If you’re looking to buy real estate this year, you’ll want to study the market outlook for future months. For instance, if you want to buy soon, now’s the time to look at the spring real estate market. After all, you can’t predict what the market will do if you just look at today’s status. So, if you plan on buying rental properties this year, read along as we go over Northern Virginia’s spring housing market outlook.
Contents of This Article:
- Spring Real Estate Market Outlook for Northern Virginia
- What Buying Trends Have Changed Over the Years?
- Is Now a Good Time for Investors to Buy Real Estate?
- Hire Property Management for Your Investment
Spring Real Estate Market Outlook for Northern Virginia
Whether you’re looking at investing in real estate or a property management company in Northern Virginia, it’s important to stay up to date with market trends. While looking at the spring real estate market outlook, some Northern Virginia investors are cautiously optimistic.
According to the latest confidence survey of the Virginia Realtors’ trade group members, market activity is slow now, but many focus on the spring market. Here’s what 632 respondents had to say about the upcoming real estate market in early January 2023:
Survey Predictions and Statistics
- Current buyer activity is low but slowly rising over the past few months.
- 7% of the survey respondents rated buying activity as “high” or “very high” in their community, while 59% said the activity of buyers was “low” or “very low.”
- First-time real estate buyers made up 28% of all the reported transactions, up 24% from the previous month.
- All-cash sales went from 28% to 22%, suggesting that more primary-residence buyers are gaining strength in the market.
- Sellers received 1.3 offers on average before accepting one, down from 1.5 from the previous month. However, this is still well below the average of more than six offers in the spring of 2022.
- Around 26% of all sale contracts showed a selling price above the original listing price, down 28% from the previous month.
- Buyers seem to be waiting out the market, as the seller-activity index went from 20 to 17 over the month of December.
- Upon looking at the spring real estate market, the projected buyer and seller activity should improve but remains much lower than last spring.
- 14% of respondents think spring market prices will be higher, while 55% said they’d be lower, and 29% said they’d remain the same.
While these aren’t necessarily scientific statistics but predictions for the future market, it’s important to note what other investors have to say. Even with high-interest rates and affordability concerns for Northern Virginia investors, there’s hope for the spring real estate market.
Next, let’s dive into some real estate buying trends that have changed over the years, making the buying process different for investors.
What Market Trends Have Changed Over the Years?
The real estate market has changed significantly from just five years ago. The Covid-19 pandemic changed how most things operate, including buying real estate. As a result, everything from home prices to interest rates and how we buy properties drastically differs from years prior. Some of the leading market trends in Northern Virginia over the past five years include the following:
- Median Sale Price- The median sale for real estate in January 2023 is $525,355, compared to $395,611 in January 2018.
- The number of Homes Sold- The number of homes sold in January 2023 is 1,811, much lower than five years ago. In 2018, the number of homes sold was around 2,430.
- Homes for Sale- In January 2023, the number of homes for sale in Northern Virginia totaled 5,673, compared to 10,064 in January 2018.
- New Listings- New listings fluctuate depending on the season. However, the number of new listings in January 2023 was 2,262, compared to 3,646 in January 2018.
- Average Days on the Market (DOM)- Looking at the average number of days a home has been listed for sale, numbers from 2023 and 2018 are more similar than other statistics. In January 2013, the average DOM was 27.41, while in January 2018, the average was 28.92.
Is Now a Good Time for Investors to Buy Real Estate?
As we transition from winter to spring, many investors are scoping out potential investment opportunities. But is now the best time to buy real estate?
Most investors know that mortgage interest rates and real estate prices have skyrocketed over the past year, leaving many investors worried about the future. However, that doesn’t necessarily mean buying real estate is impossible. Here are a few market trends to watch for this year that may affect buying real estate.
- Supply and Demand May Balance Out- Home inventory is still quite low but growing with more active listings on the market compared to 2022. This may indicate the possibility of more home sales in 2023.
- Home Values and Mortgage Rates- Although they may fluctuate, home prices are growing rapidly compared to previous years. However, luckily, the speed of home price growth is starting to slow. Additionally, mortgage interest rates are at an all-time high but will likely slowly decrease throughout 2023 and 2024.
- A Market Crash Is Unlikely- Although it’s hard to predict for sure, most real estate experts believe a market crash in 2023 is unlikely. In fact, the National Association of Realtors indicates that rates will peak in 2023 but eventually go down. In turn, this brings the demand for homes up.
With all this in mind, it’s important for investors to watch the market closely. If you’re looking to buy real estate this year, now’s a good time. No matter what’s happening in the market, real estate is always valuable and increasingly more valuable over time.
Hire Property Management for Your Investment
If you’re considering buying a rental property in the next couple of months, it’s crucial to thoroughly evaluate the spring real estate market. Then, once you know where to look and when to buy, you’ll want to figure out how to manage your rentals. Luckily, Professional Property Management in Northern Virginia can help you with all things property management.
Whether you need help marketing properties, drafting lease agreements, performing maintenance, or collecting rent, we cover it all. Contact PPM to learn more about our services and how we can help your rental property business today.
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