Loudoun County Real Estate Statistics and News

Loudoun County April Home Sales Down 14% Year over Year, Short Sale Deals Down 41%

There were 380 sales transactions completed in April 2011 compared to 440 in April of 2010.  This is a drop of 13.64%.  The housing market in Loudoun County is heading in the wrong direction as demand dries up in the face of stricter lending by zombie banks.

Foreclosure sales were down 14% as well even though the foreclosure turnstiles were stuck as banks were caught falsifying documents, lying on affadavits and overall being fraudulent in their attempts to steal homes from citizens.  This number should have been down much further if the government would just enforce laws of due process regarding foreclosures.  April 2011 had 50 foreclosure sales versus 58 last year.

Shorts sales continue to be a complete disaster with the government doing almost nothing at all to get the banks to approve short sales.  April 2011 showed 65 shorts sales closes versus 111 last year.  This is a 41% drop off in approved and completed short sales.  More evidence that banks are not fixing the problem and nobody is making them.  This is contrary to any rhetoric coming from the government or from anyone else for that matter.  The short sale problem has been a problem for years and banks have fought each and every attempt to fix this problem.  It will never go away as long as banks buy our congressmen at the state and federal levels.  

Here is a story at MSNBC regarding just how ineffective the government has been in fixing the housing problems.  They are being paid a lot of money to kill any bill that will hold the banks accountable and we as regular citizens are on our own to battle them.

http://www.msnbc.msn.com/id/42881365/ns/business-personal_finance

Preview of Loudoun County Year End Real Estate Statistics

 With the new year only a couple of days away, I wanted to take a preliminary look at how the Loudoun County Real Estate market of 2009 compares to the market of 2008.  There have been many developments over the past year that have influenced the real estate market.  Here are a couple that I feel have made a huge difference to our market:

Tax Credit for First Time Home Buyers - This waste of taxpayer money has created a complete imbalance in the low end inventory levels.  The problem with the market in Loudoun is not demand, it is inventory.  Adding more buyers to the market segment that has had multiple offers for over a year is a total failure.  When you see the inventory levels you will see what I mean.

Bank Indifference - There is currently a huge shadow inventory level in Loudoun County due to the fact that banks refuse to put foreclosed homes on the market in a timely fashion.  This will keep price levels down as home buyers realize that there is still a bunch of vacant homes that need to be sold over the coming months.  This strategy by banks will increase the length of the recovery by 2 or 3 years.

Interest Rates - Rates have remained at historically low levels as the Federal Reserve has continued to be a huge buyer of mortgage backed securities.  This program is set to expire in March of 2010 and then normal market forces will take over and presumably move rates higher.  In the meantime, the rates have kept demand levels higher as the cost to borrow money remains low.

Here is a good breakdown of the government intervention into the housing market.

Recession - Bad news for the country means good news for Washington.  And Loudoun County is no exception as it has reaped the benefits of the democratic efforts to save the economy by increasing the size of government.  Unemployment levels are half as much as other areas of the country and as the government continues to expand, the jobs will be here.   And people will move here to find employment.   

So these four factors continue to push inventories down.  As of today the number of homes for sale in Loudoun County is only 770.  On Jan 8th of 2009, inventory in Loudoun was at 1471.  This is a decrease of almost 50% on top of the previous year decrease of 38%  

But prices for the full year are almost unchanged.  The average sales price of a home this year was $362,349 vs. $367,557.  This is only a 1.4% change.  And the number of homes sold has gone down 13% from 2008.  This year 4283 homes have been sold with 3 days left in the year.  Last year 4927 homes were sold.  And even more striking is the drop off in home sales over the last 4 months of the year.  Since September 1st, only 802 homes have gone to closing.  Last year 1327 homes went to closing in the final four months.   That is a drop off of 40%.  

In my next post, I will take a closer look behind the numbers and try to explain why the market is acting like it is and give you and idea of what to expect the beginning of next year.  Also, I will have charts and graphs of year end numbers once the year is over.   

