october 2009 harrisonburg & rockingham county real estate market report

8/14/2019 October 2009 Harrisonburg & Rockingham County Real Estate Market Report

1/16

October 2009

Harrisonburg & Rockingham County

Real Estate Market Report

and Sco P. Rogers, Associate Broker,

Coldwell Banker Funkhouser Realtors

provided courtesy of

November 9, 2009


2/16

November 9, 2009

1 7/ / 3:1 :3

Perhaps our local real estate market is starng to pick up a bit of steam, or perhaps

were seeing more closings as a result of the $8,000 tax credit and historic low rates.

Either way, despite sales being o 20% this year compared to last year, there wereas many home sales in October 2009 as there were in October 2008. This increase

in sales volume, however, may have been in response to more exible sellers. The

median sales price has fallen 4% year-to-date, and the average sales price has fallen

2.5% year-to-date. Though declines, these are tremendously small shis comparedto most other real estate markets in Virginia and the country as a whole.

Harrisonburg & Rockingham County November 9, 2009

HOME SALES REPORT

# Home Sales 2008 2009 % Change

October --- 62 62 0.00%

Year To Date 824 663 -19.54%

824

663

2008 2009

Median Sales Price 2008 2009 % Change

October $197,000 $184,748 -6.22%

Year To Date $197,900 $190,000 -3.99%

824

663

2008 2009

$198k $189k

Average Sales Price 2008 2009 % Change

October $226,057 $205,617 -9.04%

-

824

663

2008 2009

$198k $189k

2008 2009

$225k $220k

ear o a e , , - .

Average Days on Market 2008 2009 % Change

October 123 163 32.52%

824

663

2008 2009

$198k $189k

2008 2009

$225k $220k

2008 2009

157

190

Year To Date 165 187 13.33%

824

663

2008 2009

$198k $189k

2008 2009

$225k $220k

2008 2009

157

190

2008 2009

A Central Shenandoah Valley Real Estate Update courtesy of Sco P. Rogers, Associate Broker, Coldwell Banker Funkhouser Realtors . Data Source: Harrisonburg-Rockingham MLS.


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November 9, 2009

1 7/ / 3:1 :3

Real estate sales increase and decrease seasonally, and as we head into the winter,

sales typically start to decline. This year was no dierent, with fewer home sales

in October than in November, but since we matched the October 2008 sales pacein October 2009 (despite an overall 20% decline between 2008 and 2009), perhaps

well exceed the November 2008 pace this month. It wouldnt be too much of a

surprise if we did, as the (second of three versions of the) tax credit was set to expire

on November 30th. This tax credit deadline now extends through July 1, 2010, whichmay connue to encourage sales in our local market.

200


Month-By-Month Home Sales History

2005

175

2006

2007

2008

2009

150

ndoSales

100

wnhom

e&Co

75

86

95

77

71

62

75

ingleFamily,T

37

5357

51

25

50Si

0

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC



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November 9, 2009

1 7/ / 3:1 :3

While it is only a small plateau, the long-term (me-adjusted) sales trends showing a

leveling o over the past few months. This happened quite tangibly in October 2009

since there were 62 home sales, the same amount as took place in October 2008.This rolling twelve month sum of home sales shows us the bigger picture of the

momentum of the market. Hopefully we will connue to see stability in this market

indicator as we move through the next six months --- perhaps aided by the rst me

buyer ($8,000) and long term resident ($6,500) tax credits.


Time-Adjusted Home Sales Trends :: All HomesSum of Preceding 12 Months

1,600

1,800

1,200

1,400

1,000

600

800

200

400

0

Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09



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November 9, 2009

1 7/ / 3:1 :3

This graph provides excellent overall insight into the performance of the residenal

real estate market in Harrisonburg and Rockingham County. We see, via the yellow

bars, that the pace of home sales will likely again show a decline when 2009 drawsto a close, though we are not likely to see another 25% decline as we experienced

between 2007 and 2008. The median sales price, shown with the blue line, connues

to stay relavely stable, though with a slight decrease when comparing 2008 and

2009. This decrease is actually a bit larger when considering the changes in thecontext of moderate year to year inaon.


Home Sales & Price TrendsSingle Family Homes & Townhomes

1,507

1,669

95,

100

95,

500

0,

000

250,000

1,600

1,800

+11%

-14%

1,153

1,324

,

1,248

$192,

983

$ $

$19

$200,000

1,200

1,400

+14%

-13%

+15%+14%

+1% + .

829

1,071

936

0 $149,

00

0 $169,

90

$150,000

1,000

-25%

+29%

- +4%

+17%

+14%

663

$116,

000

$122,

900

$122,

588

$127,

70

$100,000

600

800+6%

.

