Click here to download Market Update charts for December 2012..
While closed residential sales slipped to 56 in the month of December, 2012 finished with 864 sales representing an 8.8% increase over 2011's total of 794 sales and a higher total than 2010 (758 units) and 2009 (818 units) as well. In addition to an increasing pace of sales, it appears the long, slow decline in home prices is over. The average and median sales prices remained essentially flat in 2012. The average sales price was $193,484, a 0.81% decline from the 2011 average of $195,068. The median sales price, however, rose slightly to $175,000, a 0.58% increase over the 2011 median price of $174,000. However, it is important to note there was a transaction involving 22 condominiums which sold for a very low price to a single buyer. While this was truly a commercial transaction between investors, the condos were on the market individually as residential properties, so they are included in this report. If we eliminate this transaction from the year's sales figures, the average sales price would have risen 1.3 % to $197,676! We believe this is the true residential trend and it is likely home prices will continue to increase in Harrisonburg and Rockingham County in 2013.
Buyer activity was markedly stronger in 2012 than in the past few years. During 2012 Buyers placed contracts on 981 properties, a 20% increase compared to the 2011 total of 817. In December, 69 residential properties went under contract, a very good number for this time of year ( the 2011, 2010 and 2009 December contract totals were 36, 40 and 44 respectively). With interest rates forecasted to remain at historic lows and consumer confidence returning, we expect even stronger Buyer activity in 2013.
Combined with stabilizing prices and increasing Buyer activity, we now find our market with a very low inventory of homes for sale as compared to prior years. The daily average inventory for December in the City of Harrisonburg was 197 homes for sale and the daily average for Rockingham County was 386 homes for sale. Both of these are the lowest monthly figures in the past few years and will create an improved market for Sellers in 2013 (fewer homes for sale + an increasing number of buyers = better prices for Sellers!). As of December 31, the one and three year price trends are:
Three year change: Average Price down -9.64%, Median Price down -5.91%
One year change: Average Price down -0.81%, Median Price up 0.58%
At long last, we are recovering from the real estate market "crash". Prices have stabilized, the market is becoming more balanced in terms of the number of Buyers and Sellers, and Buyers are continuing to take advantage of outstanding financing options allowing them to lock in a historically low interest rate for up to 30 years. We are thankful for the successes of 2012 and look forward to a good year in 2013 where we expect to see more buyers in the market, a declining number of distressed properties locally, price appreciation for local homeowners and possibly even the return of new construction projects to our market. Stay tuned....
Click here to view or download our Market Activity Charts for December 2012.