Harrisonburg Real Estate Market Report - March, 2014

Click here to download Market Update charts for March 2014.




As we wrap up the first quarter of 2014, we find ourselves facing a residential real estate market somewhat lagging when compared to last year’s numbers. Through the first three months of this year, 157 residential properties have sold in Harrisonburg and Rockingham County, as reported by the Harrisonburg-Rockingham Association of Realtors Multiple Listing Service. These 157 sales are 13.3% fewer than last year’s first quarter sales of 181 properties. So what’s going on? What happened to that recovery?

Fear not, I believe the recovery is real…it has just been temporarily delayed by a harsh (for our area) winter, and a shortage of saleable inventory. Contracts placed on homes for sale totaled 91 in March – a 38% increase from the average of the prior three months. Further, we have seen extremely high traffic on our website, www.KlineMay.com , which tells us Buyers are actively looking.

The inventory problem is real, however. For the past several years the seasonal pattern of lower inventory in the winter and higher inventory in the summer has persisted – as a pattern. The pattern, however, has repeated with lower numbers each year (see our Harrisonburg and Rockingham County Inventory charts). Fortunately inventory has increased in the County for the past couple of months, although it is still low. In Harrisonburg the low inventory issues persist, with slightly decreasing numbers in March. If this problem is not corrected it will lead to an acceleration in the increase in home prices as Buyers bid properties up in a competition for the limited supply.

Prices have remained fairly flat for the past several months, with the 12 month average currently at $198,139 and the 12 month median sales price at $175,225. The one and three year trends are:

Three year change:    Average Price down -2.79%, Median Price down -2.16%
One year change:       Average Price up +2.05%, Median Price up 0.13%

The inventory issue is really quite interesting. We would normally expect lots of folks to be putting their homes on the market this time of year. While we have seen an increase in new listings, and we expect to see many more in April, the inventory of saleable homes - homes which are priced properly and present well, is not enough to meet the demand from Buyers in all but the most expensive price ranges. Why is this? Possibly because homeowners are waiting for prices to go up a little more. Possibly (and more likely, in my opinion) many homeowners refinanced at incredibly low rates and have decided to stay where they are for a while longer and enjoy their low monthly payment while home values recover. It will be very interesting to see how homeowners behave this Spring and Summer. If we can predict our market based upon markets in larger cities (which is often an accurate predictor), we should look for increasing prices this summer as Buyers compete intensely for the best deals on the market.

Click here to view or download our Market Activity Charts for March 2014.

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