$50,000

200

400

$00

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009



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November 9, 2009

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Single family homes connue to show a moderate decline in median sales price, as

shown by the blue line in this graph. We have now seen an overall decline of 7.8%

between 2006 and 2009 year-to-date. This averages out to an approximate 2.5%decline per year during this me frame. This decline is unfortunate for home owners,

but is quite mild within the context of sales price and value declines seen in most

other parts of Virginia and the naon as a whole. The pace of single family homes

also connues to slow, with only 456 home sales thus far this year, as compared tothe total of 654 sales in 2008.


Home Sales & Price TrendsSingle Family Homes

1,024 1,025 $226,8

00

$223,

57

5

$215,

000

09,

000

$225 000

275,000

1 000

1,200

n/a-11% -1% -4%

868851

880909

798$210,

000

$

$175,000800

+16%

-12%+3%

-2%

+24%

+8%

674654

239

,000

47,

000 $1

70,

000

$125,000600

-18%

+9%

+2%+8%

+16%

456

$122,

850

$133,

$136

$

$75,000400

$25,000200

-$25,0000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009



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November 9, 2009

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Between 2006 and 2008, townhomes in Harrisonburg and Rockingham County

managed to escape the general sales price declines seen in the overall residenal

market. However, it appears that there will be a small downward shi in this medianhome price by the me 2009 comes to a close. Thankfully, however, there has been a

relavely small year-to-year shi in the number of townhomes in 2009 compared to

2008. This is in contrast to the staggering 37% decline in townhome sales between

2007 and 2008. This smaller decrease (in 2009) may be related to the $8,000 taxcredit for rst me home buyers, as many rst me buyers purchase townhomes.


Home Sales & Price Trends

Townhomes

644

$160,

85

0

$163,8

00

$167,

250

$163,

000

$180,000

600

700

+2%+2%

444

483

529

4500

$140,000

,

500

+33%

-18% -15%

+19%

$89,0

00

$94

,600

$103,

10

8,

200

$118,5

00 $

134,

9

$100,000

$120,000

400

+9%

-37%

+47%

+9%

+5%+10%

+14%

203

282

207

$10

$60,000

$80,000

200

300

+49%

+6%

155

$20 000

$40,000

100

+31%

$00

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009



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November 9, 2009

1 7/ / 3:1 :3

While our local market sll has an excess of supply of homes for sale (as shown on

the next page), we do sll see a decline in overall inventory levels when comparing

October 2009 to October 2008. Ulmately, however, we will need to see more ofa decline to return to a closer balance between buyers and sellers. If last years

trend is any indicaon, we should connue to see declines in inventory as we move

through November, December and January -- as many homeowners decide to take

their homes o the market during this me frame. This will mean (perhaps onlymarginally) fewer choices for buyers.

1200


Inventory Levels

932 932

1000

909

866

828

794

838

888904

917 914

866

800

600

400

200

0

Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09



9/16


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November 9, 2009

1 7/ / 3:1 :3

Another measurement of value over me is shown in the median price per square

foot of single family homes sold in Harrisonburg and Rockingham County -- pictured

above. As can be seen, this value has gradually shied down since 2006, as we sawin the median sales price of single family homes during this same me period. This

is not an absolute guide on what to expect to pay for a house in todays market, since

this median value includes new homes, very old homes, homes with and without

basements and garages, and many other variaons of homes that could aect theoversimplied value judgement of price per square foot.


Median Price Per Square Foot TrendsSingle Family Homes

119

$123

$126

$13

0

$13

1

$125

$129

$128

$127

$126

$125

$126

$121

516

$120

17 $

123

$125.00

$150.00

92

0$96

$99

$105

$105

$11

$1

$1 $

1

$100.00

.

$

76

$73

$73

$73

$

76

$77

$7

4 $78

$79

$80

$82

$84

$83 $

86

$87 $

$75.00

$50.00

$25.00

$0.00

2000-Q1 2001-Q1 2002-Q1 2003-Q1 2004-Q1 2005-Q1 2006-Q1 2007-Q1 2008-Q1 2009-Q1



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November 9, 2009

1 7/ / 3:1 :3

Expect to pay a bit more per square foot for smaller homes --- it has been that way

for almost 10 years now. The graph above shows how median price per square foot

varies based on the size of the house in queson. Interesngly, the median price persquare foot of mid-sized and large homes have remained relavely closely paired

over the past nine years, but have separated quite dramacally over the past year.

Price per square foot of the largest homes in our market is now just over $100 per

square foot, while the median price per square foot of mid-sized homes is muchcloser to the overall median value for this metric.