Quick Statistics for Loudoun County Real Estate

Here are some statistics about the Loudoun County real estate market that I follow on a regular basis as well as some interesting trends that tell a lot about the current market conditions.  

Current Inventory - 922  

At the beginning of August this number went below 1000 for the first time in 3 years and it has continued to go down.  At the start of the year, this number was 1256.

Homes sold since Jan 1 - 3125

This is the lowest number since 2000.  Last year there were 3306 sold in the first 8 months.  2007 there were 3312.  Contrary to what you read in the papers, home sales are not going up, they are just not going down very much.  FYI, in 2005 5291 homes were sold between Jan and Aug.

Pending Home Sales - 1241

This is the number of homes under contract but have not yet settled.  That means there is a backlog of over 3 months of homes waiting to close.  This number has been growing due to the incredible length of time it takes a bank to approve short sales.  775 of the 1241 are short sales. 

Percent of Sales that are Distressed - 38.2%

Of the homes that have sold in Loudoun County this year, 1117 have been classified as foreclosures or short sales.  That number has stayed relatively constant throughout this year but the mix has shifted to more short sales as the year has progressed.

Will Loudoun County Home Prices Continue to Rise?

So far in 2009, the median sales price of a home sold in Loudoun County has continued to steadily rise.  Below is a chart illustrating this price appreciation.

Since hitting a low in January, the median sales price has continued to rise.

This rise in price is most likely a function of the moratorium on foreclosures that began at the end of 2008 combined with less than normal listing activity during the spring season. 

The real question is will these prices continue to rise, hold steady at these levels or drop back down.

Recent developments suggest that the median sales prices will most likely move back down in the short term and languish for the foreseeable future.  The reasons for this are threefold:

1.  Interest Rate Runup - Interest rates have recently run up to the 5.5% level after having held below 5% for most of the year.  This will cause some buyers to hold off making a purchase and might cause some homeowners who wanted to refinance to consider selling instead.

2.  Moratorium on Foreclosures Lifted - The six month moratorium has been lifted on foreclosures so the shadow inventory of abandoned homes is set to start hitting the market very soon.  We are already seeing an increase in those listings in Loudoun.

3.  Talk of $15,000 tax credit - Any buyer on the fence about buying is more than likely going to wait and see if they will be getting a $15,000 tax credit when they purchase.  

Right now, nothing is positive for the real estate market from an economic standpoint.  And with President Obama focused on health care reform and green technology, states continue to face bankruptcy caused by the real estate crisis and the problems haven't been addressed.  Just kicked down the road.

$1Million Listings Just Aren't Selling in Loudoun County

If you have a house listed in Loudoun County over $1Million than you have some serious obstacles to overcome.  The chart below breaks down the absorption levels by price for Loudoun County Real Estate.

It is also interesting to note the low levels of inventory all the way up to $600,000.  This is because of the availability of loans up to $625,000 that are FHA insurable.  

Jumbo loans are very expensive and continue to be a market that has few participants.  

This will continue into the foreseeable future.  Bad for the sellers but good for buyers if you can afford it.  A house that could have sold for $1Million in 2006 can be bought for $650,000 today.

Short Sales Are 34% of Total Sales in Loudoun County

One huge change in the real estate market in Loudoun County has been the proliferation of short sale activity during the first half of this year.  For the month of May 34% of all the listings that have gone under contract were listed as short sales.  This compares to 21% of the listings being marketed as foreclosures/REOs. 

This is a complete shift in the marketplace and represents two things, a willingness of banks to work with homeowners on getting rid of underwater properties and a moratorium on foreclosures that lasted 6 months. 

Less than 6 months ago short sale listings were shunned by a lot of buyers and buyers agents who had become frustrated at the slow responses from the banks.  Many short sale approvals were taking up to 6 months just to get a counter offer.  These frustrated buyers and agents focused on foreclosures as those properties were getting quick responses from the banks. 

