A 25 Year Low.
That's the number of houses for sale over the last 2+ years in the Northern Virginia real estate market. However, does the Past indicate more inventory in the next 2-3 years?
Historical sales data suggests the answer is Yes to more inventory.
2023 & 2024 annual sales were significantly below the historical average dating back to 2007. FYI, the 2000-2006 annual sales were significantly higher (upper 20Ks/lower 30Ks per year) due to the “have a heartbeat, you have a loan” market during those years.
The decline in annual sales was due in part to the “Rate Lock Effect,” with expected sellers deferring their sale to avoid exchanging a 3% mortgage rate for a 7%+ rate.
A less considered cause of the annual sales decline is that some sellers moved up their selling window into 2021 for a sale that would have occurred in the following 2-3 years.
The 2020-2024 five year annual average sales are not significantly lower than historical averages, due to so many sales being accelerated into 2021.
Unless the 10-15 year historical fundamentals of buying/selling in the Northern Virginia market have been forever altered, it seems likely that our market will trend back towards the pre-Covid average annual sales.
If we return to historical norm, we are looking at an increase in sales in the 20-37% range depending on the average annual sales number used (approximately 19K to 22K).
Of course, 2023-2024 could be the first 2 years of a “new normal.” However, it seems more likely that the next 3 years will average higher than the last 2 years when you consider the historical sales & demographic data.
Who You Work with Matters.
The current inventory situation poses challenges & opportunities for both buyers & sellers to consider. The quality, credibility, & experience of your agent will have a decisive impact upon your selling or buying outcome. Depth of market knowledge is a key to success.
However, market data is meaningless without a top-tier real estate professional to interpret what it means - & just as important, what it does not mean - in your particular buying or selling circumstance.
Contact me to help you with your real estate needs.
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