Median Price Per Square Foot by Home SizeSingle Family Homes

$138$140

140

150

0 - 1,499 SF 1,500 - 2,500 SF 2,500+ SF

$123

$133

$128

$123 $123$121

130

$105

$113

$116$122

$119

$115110

120

$84

$89

$93 $94

$92

$106$105

90

100

$77

$71

$74

$77$83

70

80

$68$71 $72

60

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009



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November 9, 2009

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The graph above illustrates the drasc decrease in lot sales that our local market

has experienced over the past several years. With lot sizes smaller than one acre,

most of these lots are in subdivisions, on public water and sewer. The main causefor this drasc decrease is that new construcon has slowed -- most builders are no

longer buying building lots and building houses speculavely. Furthermore, many lot

end users are no longer considering building, because of changing circumstances

with their nances, or because of general economic and market uncertaines. Thedecrease in median lot prices is not surprising, given the large decrease in sales.


Lot Sales & Median Prices

less than 1 acre

408

$99,

900

$100 000

$120,000

400

450

304

$76,

500

$80,000

,

300

350

201

261

247

$54,5

00

$58,

300

$5

9,

500

$60,000

250

165

,000

$30,

500

$32,

208

$36,

900

$42,

000

$40,000150

200

111

8574

40

$2

$20,000

50

100

$00

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009



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November 9, 2009

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Land sales of parcels larger than one acre have not decreased as signicantly as

small lot sales have. We connue to see a decline, but aside from the spike in land

sales in 2005, there has always been quite a bit of variaon in the number of landsales happening in a given year. Of note, however, the median price per acre of the

land that is selling has slipped tremendously over the past two years, from a high

of $24k per acre down to the current level of $15k per acre. This is likely to slip a

bit further if land sales connue to decline, or even if they connue to stay at theircurrent low level.


Land Sales & Median Price Per Acre

1 acre or more

168

$24,

184

$25 000

$30,000

160

180

7,

713

$21,

250

$20,000

,

120

140

87

107

83,

003

$1

$15,

000

$15,

500

$15,000

100

58

76 77

53$8,

245

$8,

333

$9,

535

$1

$10,00060

80

42

33

$8,

234

$5,000

20

40

$00

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009



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November 9, 2009

1 7/ / 3:1 :3

This graph isolates new or almost new single family homes that have sold for each of

the past ten years. We have seen a steady decline in the number of new construcon

single family homes selling since 2005, but of note, the median price per square footof these homes has not shied as much as we might otherwise expect. While this

metric includes houses with signicant variaon in their characteriscs (basement,

garage, lot size), this price per square foot metric can likely be a helpful rule of thumb

in discussing price per square foot or building costs with a builder.



New Construction Single Family Home Sales TrendsNumber of Sales, Median Price Per Square Foot

186

200180

200

138 137140

158

139$144

$136

150140

160

89

121

109

14

$133

$15

$146

100

120

70

$87 $

94 $

99

$105 $

1 100

60

80

5040

00

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


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November 9, 2009

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Most homes that sell (64%) are selling (and closing) within six months of coming

onto the market. This, of course, does not factor in the many (many) homes that

languish on the market and do not sell -- leading to a higher average days on marketstasc. Given that it typically takes 45 - 60 days to move from a raed contract to

the closing table, it is quite remarkable that a full 32% of home sales in the past six

months have taken place within 3 months of the date when those properes came

on the market. This means that they were under contract within the rst 30 or 45days of being listed, which is likely a surprising gure for many hopeful sellers.


Days on Market Analysis

' - '

< 2 years

4

1%

0 - 3 months

1 - 2 years

54

12%

150

32%

9 - 12 months

43

9%

6 - 9 months

64

14%

3 - 6 months

150

32%

Average Days On Market: 186



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November 9, 2009

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The me that it takes to sell a home in todays market varies quite signicantly based

on the price range of the home in queson. For example, a full 38% of homes that

sold for less than $200,000 sold in the rst 90 days of being on the market, whileonly 10% of homes between $300,000 and $400,000 were able to sell in that same

me period. On the other end of the spectrum, only 9% of homes that sold for less

than $200,000 took more than a year to sell, but a full 27% of homes priced over

$400,000 took over a year to sell. The average days on market for homes over $400k(234 days) is 43% higher than that of homes under $200,000 (164 days).


Days on Market Analysis by Price RangeMay 2009 - October 2009

32% 32% 14% 9% 12%All Homes

0 -3 Months 3 - 6 Months 6 - 9 Months 9 - 12 Months 1 - 2 Years 2+ Years

38% 32% 11% 10% 9%Under $200k

Avg = 186

27% 32% 19% 7% 14% 2%$200k - $300k

Avg = 164

10% 43% 19% 14% 14%$300k - $400k

Avg = 205

36% 23% 5% 14% 23%400k and u

Avg = 219

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Avg = 234


october 2009 harrisonburg & rockingham county real estate market report

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