Northern Virginia Real Estate Market Update
Week 34 | August 16 – August 22, 2020
It’s been 23 weeks since the Northern Virginia Real Estate market was “NORMAL”. This post will look at the numbers for Week 34 and see just how close we are to 2019’s numbers.
You’re going to be pleasantly surprised by what this week’s numbers have to say about the real estate market.
Let’s jump in.
Northern Virginia Real Estate Market Report | Week 34 | August 16 – August 22, 2020
The major difference from 2019 to 2020 is the pandemic.
When I’m online, I’m starting to notice several real estate agents, loan officers, and media outlets comparing weekly numbers to last year’s figures. This method of reporting is misleading because it forgets to address the fact that our inventory shifted a few weeks due to the pandemic.
Of course, this week’s numbers look better than last year’s number. The question we need to answer is, why?
It’s easier to see where the market started to shift through charts and graphs, but before we look at the graph, let’s agree on one fact.
The pandemic wasn’t real until March 13, 2020. That’s the day Fairfax County Public Schools closed its doors for the year.
This fact will help us understand that the 11th week of the year is an anchor point for all changes in the Northern Virginia real estate market.
Look at the chart to see that new listings up to this point in time were relatively the same as last year.
Let’s drill into week 11 to see how the numbers can be manipulated to tell a different story.
If you isolate these numbers from the rest of the data, it looks like the Northern Virginia Real Estate Market is on a tear. Reporting the 5.5 per increase massages the numbers in a manner that can lead you to make decisions that are not in your best interest.
To make sense of the market shift being caused by the pandemic, we need to look at the Year-To-Date numbers.
New Listings and Pendings were only off plus and minus one percent. Withdrawn listings have been crazy since the beginning of the year with no rhyme or reason. Despite the Withdrawn listings being out of whack, Pendings are still in on pace to match last year.
When you look that Year-To-Date numbers up to this point in time, you could conclude that the market is going to be the same as last year.
Now, let’s look at where we are today in week 34.
New listings are down by 7% year-to-date. Which is impressive given what our market’s been through this year.
The real story in the data is Pending listings are less than 2% off from last year’s numbers. What’s not obvious is that there are drastically fewer listings on the market this year than in 2019.
Even when you consider that we have 2,376 less real estate listings this year, we also had an additional 2,160 listings de-listed over the same time while only having 378 fewer listings go under contract.
What does this mean?
Let’s introduce a new term I’ll be using in upcoming videos called, “CarryOver Inventory” or COI for short.
To calculate the COI you subtract Pending and Withdrawn listings from the New Listings on the market. This figure carries over into the current pool of active listings. COI is important to compare available inventory levels at a given point in time.
When we look at the COI for Week 34, we notice that there’s 60% less inventory in the market compared to this same time last year.
What do numbers tell future home sellers?
With record low inventory and similar pending levels, you should not anticipate a slowdown this fall in Northern Virginia. To take advantage of the record low inventory price your home higher than the comparable market analysis completed by your real estate agent.
Click here to start the process of understanding your Northern Virginia Seller Closing Cost using the calculator on my website. It’s a great place to begin the home selling process with the end in mind by anticipating how much money you’ll make when you sell your home.
What do numbers tell future home buyers?
Buyers should expect a rough time finding a home and competing with multiple offers. You can expect to place bids on several homes as we go into the Fall Real Estate Market.
And, that’s what the numbers say about week 34.
What do you think the numbers say about the Northern Virginia real estate market? I’d love to hear your thoughts in the comment section.
If you learned something from this article be sure to share it with a friend.
Thanks for reading and I’ll see you next week.