Fredericksburg Area Housing Analysis 2011 05Posted: June 10, 2011
2011’s Home Sales Still Outpacing Low Point in 2008
(Fredericksburg,VA) – With the artificial demand stimulated by the First Time Buyer’s Credit last year, 2011 sales volume in the Fredericksburg area wasn’t expected to outperform 2010. As predicted, total sales so far this year were 5 percent behind the first five months of 2010. Somewhat surprising though may be that 2011 is also 6 percent slower than in the same period in 2009. The recession hit the area hardest at this time of year in 2008 when total sales through May only amounted to 1,383 units. At 1,588 units so far in 2011, the Fredericksburg region is currently outpacing dismal 2008 figures by 15 percent.
May sales volume totaled 361 units, up from 354 in April but down from the May 2010 total of 382 units. Sales have failed to reach corresponding monthly totals in 2010 in all but one month this year. Stafford led the area with 149 sold units while King George posted the lowest total at 17 units.
According to Loudoun-based real estate consultant Rosemary deButts, “Given the cyclical nature of the housing industry, sales at this time of year should be spiking. To match 2010 year-to-date records, sales volume in June 2011 needs to be 617 units. That is unlikely since the highest monthly sales volume in recent years was 549 units in June 2006. However, if it could be done, 553 sales in June would match 2007 levels.”
The median sales price increased 1 percent in May to $196,000 from the revised $193,935 median in April. At this time last year, the median sales price was $217,500 (-10 percent). The median advanced on a month-over-month
basis everywhere but Caroline where it landed at $112,000, a value that was also 23 percent behind the May 2010 median. Stafford posted the highest median at $232,380 followed by King George County at $227,000. The year-to-date
median in the Fredericksburg region was $189,900 as of May 31st. That is the lowest annual median in at least five years, 39 percent behind the 2007 median and 10 percent behind the 2010
After peaking at 99 days in April, the average days on market indicator receded to 95 days in May. The 2011 average was 90 days; compare that to 76 in 2010, 97 in 2009 and 130 in 2008. King George had the highest average at 197
days in May. The lowest average was in the city of Fredericksburg with 87 days. Of the 361 sales in May, 137 units (38 percent) actually sold in 30 days or less but 8 units (2 percent) took at least a year to sell.
The close price to original list price ratio was 91.4 percent in May across the region. That was an uptick from April’s 90.8 percent but a drop from last May’s 92.9 percent. Behaving like sales volume, this ratio has not reached or exceeded the corresponding value in 2010 in four of the last five months.
Roughly 87 percent of the sales (313 units) in the Fredericksburg area were detached homes with an average close price of $230,990. Stafford posted the highest average price for detached homes at $279,699; the lowest average close price was in Caroline ($123,151). Attached homes accounted for 12 percent of sales volume (12 units) with an average close price of $137,658. Three condominiums sold in Stafford last month at an average price of $72,467.
The share of distressed sales (short sales and foreclosures) declined for the third consecutive month in the area. After four months with a share greater than 50 percent of total sales, May’s 43.5 percent was the second consecutive month below 50 percent. Caroline was the only county with a share of distressed sales at or above 50 percent. Only 22 percent of the sales in the city of Fredericksburg were distressed in May.
Typically, a market is considered to be in equilibrium (enough supply to satisfy demand) when there is a four to five month’s supply of inventory. The available inventory declined for the fourth straight month in the Fredericksburg area to 4.6 months from 4.7 in April. In January the supply totaled 6.9 months’ worth. The lowest available inventory, 3.5 months, was in Stafford suggesting it may be slightly undersupplied. The highest inventory was in King George, 8.9 months.
Rosemary deButts further commented, “Since half the year is spent with sluggish sales volume, it is unlikely that 2011 will catch 2009 and 2010 sales volume but the market is in better shape than it was in 2008 .” ###