A couple of factors have contributed to the shift in sentiment regarding short sales.  The biggest change has been banks assigning more resources to their short sale departments.  This has led to a shortening of the response time to 30-45 days.  Also, there has been an effort by many of the more active agents in Loudoun County to take on the short sales.  The standardization of short sale processing by listing agents has given more confidence in the marketplace that a short sale will be approved by all parties and settle in a timely fashion.

I have personally listed and sold 6 short sales in the past 9 months and have 3 other properties set to close in the next 30 days.  The process has been time consuming in terms of follow up and communication between all parties but the effort has been worth it because the bank avoids a foreclosure, the seller is relieved of a large financial burden and the buyer is getting a very good deal.

Loudoun County Real Estate Prices Continue Upward Trend in 2009

Contrary to what you read and hear regarding real estate prices on a national level, prices in Loudoun County have been trending upward during the first four months of 2009.  The following graphs shows the prices of resale homes in Loudoun County have risen 8% from the December levels.

There is also a significant uptick in April prices which is exactly the opposite of what occured in April of last year when prices dropped 19,772 from March levels.  The April numbers are an estimate based on the current list price of the 352 homes already sold in April and a 97% sales price to list price which has been the rate for the last 6 months. 

 

And while this is definitely an encouraging trend, I anticipate the prices will start to move down again because of the recent lift on the foreclosure moratorium that has kept hundreds of foreclosure properties off the market during the last six months.  Look for those levels to increase going forward. 

And unlike others who report foreclosures levels dropping dramatically, I don't think this will be the case going forward as the economy continues to shed jobs.  Prices here will fare better than anywhere else in the country but will probably languish as the overhang of supply from abandoned and vacant houses hover over the marketplace.

Loudoun County Real Estate Stats - Feb 2009 - Part2

There were several excellent questions about Loudoun County Real Estate Statistics from the readers and I decided to answer them in a Video Post.  The questions were regarding the percentage of sales that are foreclosures and short sales, sales prices and active inventory pricing.

Loudoun County Real Estate Price Declines Vary Wildly by Zip Code

Depending on where you lived in Loudoun County in 2008, the value of your house could have changed as little as 5.5% or as much as 36%.  Here are some interesting observations from the data:

The 20164 zip code was heavily impacted by foreclosures and the dramatic drop in sales prices is reflective of that.  And while prices dropped 36%, the number of homes sold increased 100% (231 vs 116).

The newer zip code of Ashburn (20148) saw half as much decline as the older zip code (20147).

The South Riding area of Loudoun County (20152) held up the best during the year.

The 20176 zip code of Leesburg had a 26% drop in prices even though it contains the River Creek, Lansdowne and Raspberry Falls communities.

With Loudoun County Tax Assessments be mailed out in February, this data can be used as a baseline by homeowners to guage how accurate their 2009 assessments are.  It will not tell you exactly how much your specific subdivision or community has changed during the last 12 months but it will let you know if a further analysis is warranted. 

Loudoun County Sales Price Changes
by Zip Code
	Q4 2008	Q4 2007	∆
20147	$337,548	$408,300	-17.3%
20148	$447,405	$481,850	-7.1%
20165	$343,178	$424,317	-19.1%
20164	$197,371	$307,785	-35.9%
20176	$339,230	$461,002	-26.4%
20175	$365,502	$415,864	-12.1%
20152	$452,520	$478,875	-5.5%

 

Loudoun County Real Estate Inventory Levels Down 38%

The current inventory of homes for sale in Loudoun County sits at 1471 as of today.  This is almost 1000 less than the same time last year when levels were around 2400.  This represents a drawdown in inventory levels of about 38% in the past 12 months.  This bodes well for prices going forward.

The real estate market in Loudoun County is stronger than almost every market in America when you look at inventory levels and current supply.  In December 360 homes went under contract.  That means we currently have a 4 month supply of homes on the market.  Depending on which source you read, national levels are almost 12 months of supply.

Also, prices here are holding up relatively well in most zip codes.  Homes in Indianapolis, Cleveland and Detroit are selling for as little as $3000.  In our area there are only a few areas that have homes below $100,000.