Sales Market Summary Q3 2014: The very strong market we saw this past Spring and Summer slowed–just a bit–for July-September. There were a total of 61 sales in this period (13 condos, 6THs, 42 detached). Interestingly there was a much larger # of detached sales this quarter vs. 27 in Q2 2014. For most of the period, the number of active listings (all types) on any given day was between 35-40–a few more than the previous quarter. Total sales for the past quarter was higher than Q3 2013 (51 sales; 14 Condos, 8 THs, 29 Detached). As of mid-October, there were 35 Active listings (all types) which continues the volume we’ve seen for most of this year.
Distressed Sales: Surprisingly there was one sale in this category–a foreclosure condo at The Madison that closed in mid-September. The good news is that it did not linger (Under Contract in 7 days) and sold at list price of $206K–a whopping 33% above the 2014 tax assessment. You can bet the assessment for that until will change in 2015 and possibly for the whole building). It’s safe to say this was an anomaly, and while possible, it’s unlikely we’ll see another distressed sale anytime soon.
Note: Below #s are averaged; TAV = Tax Assessed Value
*13 Sold (5 fewer than Q2 2014)
*Days on Market: 7…..much faster than Q2 2014
*Sold Price: $321,338, a quite large 17% above TAV
*Seller Subsidy: 46% had a Seller Subsidy with an average of $1,485
*Price Difference (Sold vs. List): A negative $669
*6 Sold (2 more than Q2 2014)
*Days on Market: 18……Like Q2, a quick turnover
*Sold Price: $716,167, 7% above TAV (lower than Q2’s 14% above TAV)
*Seller Subsidy: 17% had a seller subsidy; $667 (very low, almost a non-issue)
*Price Difference (Sold vs. List): A negative $2,617
*42 Sold (15 more than Q2 2014, a large increase)
*Days on Market: 34-48…..Like Q2, this was on the long side due to 6 overpriced listings. Excluding them, 22 days was the average
*Sold Price: $949,581, a healthy 13% above TAV
*Seller Subsidy: 36% had SS; $3,140
*Price Difference (List vs. Sold): A negative $11,864, which is quite high
Rental Market Summary Q3 2014: While the rental market remains tight, there were quite a few more rentals in this quarter vs. Q2–especially for detached houses (just like Solds).
*47 rentals (17 condos, 6 THs, 24 detached), a large increase over Q2 2014
*Days on Market: 20 Condo; 23 TH, 21 Detached
*Rented Price (Range): Condo: $1390-2700; TH: $2995-4000; Detached: $2250-4850
As of mid-October, there were 19 Active rentals (12 condos, 2 THs, 5 detached). As always, there are 5 condo in Roosevelt Towers that are essentially permanent rentals (i.e. they’ve been in MLS for years). By removing them, you’re left with 14 active rentals, which interestingly is the exact number at the end of Q2 2014. So the tight rental market remains unchanged. .
NOTE: Not all rentals are in MLS. Some are done privately or more often on-line (Craig’s List, Military by Owner, etc.) so the numbers here don’t show everything. However we’re confident they capture the overall trend.
Overall: We still have a tight market, as was seen in strong condo and TH sales. As noted above, there was a large spike in the number of detached sales. That increase is not a bad thing, just unusual compared to the past few years of July-Sept. The only bad aspect (albeit minor) was there were 6 listings clearly overpriced that took way too long to sell. Also, several detached sales did not jive with their 2014 tax assessments (TA), as some 13-14 houses sold either way above or below their TAs. The ones that sold above will likely have their assessments raised next year.
Yet the most noticeable–and important–phenomenon was the number of new construction sales for the quarter (8 by our count) compared to only a few for January-June and even fewer in all of 2012-2013. New construction has been quite strong in Falls Church and the surrounding areas (N. Arlington, McLean). In Falls Church, this was due in large part to the end of allowable new construction on sub-standard lots. Thus there was the predictable rush to get these houses built. However it’s worth noting not all new construction, to include “major” renovation, has been on sub-standard lots. The tax collection-minded folks love this trend while affordable housing proponents clearly do not.
Low interest rates, a strong local economy, our location and schools are what drive this market and give people the confidence to do major renovations or new construction. This trend will likely continue for the foreseeable future. The big question is, when do interest rates go up enough and/or the number of buyers able to afford (expense and aggravation) of new construction/major renovation drop? That’s a hard question to answer. What’s not in doubt is the large supply of older homes (cape cods, ramblers) that are prime candidates for demolishing.