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Prince William Real Estate Market Jumps Again
By Greg L | 12 May 2008 | Local Economy | 16 Comments
April’s residential real estate statistics are out for April, and Prince William County area remains the market hotspot in Northern Virginia. While in Northern Virginia as a whole sales are down almost 11% over April of 2007, in Prince William sales continue to climb. That seems to be happening particularly in some of the areas that were previously impacted the most by foreclosures, according to MRIS data:
| Location | Sales Change April 07-08 | Pipeline / Sales |
|---|---|---|
| Manassas 20109 | 112% | 170% |
| Manassas 20111 | 174% | 144% |
| Woodbridge 22191 | 90% | 188% |
| Woodbridge 22193 | 122% | 168% |
The middle column here represents the percentage increase in sales from April 2008 over April of 2007. The right-hand column represents the number of current contracts and contingent contracts that are active compared to the number of sales in April of 2008. This “pipeline” represents a portion of the potential sales that may close in May. While prices continue to decline in Prince William (something happening throughout Northern Virginia), the sales activity continues to outpace the region.
Over in Fairfax County, the picture isn’t quite so bright. While some places like Herndon are seeing a recovery (in 20170 sales are up 37% for the same period), others are continuing their decline in year-over-year sales. For example, zip codes noted as being areas where significant price reductions have occured in the recent past (the same selection criteria used for selecting zip codes in Prince William and Herndon), sales are down 61% in Falls Church (22042), and Reston (20191 is down 12% and 20190 is down 47%).
Of note, Herndon and Prince William share one common and unique trait in Northern Virginia. They are the two jurisdictions that have taken local action to decrease the number of illegal aliens unlawfully residing in the community. Although other factors undoubtedly are playing a role here, the recovery of the quality of life in these communities may well be making them more attractive to homebuyers and is helping drive this sales activity.
This makes three consecutive months of improving residential sales activity in Prince William. While the sales volume is still relatively low, anecdotal data for the current month suggests that housing inventory is being rapidly absorbed. The potential here for a decrease in market supply and increasing sales transactions is going to soon start showing up in prices, and as soon as prices start to climb again, the residential real estate market recovery in Prince William County will become official.
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16 Comments
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One other thing PWC and Herdon have in common is cheap housing.
What we don’t need is a bunch of investors in here buying up the spoils of war. If that happens, it is a guarantee that we will go right back to where we were if not worse. Irongate and Georgetown South are perfect examples of investor owned properties. Translation: out of sight, out of mind.
I would have to see a lot more variables before anyone makes a believer out of me, after driving around and seeing what I see.
Just think, if the large number of Latinos who “bought” at the height of the bubble and then got foreclosed on had waited two years………….
Do you have the average home price data for the same time period? That would be interesting to see if the prices have stabilized.
Average sale price in the four zip codes in Prince William are down 30% over the same period the year before, but be careful when interpreting this. If lower-priced houses are selling rather than higher-prices houses, that would reduce this statistic, and to some degree this may have been the case. This statistic doesn’t necessarily mean that the average price of a home declined 30%, it means that the average price of the homes that were sold was 30% less than the average price of homes sold in 2007.
There is continued price depreciation however, which is demonstrated that homes sold for on average of 87% of their asking price in April 2008, where in 2007 they were selling for an average of 94% of the asking price. That’s about as close to apples-to-apples as you can get with this data.
As the available inventory declines, which seems to be the case, prices should stabilize and start slowly going back up.
There are apparently a lot of auctions going on right now for homes in Manassas and PWC.
And how many houses have sold at a foreclosure auction? Darn few if any.
Why? Waaayyyy too expensive.
Greg:
Are sales really up 112%, 174%, and 122%? I mean, are they really more than double what they were last year (up 100% would mean they’ve doubled) or are they up a few percentage points from last year? is the 90% in 22191 really a 90% *increase* or were sales 90% of what they were in 2007?
