Of course, that’s what you’d expect a realtor to say, but Todd has plenty of data to back up her optimistic predictions. Speaking at the monthly luncheon of the Annandale Chamber of Commerce Thursday, Todd said house prices have hit bottom and are starting to rise, so buyers can find good value. And the low inventory of homes on the market, means houses will start selling faster.
Nationally, sales of existing homes are projected to rise about 8 percent in 2011 and another 4 percent in 2012.
There have been some upsides to the downturn, Todd says: People are paying off their credit card debt. It’s become harder to qualify for loans, and “lenders are under the microscope,” so they’ve ended some questionable practices. And “new housing will be smaller, greener, and more affordable.”
The dominance of the mcmansion may be over, she says, although people still want high-quality touches, like granite counters and media rooms.
The real estate market is dependent on employment rates. For every 1,000 houses sold, about 500 jobs are added, Todd says. Every home purchase pumps $60,000 into the economy. If people feel they have job security, they will be more likely to buy a home, she says, noting, “in this area, people are feeling more confident about the economy.”
The Washington metropolitan region added more jobs to the economy between February 2010 and February 2011 than any other region in the United States. And within this region, Northern Virginia is doing better in terms of economic growth than D.C. or the Maryland suburbs. That’s because the tax structure in Virginia is more business friendly, which has helped to attract major companies like Northrop Grumman.
Fairfax County had an unemployment rate of 4.4 percent in January 2011, compared to 10.1 percent in D.C. and a national rate of 9.8 percent. The sector that lost the most jobs in the region is construction, but that is improving along with the housing market.
Nationally, sales of existing homes have hit the bottom and are improving, but new home sales are still slow, Todd says.
In the area covered by NVAR—Fairfax County, Arlington, and Alexandria—“the demand is there for new houses,” and construction is starting to pick up, Todd says.
The average price of a home sold in that area was $448,957 in March 2011, which is up about 3.4 percent from March 2010. The median price of a home sold in March 2011 is $385,000, an increase of about 4.6 percent from a year ago.
There were 3,975 active listings in this area in March 2011, which is about 6.9 percent fewer than March 2011. The number of new listings last month, 2,864, is down 11.2 percent.
For Annandale (zip code 22003), the average price of a home sold in March 2011, $360,661, is down 1.26 percent from March 2010. The median price in Annandale last month, $375,000, is up 1.35 percent from a year ago.
Fifty-one homes were sold here in March 2011, compared to 54 last March. The average days on market last month, 56, is up nearly 48 percent from March 2011. There were only 91 new listings in Annandale last month, compared to 108 in March 2010.
Construction is still slow because it’s difficult to get loans, but that is changing, Todd says. And while foreclosures and short sales are still a large part of home sales in other parts of the country, they make up small percentage of sales in Fairfax County.
Those who bought property for a quick resale were the ones most burned by the housing slump. If you buy a house to keep and live in, “you’ll do very well long term,” Todd says.
Annandale realtor Pat Sawhney of RE/MAX agrees there is pent-up demand. “If people believe prices are going up, they will put their homes on the market,” she says.
Debi Pyne of Pyne Studios, a design/build and remodeling company, says some people are reluctant to renovate because they worry their home could be ripe for a tear down.
Todd responded that people prefer new construction—until they figure out how much farther out they have to go to find something they can afford. When they factor in the commute to work, they often choose older houses closer in.
When asked about the prospects for commercial property in Annandale, Todd said this community “looks like a hodgepodge of stuff.” Once Annandale is spruced up, it will attract more development, she says.