Buy Alexandria Real Estate: Roller Coaster of Real Estate: Northern Virginia Home Prices are NOT in Freefall (except maybe in Prince William County)

Alexandria Virginia Real Estate Blog

Roller Coaster of Real Estate: Northern Virginia Home Prices are NOT in Freefall (except maybe in Prince William County)

Which market are you watching and what news are your reading or watching?

To hear it from the national media, you're bombarded with stories about foreclosures, massive price drops, a downward spiraling economy, recession, Armageddon, doomday, death and destruction.

The local news is not much better.  When the Washington Post reports on real estate, they are often examining the entire region, Suburban Maryland, D.C., Northern Virginia, as well as the far reaches of the outer suburbs.  Parts of Loudoun County may be more a suburb for Reston or Tysons Corner than they are for D.C.

The Real Estate Roller CoasterSure, real estate is a roller coaster ride and it's not for the weary who are in it for the short time and must clench the safety bar and scream the whole way down.  Anybody whose ridden on one of the cars at an amusement park knows that you've got to weather the ups and downs, but in the end you'll likely escape unscathed.

Such is true of the Northern Virginia real estate market.  Cycles come and go, but one fact remains -- over the past 40 years, the average home appreciation in the region has been 7% per year.  2000 through 2005 saw unprecedented double digit appreciation.  Calls were issued that a bubble was about to burst.

Bubble bursting?  Not quite so dramatic.  However, neither was it nor will it necessarily be a soft landing, as other experts suspected.  Home prices momentarily met their peak on the rollercoaster of real estate and have been heading down, but how quickly and how dramatically depends on where you look.  It is important to examine the numbers carefully if you are considering a purchase or a sale in the near future, or even if you are just cautiously watching the market for  a future move.  Reading this blog can be your seatbelt during the bumpy real estate ride.

Real estate prices have been going down, though not across the board. 

 

Always remember the mantra: REAL ESTATE IS LOCAL.  Say it again.  Memorize it and don't forget.

 

 

Here are some cold hard facts and numbers:

Location

 

February 2008

February 2007

% Change

 

 

 

 

 

CITY OF ALEXANDRIA

Average Price

$477,997

$468,556

+2.01%

Median Price

$414,000

$429,950

-3.71%

Sales Price/List Price

92.95%

93.31%

 

 

 

 

 

 

ARLINGTON COUNTY

Average Price

$508,232

$524,538

-3.11%

Median Price

$425,000

$470,000

-9.57%

Sales Price/List Price

93.73%

94.82%

 

 

 

 

 

 

DISTRICT OF COLUMBIA

Average Price

$507,978

$490,276

+3.61%

Median Price

$414,000

$388,990

+6.43%

Sales Price/List Price

92.72%

93.92%

 

 

 

 

 

 

FAIRFAX COUNTY

Average Price

$467,979

$508,545

-7.98%

Median Price

$405,000

$448,900

-9.78%

Sales Price/List Price

91.17%

93.42%

 

 

 

 

 

 

LOUDOUN COUNTY

Average Price

$426,442

$486,292

-12.31%

Median Price

$374,950

$419,900

-10.70%

Sales Price/List Price

90.14%

91.38%

 

 

 

 

 

 

PRINCE WILLIAM COUNTY

Average Price

$307,392

$408,874

-24.82%

Median Price

$275,000

$370,000

-25.68%

Sales Price/List Price

87.64%

93.85%

 

 

 

 

 

 

Distilled to a graphical format, we see that price changes are not that dramatic in most areas, with the exception of Prince William County.  The steep decline in Prince William County values is strongly correlated with the high prevalence of foreclosures in that area.  You'll notice that Alexandria and D.C. actually saw month over year price increases.

Average Home Price Change Northern Virginia -- Feb 2008As a buyer, this market presents some opportunities to get in and purchase a home before the rollercoaster starts climbing the next hill, whenever that may be (we don't have a crystal ball).  If you are planning on living in the area and owning the home long-term, a wise investment may pay off with dividends in the future. 

As a seller, you may expect buyers to make some severely low-ball offers based on their misunderstanding of the realities of the marketplace and the widely overhyped freefall that the media is predicting. 

