If you own or plan on purchasing a home in Northern Virginia, this may give you some insight into the local real estate market.
COVID-19 impact on the real estate market is apparent in this week’s Northern Virginia Real Estate market update. All of the leading indicators point to a slow down in the market.
- New Listing numbers are down.
- Pending home sales are down.
- Withdrawn listings are up.
The number of new listings in Week 13 of 2020, when compared to the same week in 2019, is down 7.6%. That means fewer homeowners are listing their homes on the market.
There also appears to be fewer buyers in the market as we saw a 21.6% drop in the number of pending listings year over year.
The last number, which we saw the most significant change in, is withdrawn listings. A listing is withdrawn when a homeowner decides to remove their home from the real estate market without selling it.
In Week 13 of 2019 there was only one withdrawn listing. This year there were 93 withdrawn listings in the same week.
That’s quite a big difference!
What does all this mean?
Well, there’s some uncertainty in the market, and that is evident by the changes we are seeing in the local real estate market.
For starters, this a very transient area, with many people moving in and out of the region each year. During this time of year, we typically see a lot of military moves.
Military personnel would have received their orders, and some of them that are homeowners would have listed their homes for sale. Likewise, we get an influx of military buyers during this time of year. As of this moment, PCS orders are on hold.
Is that the only reason for the changes?
No, and we’ll need to keep an eye on the market in the coming months to see what the final effect will be.
But as unemployment numbers continue to grow, we expect that to have an impact on other would-be homebuyers.
There have also been changes to the loan requirements for FHA loans. The minimum credit score required has increased, which reduces the buyer pool. We see evidence of that in the reduced number of pending transactions.
With fewer listings coming on the market and more being withdrawn that means there’s less competition for sellers that are interested in selling right now. Conversely, there’s also less competition for buyers as lending guidelines are restricted. We’ll keep our eyes on the market to see what effects this ultimately has.
What does the data tell you about the market? Post your thoughts and takeaways in the comment section. If you’re thinking about buying or selling and need guidance give me a call at 703-539-2053 or email me to set up a consultation.
The Northern Virginia region consists of the following counties: Alexandria City, Arlington, Fairfax City, Fairfax, Falls Church City, Prine William, Manassa City, Manassas Park City, and Loudoun.
Data Source: Bright MLS
Statistics calculated on April 2, 2020