At Labor Day, we saw solid evidence that the housing market was in recovery mode. Summer market statistics showed a diminishing backlog of homes in foreclosure, increases in sale prices, and continuing record-low mortgage rates. Here in Northern Virginia, the market news is still good as we head into the autumn and winter months.
Nationwide the rate of housing starts rocketed to a four-year high during September up 15% from August – the best it’s been since the summer of 2008 before the downturn stopped nearly all building and lending in its tracks. Housing starts are important because they are an indicator of how much confidence builders, banks, and buyers all have in the housing market.
The summer trend in low mortgage rates continues on with rates still hovering near record lows. In addition, the Federal Reserve announced recently that it would buy $40 billion in mortgages every month. This will help keep mortgage interest rates low for the foreseeable future, and keep the market momentum going.
The rate of foreclosure continues to drop, and is currently at a five-year low. This means there are fewer distressed properties available on the market. Having the building industry in a holding pattern for the past few years also helped to cut the supply of new homes on the market, and together these two factors help keep the levels of supply and demand more in balance. In turn, this helps to boost sale prices and provide yet more incentive to start building again. It’s a win-win-win situation.
The recent drop in unemployment is also good news. This, coupled with low mortgage rates and an increase in the number of affordable homes, means that more Americans are able to seriously consider home ownership again. Anika Khan, senior economist with Wells Fargo Securities, sees this as an overall improvement trend in the market rather than simply a one-month bump.
These economic indicators point to now being an excellent time to get into the real estate market in Northern Virginia. Reasonable prices, high-quality homes, and low mortgage rates combine to create the perfect opportunity. All of us here at The Sullivan Group are ready to help you find the ideal property. Call our office today at 703-222-3300 or contact me directly by email or by phone at 703-268-6380.
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