Shenandoah Valley, VA 1st Quarter Real Estate Report 2022
The Shenandoah Valley, VA real estate market showed a series of conflicting numbers for the first quarter of 2022. Sales prices were up in all the localities, including Winchester City, Frederick County, Clarke County, Warren County and Shenandoah County, but volume was down in all but Shenandoah County. The area has been plagued by low inventory since August of 2017, and at this time, there is no end in sight.
Shenandoah Valley Average and Median Sales Price
Average sales price is achieved by adding all the sale prices of all the properties sold in an area during a specific period and then dividing that number by the total number of properties sold. For instance, let’s look at a simple example. Let’s say three houses sold. One was $200000, one was $300000, and the last one was $450000. Totaled, they tally up to $950000. The average sales price is $950000 / 3 = $316666.66. The problem with using average sales price is that one high sale can skew the entire view of the market. Median sales price is finding the price in the middle of the highest and lowest sales price. Neither measure is without flaws, therefore, it might be wise to look at both.
The average sales price in the Winchester City market increased from $301000 during the same period in 2021 to
$312000, an increase of 3.65%. Frederick County followed with an increase in average sales price from $338000 to $417000, up 22%. Clarke County had the highest average sales price increase with a 54% increase in the first quarter. The average sales price in Clarke County was $721000, up from $467000 in 2021. The Clarke County average sale price is a great example of how a high sales price on one or a few homes can give a misleading number of overall sales numbers. During the first quarter of 2022, Clarke County had five sales that exceeded $800000, with three exceeding $1000000. In this case, the median sales price would be more representative of the market.
Shenandoah County posted a positive gain of 13.5% in the first quarter of 2022 with a $286000 average sales price compared to the $252000 of 2021. Not to be left out, Warren County posted a 14% increase over 2021 with an average sales price of $369000 over $308000 last year.
Median sales prices followed a similar pattern with Winchester City increasing 11.6% from a 2021 average of $268000 to $299000 in 2022. Frederick County increased 18% from $313000 to $370000. Clarke County had the highest increase in 2022 with 21.4%. The median home sale in 2022 was $493000 as compared to $406000 in 2021. Shenandoah County increased 10% from $236000 t0 $260000 during the same period and Warren County increased 13.6% from $308000 in 2021 to $350000 in 2022. Average and median sales prices have been in a steady increase over the past few years, but other numbers have not been as robust.
Shenandoah Valley Average Sales Volume
Sales volume is a troubling number for the first quarter of 2022. Again, it gives a view into the impact of low inventory. Of the five localities, only one had a positive sales volume increase. Shenandoah County increased 7% over the previous period in 2021. The Shenandoah County volume increased from 156 sales in the first quarter of 2021 to 167 in 2022. Beyond that one positive note, all other localities saw a drop.
The biggest drop in volume sales was Clarke County. Clarke dropped from 66 sales in the first quarter 2021 to 44 this quarter. Granted, that does not seem like a big number drop, but it is a 33% decline. Clarke County was followed by Winchester City which dropped 13.5% from 74 to 64 homes sold. Frederick County was down 8.2% from 342 to 314 and Warren County was off 4% from 172 to 165 homes sold.
Real estate is a volume business. If the volume of homes available does not meet the volume of active buyers, then prices go up and bidding wars prevail. If the volume of available properties falls below a three-month supply, a seller’s market takes over. During a seller’s market, sellers can demand higher prices, fewer contingencies, and quicker closings. It’s in the seller’s market that first-time buyers take the biggest hit. Many come into the home-buying process with a dream, but little cash. A variety of loan programs exist to help these first-time buyers succeed, but in a seller’s market with extraordinarily low inventory, like the current market, makes it a grueling process for the first-time buyer.
Pending Sales and Current Active Listings
Pending sales are a short look back at where the market has been. A home sale closing this week was likely contracted 30-45 days ago. In the current market, even pending sales are down in the localities. All five areas are down from -14% to -23%. Winchester City saw a drop in pending sales of -23% followed by Frederick County at -20%, Clarke at -16.7%, Shenandoah at -14.7% and Warren at -14%. Fewer homes create fewer pending sales.
The Active Listings are in a similar position. Three out of five localities are negative and two are positive. Frederick County is up 3.5% in active listings at the time of this report. Shenandoah County follows close behind at 4.8%. Sadly, it goes downhill from there. Warren County saw a -19.2% drop in active listings. Winchester City followed close behind with -18.6% fewer active listing year to year and Clarke County dropped -9%.
Markets like the current Shenandoah Valley market require extreme patience, maybe a little more compromising and give and take than expected, and a whole lot of faith to prevail. It is brutal at times, but buyers can still win if they come into the market with a clear understanding of what is happening, what challenges they may face and a determination not to let the market beat them down. That can be tough at times, but it can be done. If you are a buyer in the Shenandoah Valley real estate market, gives us a call. We will be glad to be your warrior Realtor.
This post was originally posted at Cornerstonehomesales.com: Shenandoah Valley, VA 1st Quarter Real Estate Report 2022
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