Watch the video of Kline May Realty's General Manager, Karl Waizecker, talk about the numbers for July's Harrisonburg and Rockingham County Housing Market Report.



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You can also download July's Market Update charts by clicking here. To read Karl's monthly report analysis, go to our previous blog entry by clicking here.

Download July's Market Update charts by clicking here.

As expected, the Harrisonburg - Rockingham County real estate market experienced far fewer closings in July, 2010 than in June. The initial deadline of June 30 for the Homebuyer Tax Credit spurred prospective buyers into action this Spring, with closing dates targeting the June 30 deadline. Some of these buyers were likely "borrowed" from July and August, making it logical to expect lower closing numbers in July and August than would otherwise be expected. This indeed was the case in July, with the local multiple listing service recording 79 sales in July as compared to the 159 sales bonanza in June.

This wild variation from one month to the next is a great example of why it is important to examine periods of time much longer than 30 days when looking for any kind of trend in our local real estate market. Despite what appears to be a dramatic drop in buyer activity in July, total closings for the year remain (slightly) higher than at the same point last year with 696 sales recorded during the first seven months of 201 versus 666 sales through the first seven months of 2009. In what appears to be the reversal of a trend, YTD sales figures in 2010 exceed the previous year's totals at July 31 for the first time since 2006 (see chart - Change in Residential Units Sold). This was true in May and June as well.

With regard to other key statistics in our market, in July the average sales and median prices of properties sold in the prior 12 months fell slightly again to $199,459 and $177,000 respectively. These figures represent a 3 year decline of 11.56% in the average sales price and 11.46% in the median sales price for properties sold through the local multiple listing service. Inventory and Days on the Market remained very similar to June...both at historically high levels.

While the declining prices and high inventory are continued bad news for Sellers, it appears Buyers are beginning to take advantage of the tremendous price, selection and interest rate opportunities. The number of properties under contract indicates August will see more successful closings than July, although nothing like June's high numbers. Typically June and August are the months in which we see surges in closing activity, then September dips again and October and November see good activity until the holidays begin.

What do we expect? First, continued declining sales prices as Sellers compete with short sales, foreclosures and other Sellers willing to dramatically reduced their asking prices to generate a sale. Second, a continued gradual increase in Buyer activity, with increasing investor activity. As these forces slowly work to create balance in the market we will see prices stabilize as well as inventory and Days on the Market begin to come down. It won't be quick or dramatic, but we will get there.

Click here to view or download our Market Activity Charts for July, 2010

Download June's Market Update charts by clicking here.

There has been a great deal of speculation this year about just how much of a surge in home sales would be caused by the Homebuyer Tax Credits. The initial June 30, 2010 closing deadline for Homebuyer Tax Credit eligibility combined with the typically stronger summer market to make June the most productive month for residential sales in nearly three years!

Our local Multiple Listing Service (MLS) reported 159 residential sales in June, the highest monthly total since 190 sales were recorded in August, 2007. Similarly, the residential sales volume in June of $34, 095,068, was the highest monthly total since August, 2007.

Despite the strong sales in June, inventory of homes for sale in both Harrisonburg and Rockingham County swelled to higher levels than we have seen in the past few years. During June, there were an average of 345 residential properties for sale in Harrisonburg and 618 properties for sale in Rockingham County. These numbers are not at all good for sellers, who are still finding they must lower their asking prices in order to attract attention among the intense competition for buyers.

The mix of properties sold in June included a higher percentage of $250,000+ homes than in prior months, bringing the 12 month average price up just slightly to $199,721 from the $199,705 12 month average at the end of May. These figures represent an 11.85% drop in average sales price in the past three years - a far gentler decline than other areas! In our opinion, however, prices will drop a bit further before they level off and begin to rebound, due to high inventory and competition from short sales and foreclosures.

So how much of the June surge can be attributed to the Homebuyer Tax Credit versus the market? We just can't tell at this point. Surely some of the buyers who were able to take advantage of the Credit had been in the market for awhile and the deadline motivated them to act, and some were considering buying in the future but accelerated their plans to meet the deadline. The next few months (without influence form the tax Credit) will give us an indication of the true strength of the market and the balance (or imbalance) between buyers and sellers. Stay tuned.....

Click here to view or download our Market Activity Charts for June, 2010

Download May's Market Update charts by clicking here.

May was an interesting month for local real estate activity. While the sales numbers were a bit disappointing compared to April's numbers, activity was brisk and we expect June to be a very high transaction month due in part to the looming Tax Credit deadline of June 30, 2010. Not all of the recent activity should be attributed to the Tax Credit, however. Great conditions for buyers exist now with plentiful inventory, falling prices and phenomenally low interest rates.

With regard to pricing, we continue to see a slight, but steady decline in average and median price. While very tough for Sellers, the decrease in pricing is good for the market overall, as we begin to reach some balance between the average household income in our area (and therefore the mortgage amount for which a family would qualify) and the price of the average home. In the boom a few years ago this relationship became twisted with the rapidly increasing prices. Market forces dictate that prices had to fall.

On May 31, 2010 the average price of home that had sold through our local Multiple Listing Service (Realtors) was $199,705 and the median sold price for the same period was $178,450. These numbers represent a 5.6% decline in the average sales price in our area over the past 12 months. We expect prices to fall a bit more, maybe 3 - 4% before they stabilize.

Click here to view or download our Market Activity Charts for May, 2010.