This month, the Northern Virginia real estate market is marked by changes and some uncertainty. At the end of last month, sale prices were up 6% from last year but down 2% from last month. It’s also taking longer for homes to go under contract and there continues to be a shortage in homes for sale. Still the Federal Reserve lowered the federal funds rate by 0.25%. And the Consumer Price Index rose to 2.6%. Here’s what it all means for the Northern Virginia Market Update for November 2024.
Consumer Price Index News
The latest Consumer Price Index (CPI) report for November 2024 showed inflation (the cost of goods and services) increased 2.6% over the last year. This is up from 2.5% reported in October. While up, it’s still relatively close to the Federal Reserve goal of 2.0%.
Federal Reserve Announcement
On November 7, the Federal Reserve dropped the federal funds rate another 0.25% in an effort to bring down interest rates.
Mortgage Interest Rates
Since the last Federal Reserve Announcement, mortgage interest rates have been going higher. On November 13, interest rates on a 30-year fixed mortgage was 6.948%. Still the expectation is that the rates will gradually decrease over time.
Statistics and What it Means
Using statistics from MarketStats by ShowingTime, we looked at 10 counties in Northern Virginia – Alexandria, Arlington, Fairfax, Falls Church, Fauquier, Loudoun, Manassas City, Manassas Park City, and Prince William. Here are the highlights for Northern Virginia.
The median sale price for a home in Northern Virginia at the end of October 2024 was $660,000, which is down about 2.2% from the previous month and up 6.5% from the same time last year.
By the end of October, 2,387 homes in Northern Virginia were sold. This is down 11% from the previous month and up 15% from last year.
The number of Days on Market for Northern Virginia is now 21 days, this is 1 days more than last month and 4 days more than last year. It is taking a little longer to get homes under contract.
This month, there are 3,018 homes for sale, which is a 5% decrease from last month and 7% increase from last year.
Inventory Levels
The phrase “Month’s Supply” refers to how many months it will take to sell all the homes currently on the market. Most consider a balanced market, where buyers and sellers are on the same playing field, to be about 3-6 months supply. Currently, Northern Virginia has a month’s supply of homes for sale of 1.3 months. While inventory continues to be low, buyers demand is following.
Bright MLS Buyer Demand Index
According to Bright MLS Home Demand Index, buyer demand in the Washington Metro Area (which includes Northern Virginia) remains “Limited”. The Bright MLS | T3 Home Demand Index measures and tracks consumer and real estate professional behavior related to shopping for real estate. They look at metrics such as the number of views of homes online and in-person showings. Ratings are categorized into 5 score points: Limited (under 70 points), Slow (70-89), Steady (90-109), Moderate (110-129), and High demand (over 130).
For the month of October, buyer demand was predominantly still SLOW across most areas. Still the numbers are increasing from previous months, likely due to lower interest rates. Here are the top 5 in Northern Virginia: MODERATE in Alexandria (112); STEADY in Arlington (108); SLOW in Prince William County (85), Fredericksburg City (74) and Manassas City (74). Loudoun County’s buyer demand is LIMITED (62).
What Does This All Mean
The real estate market in Northern Virginia at the end of October was in a slumber. This is not surprising considering the elections and the mortgage interest rates closer to 7%. The hope is that there may be a slight uptick before the holidays arrive. This season has traditionally been a time when real estate sales slow down.
Advice to Sellers
For homeowners in Northern Virginia, accurate pricing and good condition remain crucial ingredients to ensure a smooth and successful sale. If done properly, expect some negotiation from home buyers, whether it be on price or closing costs requests. Also expect to go under under contract in about 2-4 weeks, depending on where you live. We offer neighborhood-specific advice on pricing and clear expectations to make the process as hassle-free for our clients.
Advice to Buyers
If you’re ready to buy a home, there is a lot of opportunities for home buyers. Since showings are down, some home sellers are willing to negotiate with home buyers at this time. Has anyone taken the time to explain the home buying process in Northern Virginia with you? If not, please reach out.
WATCH RELATED VIDEO
Bottom Line
The market update for November 2024 shows a slowing real estate market as everyone’s attention seems to be on the elections and unchanged mortgage interest rates. We look forward to keeping you informed every step of the way.
Questions/Concerns? Please contact us.
