Here in the close-in Northern Virginia market, (which is composed of Fairfax & Arlington Counties and Alexandria, Fairfax & Falls Church Cities), the lack of quality inventory is THE story now. This is particularly true in the $500K-$300K and <$300K price ranges, where available inventory is down (19%) & (37%) respectively, but new contracts for January came in at 1% & (12%) respectively. The drop in contract activity is believed to be related to the lack of desirable listings at this point, as opposed to a reduction in the desire to buy. Open house attendance for the Arlington office of McEnearney Associates has been very since the start of the new year.
Cries of a buyers market have long faded away in all price points except the very high end. In fact, below the $1M price point, the market is decidedly a sellers market with multiple contracts & escalation clauses becoming fairly standard again. The drop in available units in the two lower price points mentioned above, coupled with relatively stronger sales in the month, has led to a depleted inventory to below a 2 month supply. The bar graph below shows Months’ Supply for 1/2011 vs. 1/2012 by price range.
Overall, the Northern Virginia real estate market will be driven by employment, just like other locales across the country. The presence of the Federal Government, Contractors to the Government, and Military installations have provided greater stability of employment and liquidity in the market with a steady stream of people locating to the region & transferring out. The forecast is for this to continue into the foreseeable future, so the future continues to look bright for real estate here.
*Statistics are courtesy of McEnearney Associates, Inc. and based on MRIS data, which is deemed reliable but not guaranteed.
If you would like additional information about your specific neighborhood, as all real estate is local, please contact me and I would be happy to personalize this information to your needs.