Briggman Marker Watch – Arlington Real Estate January 2021
Single family home boom!
A new market trend is sweeping through Arlington and the surrounding areas – an absolute lack of single family home inventory – the demand for single family homes is HUGE and the prices are soaring. Townhomes are not too far behind. And condos are just hanging in there – nothing crazy is going on in this market. If you look at the demand and supply chart below – you will see that single family home inventory is under 1 month (in red) – which is very very low. We need to be at 2.5 months to be in balance.
I am also hearing rumors of 20-30 offers on single family homes out in Loudoun County – and that is crazy. Just last weekend I put it offers for the same client on 4 different homes in Fairfax Co to just be outbid by 20, 8 and 6 different offers. My client wasn’t just offering the list price, but we didn’t go crazy either (against my advice!). Only going crazy (no inspections, appraisals and very high price escalations) is going to get you a nice house today.
Why is this happening? Why is suburbia having this Renaissance? Why condos are lagging? I think it’s very much pandemic related. Many people are optimistic that working remotely is going to continue – so they aren’t worrying about the traffic and commuting as much. The pandemic also has people searching for more space – apartment and condo living has been brutal for many. Record low interest rates and savings due to lack of entertainment and vacations have people shopping of homes. There were many people who postponed their home search to this year, because 2020 was full of uncertainty. How does this end? I am not sure. Once interest rates go up (not projected this year) the craziness should slow down, but there are A LOT of people wanting to buy a home and we don’t have enough homes – so this isn’t going to go away quickly. It’s probably a trend for the next few years.
Poor Arlington condo market
Why Arlington condos are lagging? Well, city living hasn’t been fun lately – no need for Metro, restaurant experience is limited, communal living and sharing elevators with neighbors during a pandemic is also not so great. I think the biggest thing – due to remote learning at surrounding universities – we had a huge drop in student housing demand. I think condo demand will come back, but we need to hang in there and wait for the life to be back to “normal” or the “new normal”.
Take a look at available homes in Arlington this January vs. the last 2 years. Available condos in Jan 2020 were 64 and in Jan 2021 – 283. That is a 343% increase!!! I know everyone is rushing to buy single family homes or townhomes, but maybe you should be looking at condos.
So dear owners of single family homes – if you are thinking about selling – NOW it’s a very very good time do so. Same goes for townhomes as well. And you, poor buyers, buckle up – it is going to be a wild ride. And I am here to help if you are buying or selling! Contact me here.