They hyped the market on the way up and they're hyping it on the way down.  Drama makes news.  When you are buying or selling real estate, however, you need the balanced guidance of a real estate professional.

Just to hammer home the reality of how hyper-local real estate markets can be, take a look at the following chart of price changes in Arlington Virginia.  While the previous chart shows a slight loss in value over the last year in Arlington, take a look when it's broken down by zip code:

Change in Arlington Virginia Home Prices

5 zip codes experienced an average loss in value while 4 zip codes in Arlington experienced gains over the past year.  In 3 of the zip codes where there were average losses, the home price change was barely perceptible. 

Hardly a freefall!

The national news? No.  Local media? Probably not.  A REALTOR who is on the street and in the trenches of the daily real estate market?  There's your best bet for safety on the roller coaster of real estate. 

Give me a call to discuss your real estate needs 703-626-0715

or send me an e-mail for further information.

 

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Comment balloon 15 commentsBrian Block • March 15 2008 08:08PM

Comments

I lived in Manassas in the early 1980's - wow prices are definitely falling!
Posted by Mary Aguilar (David Lyng Real Estate) over 10 years ago
Brian-  Excellent chart.  I was working on something similar for DC - you beat me to it.    This is great information for buyers.  They think prices are falling everywhere... but they are not!
Posted by James Downing - Metro DC Houses Team REALTORS®, CRS, GRI, ABR,MRP, MilRes, When Looking to Buy or Sell - Make the Right Move (Real Living | At Home) over 10 years ago
Brian, great illustration of how not only is real estate local - but its hyper-local.  You can be just miles from an area with a completely different story.  
Posted by Steve Scheer, Highlands Ranch Real Estate - Denver Real Estate (Realty Oasis - Metro Brokers) over 10 years ago
Yep, I have to remind people in my community that the national news is not accurate for us. You can do this just like you did with real numbers.
Posted by Ross Quintana, Real E Smarter Real Estate Coach - 509-362-1966 (Real E Smarter) over 10 years ago
MARY:  Yes, Manassas is one of the hardest hit areas.  Thanks for commenting.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) over 10 years ago
JAMES:  Thanks for your comments.  While prices are down in some areas, it certainly is not true across the board.  The freefall predicted in the media just is not true in most of the D.C. area.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) over 10 years ago
STEVE:  Thanks for your comment.  Hyper-local it is.  I can drive 5 minutes in any direction and the real estate market will be different.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) over 10 years ago
ROSS:  Thanks for your comment.  The national news just doesn't cut it when it comes to local real estate decisions.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) over 10 years ago
Brian - I think most areas are finally leveling off or starting to climb a bit!
Posted by Barbara-Jo Roberts Berberi, MA, PSA, TRC - Greater Clearwater Florida Residential Real Estate Professional, Palm Harbor, Dunedin, Clearwater, Safety Harbor (Charles Rutenberg Realty) over 10 years ago

Brian, soft landing?  Hard landing?  In my humble view, if it's a landing that you walk away from, it's a good one!

Posted by Patricia Kennedy, Home in the Capital (RLAH Real Estate) over 10 years ago

Brian:

Some of the stats you quote here are actually WORSE for PW County when you look at NVARs reports for February and look at Detached SFH.  Over the last twelve months, the average sales price is down 29%.

On the flip side, I happen to also have a Detached SFH report for FX County that shows their average sales price has gone down 14%. 

It's all in how you look at the numbers.

Posted by Chris Ann Cleland, Associate Broker, Bristow, VA (Long and Foster REALTORS®, Gainesville, VA) over 10 years ago
BARBARA-JO & BILL:  You might be right.  Not in all areas, but many have plateaued, I believe.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) over 10 years ago
PAT:  I'd have to agree with you there.  Thanks for your comment.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) over 10 years ago
CHRIS:  Thanks for your comments and adding some additional statistics.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) over 10 years ago

Hi Brian,  It amazes me the home you get for the $ in Prince William!  Real Bargains there!

Posted by Eunice Waller, Working Together, We Can Do Great Things (Berkshire Hathaway HomeServices Simpson Realtors) almost 10 years ago

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