For example, last year 100 homes sold in April and this year 150 homes sold, sales are up 50% (150-100= 50 which is 50% of the original 100) or are 150% of last years’ sales (they are not, however, up 150%). For sales to be up 150%, 250 homes would need to be sold this year versus 100 last year.
Would it be possible to for you to provide the raw numbers as well? Percentage can be fickle things. For example, if last year only 1 home sold in a given a ZIP code, 3 homes selling this year would be a whopping 200% increase in sales over last year, but in reality isn’t much of a big deal. Without the raw numbers, it’s really not very meaningful.
Yep, these are the real percentage increases. The raw numbers are:
20109: from 33 to 70 sold
20111: from 23 to 63 sold
22193: from 63 to 140 sold
22191: from 49 to 93 sold
The consistency here is pretty surprising. According to “Greater Northern Virginia Housing Bubble Fallout”, these are the zip codes which have seen the most significant price discounts in the county, and from my experience (I live in one of these zip codes) the most significant previous problems with residential overcrowding.
It’s actually getting harder to find the vacant, previously overcrowded bank-owned foreclosures that I like to take reporters on neighborhood tours to see. The last time I was walking a reporter around the neighborhood looking at these, someone walked up to us and asked what we were doing in the back yard of the house he recently bought. The place had been utterly trashed, and all the appliances stripped (including the furnace) when the folks living there had skedaddled in the middle of the night, and I couldn’t imagine anyone buying the place. But folks are seeing the deals to be had, grabbing these up, and renovating them.
It is good that the houses are selling but the result to the existing home owner may not be what they want. The price the houses are being bought at determins the value of your existing home. One major problem with that is if the person you just mentioned examined the house that had been trashed before making an offer and offered what it was as a major fix it up then your home will go down even futher in value. The assesors only look at the recorded price being paid and do not know the condition of the house being bought. It will be some time if not a couple of years before new homes bought 5-=6 years ago get back to the value of what people paid for them back then. One other effect will be more children in schools and that will result in an increase in taxes if the school system if funded. As long as PWC has the cheapest houses to buy it will sell more but how many more houses were forclosed on as compared to other counties and cities in N VA?
We’ve had 3 sales on my street, old side of the park, our street ends at the new police station, to give an idea of location.
1 was an original owner sale, basic original house in very good shape, 125k, but needing total updating.
The second was a foreclosure. Bought by a single guy that plans to live in it for 3-5 years then either sell or rent out. He and his friends have purchase several in here with those plans. His was actually in very good shape. Said all it needs is paint and maybe carpet. Paid 150k for it. This one was valued by the city at 300k.
Third house not sure of the status but 90% sure it was a foreclosure. It was purchased by the gentleman that built the new strip mall by the police station. I have spoken with him and he said he is looking to pick up several more as investments. He mentioned he hopes to rent them to those same people that rent the stores out from him. Kinda like a mini company town.
We still have four foreclosures left on this street, in varying conditions. Will be interesting to see what they end up going for.
Also an interesting bit of info is the 2 houses on Cabbel that butt up to the police station are city owned. Will be interesting to see what if anything the City will do with them.
And God save the culture from adolescent attempts at scatological sarcasm.
The investor interest in houses concerns me. However, I would rather see the units purchased and fixed up for resale/rental as opposed to being abandoned and left to rot. In a perfect world, the homes would be bought by married couples with 2.5 kids. However, the fact is that many of these homes are not going to be purchased by this type of family, due to age, condition, etc.
I’ll probably anger some of you by saying this, but I think that the best thing that could happen to some of our neighborhoods in the Manassas/Manassas Park area is redevelopment. We’ll never compete with the Piedmont and Dominion Valley properties to our west if all we can offer are 50-year old three bedroom/one bath homes. The location in Manassas is great, but many of the houses just are not attractive anymore. The reason illegals were able to get these homes was white flight out of these older smaller homes to larger ones out west.
Thanks for the raw numbers and clarification. Now if we could just make a dent in the foreclosure rate.
Most of the foreclosures around me have sold and have families in them. Unfortunately the ones just like mine sold for $120K less than my city assessed value.