year-over-year:
• The average sales price across the region in July was $724,183. • The median sales price was $639,950.
Prices were up in every locality except Falls Church (where the relatively small number of sales each month leads to larger swings up and down) and Arlington (where a larger percentage of total sales in July were in the less-pricey townhouse and condominium sectors than the single-family sector).
Showings dipped toward the beginning of the month, rebounded mid-month, then tapered off towards month-end, based on appointments tracked by ShowingTime and reported by Bright MLS, the region’s multiple listing service.
“We’ll be watching closely to see how market activity responds to factors such as weather, the pandemic and the start of the school year,” NVAR CEO Ryan McLaughlin said.
While there are some signs that the market is regaining its equilibrium, prognostication about the future may be a challenge because, for the past year, “our current market has not been following traditional seasonal patterns,” McLaughlin said.
It remains a sellers’ market, with the equivalent of just a one-month supply of housing available for prospective purchasers. While that is slightly higher than a year ago, it would need to be about three times as large for it to be considered a balanced market, and perhaps four times as large to tilt the advantage toward buyers.
The NVAR Midyear Market Forecast, developed in conjunction with the George Mason University Center of Regional Analysis, suggests that the median price of homes among all home types will continue to increase, but at a more modest pace, for the remainder of the year, although there is less certainty related to condominium pricing.
“The slowdown seems to be affecting condos more significantly than single-family, detached homes,” Swaak said.
The condo market of the “urban village” corridors of the inner suburbs has lagged the single-family and townhouse markets for much of the COVID era, perhaps because prospective purchasers are willing to trade away the close-in location for a property that had a yard (and presumably more health security) around it.
For the first seven months of the year, sales across Northern Virginia totaled 15,664 (up 33 percent from the same period in 2020) and total sales volume was just a hair under $11 billion, up 41 percent. Those big boosts are not surprising, given that while the derailment of the local real-estate market in the wake of COVID was relatively brief (March to June 2020), it was not inconsequential.
Figures represent most, but not all, homes on the market. All 2021 figures are preliminary and are subject to revision.
For full details, see www.nvar.com/marketstats.