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The year just concluded may have left a sour taste in the mouth, but the local real-estate market showed ongoing strength as 2020 morphed into 2021.
It marked the end of a year filled with twists and turns, in real estate as in every other facet of daily life.
“Defying expectations, the 2020 housing market in Northern Virginia was a powerful driver of the region’s economy,” said Derrick Swaak, partner and managing broker with TTR Sotheby’s International Realty in McLean and 2021 president of the Northern Virginia Association of Realtors (NVAR).
“Even with the downturn we experienced in the beginning weeks of the pandemic, the NVAR region housing market had an incredibly strong year,” says Swaak.
December did its part to help: The 1,955 homes that went to closing across the region represented an increase of 28.2 percent from a year before, according to NVAR data. Figures represent sales in Arlington and Fairfax counties and the cities of Alexandria, Fairfax and Falls Church.
Year-over-year sales were up in each of the jurisdictions except the relatively small city of Fairfax. In fact, each of the major jurisdictions – Arlington, Alexandria and Fairfax County – saw increases of more than 25 percent.
That strength (unusual for the last month of the year) was due to a market that continues to see buyer interest due to low inventory, plus the residual demand following the COVID lockdowns of spring.
“December is typically a month marked by lower new contract activity, as consumers avoid making decisions about buying or selling properties during the holidays. But this year we saw an extension of the busy fall market right up through the end of year,” Swaak said. “Sellers continued to list properties in December, and home buyers continued their housing searches through the holidays and eagerly entered into new contracts.”
The average sales price of $676,724 across Northern Virginia recorded for the month was up 5.4 percent from a year before, boosted by a 24.6-percent increase in Alexandria. Fairfax County saw a 3.8-percent increase; Arlington and Fairfax City largely were flat; and Falls Church saw a drop of 11.1 percent.
The increase in buyer frenzy and resulting higher prices have led prospective sellers to test the market. New listings coming onto the market in December were up 53 percent from the (albeit low base) of a year before. That’s a higher year-over-year increase than in recent months; new listings from August through November increased by 26 percent, 30 percent, 42 percent and 40 percent, respectively.
Even the Christmas-to-New-Year’s period was active. During the last week of December, showing activity in areas of Virginia served by Bright MLS, the region’s largest multiple-listing service, were 252 percent above showing levels during the same week in, according to Bright.
“The combination of pent-up demand from the early days of the pandemic along with historically low interest rates and more homes on the market were contributing factors,” said NVAR CEO Ryan McLaughlin.
Optimism is high that the trends will continue.
“With mortgage rates at historic lows, the stock market remaining strong and buyer demand unabated, we don’t foresee any conditions that would dampen the strong market going into the first quarter of 2021,” Swaak said.