This fall has brought a continuation of what has been a trend in Real Estate in the New River Valley (and really all over growing markets across the country). Especially if you are a buyer, what I’m about to say is going to be no surprise for you. But, hopefully can put some explanation to the frustration you have experienced trying to put an offer in on a house only to have it sell out from under you for more than you ever thought it should sell for!
The Bottom Line: Inventory (aka the number of houses that are available to buy in a given real estate market) is down and the number of interested buyers is up.
The Result: Homes continue to sell at historic highs and they sell very quickly.
The Conclusion: It continues to be a seller’s market in the NRV - especially Blacksburg.
Here are some key stats for single family homes, 3000’ or less sq. ft, that sold for under $300k:
The number of homes on the market are down 14% from this same time last year
The average sales price rose 5% (that’s great appreciation for just 1 year!) from $203k-$213k
And here’s a BIG stat - the average days on market fell from 37 to 10!
Because of this, homes have gone from selling for 97% to 99% of their list price.
What does this mean for me?
… if you are a seller:
If you are a homeowner (or investment property owner), and have thought about when might be a good time to sell, now is that time! I am currently working with a family who just added a beautiful new baby and has outgrown their place and decided to list now to take advantage of this great market.
Could next year be better than this year? Absolutely. For the past few years, people have commented how this increasing market can’t go on for much long … but it continues to. At the same time, no one knows the future, but we do know the present. And at the present moment, if you bought your home more than 3 years ago, you have a good chance of capturing the reward of a good investment in this market.
Please reach out to me if you have any questions about this I can answer!
… if you are a buyer:
Think long term. If this is a house you could see yourself in for the next 10 years, then maybe it is worth overpaying for to go ahead and get in. Most likely, 10 years from now in our area, with the growth of industry and universities, you will have made a sound financial purchase. But, keep in mind that most folks stay in a home 5-7 years and then move.
Think about your budget. It is not worth it to get into your dream home only to be house poor and have to eat Ramen Noodles every day for the next 5 years. Not that I have anything against Ramen Noodles - I just want it to be my choice whether or not I eat them. My suggestion would be that you budget for your PITI (basically your mortgage + taxes + insurance) to be between 25-30% of your gross income. If you’re in that range and it’s the perfect place, it might be worth it to splurge a little to get it.
Get pre-qualified! With homes going as quickly as they are, make sure you have already talked to a local lender who has given you a letter saying that you are pre-qualified for at least as much as the house you are offering on will sell for. In today’s market, some sellers will not look at your offer without this. Connect with me if you have questions about how to do this!
How long do you think this seller’s market will last? If you have any questions I could help you with, don’t hesitate to reach out to me by clicking here! Don’t forget to sign up for my email list on the sidebar to the right to make sure you get more helpful content like this.