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Residential Market Update

By Greg L | 12 December 2008 | Local Economy | 21 Comments

Our local residential real estate market started a remarkable turnaround starting last June that is still going strong.  The chart at left shows the change in the supply of houses on the market in Prince William County, Manassas and Manassas Park starting in May which has steadily declined through December 1st.  The number of houses for sale now is approximately the same number that was available in March of 2006, and at this rate will arrive at back pre-bust inventory levels in about six more months.

The number of homes that are available and not under contract has been dropping by an average of 9% these past six months, and this will soon contribute to a stabilization and recovery of residential prices as the huge advantage that buyers now have in the market evaporates.  The problem over the past several years has been too few buyers chasing too many properties and foreclosures have only exacerbated the problem.

In May, there were 6,172 residential properties on the market without a contract in the Prince William area. As of December 11th, there are 3,503.  That’s a more rapid change to stabilize the market than the run which destabilized it over the past few years.

Local governments are bracing for further weakness in the residential market, which makes sense even if the cause for such doom-and-gloom seems to be  dissapating.  After several years of tough budgets, the last thing they want is to end up with a potential deficit again, and they’ve been cutting spending as hard and strong as they can.  When the next round of residential assessments is complete, if the balance of buyers and sellers in the market has returned to reasonable balance, property values should at least level off, and most likely will start climbing again.  That lag means that local governments will be the last to benefit from the turnaround.

As much as we like to dump on investors, they’re a big reason why this turnaround has been happening, especially in the lower-priced properties where the market slide has been most pronounced.  While a decreased home ownership rate introduces additional challenges, and the potential for another round of residential overcrowding problems, market stabilization is what will be needed to restore confidence to potential homeowners and increase their participation in the market.  By next summer we should see if this trend holds out, and if it does a lot of local residents, as well as local governments will be breathing a lot easier.



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21 Comments

  1. Harry said on 13 Dec 2008 at 9:10 am:
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    This is really great news, with speculators buying up foreclosures and renting them out, great news for homeowners who live in their homes. LOL.

  2. Citizen12 said on 13 Dec 2008 at 2:01 pm:
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    From what I have seen and heard the buy up has shown little change in the new occupancy from what we had a year ago. Within a couple weeks of the “first level occupancy” we get the arrival of more people and many cars with a variety of state tags.

    It makes one wonder if the “low doc-no doc” is still in full swing.

  3. Anonymous said on 13 Dec 2008 at 3:22 pm:
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    Another Georgetown South but on a grander scale?

  4. Benton said on 13 Dec 2008 at 10:04 pm:
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    That would be PG County. Here we go….!!!!!!

  5. Mighty Putty said on 13 Dec 2008 at 10:05 pm:
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    This is a great time for Rick Bentley (aka Bothparties….) to get out of his mom’s basement and into a nice used townhome or condo. And don’t worry, Pizza Hut will deliver to your new address. Of course, you’ll have to start making your own chocolate milk. Don’t worry Rick, I’ll send you the recipe.

  6. Tyler Durden said on 15 Dec 2008 at 9:08 am:
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    MP - you left your gas on.

  7. AWCheney said on 15 Dec 2008 at 12:32 pm:
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    I must ask…Mighty Putty, why are you and everyone else being so really nasty to Rick Bentley? Also, what makes you believe he’s BothParties because, if he is, he sounds perfectly reasonable to me.

  8. Chuckie said on 15 Dec 2008 at 1:19 pm:
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    I really like Rick Bentley’s posts on the hirsute harpies’ blog.

  9. FormerCityofManassasResident said on 15 Dec 2008 at 1:24 pm:
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    Also think Rick Bentley is doing a great job on the other blog - keep telling them the truth even if they don’t want to hear it. And tell that Rob Pearson guy to hold his vigil someplace else than in PWC!

  10. DPortM said on 15 Dec 2008 at 3:56 pm:
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    AWC, Both Parties is Rick Bentley, and Mighty Putty seems to have an intense dislike for Rick. I appreciate Rick and his postings, and I appreciate Robb Pearson’s postings as well.

    Just as an FYI - Rick does not live in his mother’s basement - he has a home of his own - and he is a quite likeable fellow. We may not always agree - but I value his input.

  11. john said on 15 Dec 2008 at 4:55 pm:
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    The vigil will happen.

    HERE!

  12. Emma said on 15 Dec 2008 at 5:03 pm:
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    They keep Robb Pearson around to prove to the rest of us that they’re really not all THAT homophobic, they just like a gay joke or two every once in a while.

  13. Emma said on 15 Dec 2008 at 5:12 pm:
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    They keep Pearson around to prove to the rest of us that they’re really not all THAT homophobic, they just like a gay joke or two every once in a while.

  14. DPortM said on 15 Dec 2008 at 5:23 pm:
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    Scratch my comment about Robb Pearson - I was thinking about Rob Smalls that posts here.

  15. Ricardo Juarez said on 15 Dec 2008 at 5:45 pm:
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    You gringos can make noise. We have vigil here.

  16. FormerCityofManassasResident said on 15 Dec 2008 at 6:03 pm:
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    Pearson needs to stay home and not get involved in PWC. He never lived next to a flophouse full of people who came and went at all hours of the night making huge amounts of noise and committing crimes locally in the neighborhood (breaking and entering houses). He acts like he thinks he can tell us how to run our local government. He’s over there lecturing everyone on how PWC is worse than any other local government as far as laws it has enacted. What does he know? He and the women can stand together - all 4 of them, and hold their vigil and no one will care.

  17. Emma said on 15 Dec 2008 at 9:19 pm:
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    Pearson’s gotten completely dissed on the other screen. The armchair activists started whining about how it’s Christmas, and what with people traveling and all, it’s too hard to get up enough anger for a vigil. All but one think it’s a pointless exercise. That guy is in serious need of a hobby.

  18. chicko said on 16 Dec 2008 at 9:03 am:
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    Agreed,

    I’m not a big follower of bothparties but I do agree with some things he says. I really enjoy him bashing the harpries over on the other blog, fine entertainment for sure.

  19. Mighty Putty said on 16 Dec 2008 at 11:35 am:
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    AWCheney said on 15 Dec 2008 at 12:32 pm: Flag comment
    “I must ask…Mighty Putty, why are you and everyone else being so really nasty to Rick Bentley? Also, what makes you believe he’s BothParties because, if he is, he sounds perfectly reasonable to me.”

    I know he is Rick because a few months ago he was going on a diatribe about McCain, Catholics, and God and Christianity in general. He was getting some heat so he changed his name to NaughtiusMaxiumus, then to BothParties….

    I am a man of my word. If Rick does decide to move out of the basement, then I’ll send him the recipe for chocolate milk. I’m happy to send it to any of you that would like it.

  20. AWCheney said on 19 Dec 2008 at 2:51 pm:
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    Well Mighty Putty, as diatribes go, including those that I have seen from you on this blog, I can’t see where his are any worse than the others. Just because he voices an opinion which differs from yours is no reason to continually deride him, or anyone else…unless they are themselves getting rude and personally insulting.

  21. AWCheney said on 19 Dec 2008 at 2:56 pm:
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    By the way, sorry it took me so long to respond. I haven’t been following the threads very closely lately…been a little busy.

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