The new year began the same way it went out: with so little supply of homes for the raging demand from homebuyers that even houses in the top price points saw multiple offers, a relatively rare occurrence in the in the last 10 years. January closed out with a total sold dollar volume of approximately $184.5 million which represents a staggering 50% increase over January of 2020. The market saw a significant 13% year-over-year increase in median price, going from $305,000 in January of 2020 to $345,000 in January of 2021. Units sold increased over 26%, finishing out the month at 486 compared to 385 units sold last January.
FAAR Board of Director Dawn Josemans comments, “As we keep doing business with our new virtual tools and following CDC guidelines when we physically show homes, we are not seeing the market slow down. We are still seeing more buyers than there is inventory to support, so buyers are not getting the first house they put an offer on. Maybe not even the second or third home they put on offer on. As a result, we are seeing multiple offers quite a bit over list price within days of going on the market. Many sellers are accepting those offers, waiving previous customary contingencies and keeping their fingers crossed for an on-the-money appraisal.”
While Stafford County has frequently driven gains in regional numbers, that was not necessarily the case for this January. While the County’s median price clocked in at $400,000 once again, representing a more than 14% increase from last January, units sold remained flat. There were 154 homes sold in pre-pandemic January in Stafford County, and 159 homes sold in January of 2021. At first blush, this might appear to indicate that demand is cooling in the County but a closer look at the numbers reveals that is not the case. A nearly unfathomably low inventory is responsible for depressing sales in Stafford County. In January of 2020, a time when most agents would agree that the supply was very low, there were 404 available homes on the market. Fast forward to the end of January 2021, and there were just 80 homes on the market, representing a whopping 80% decrease.
The jurisdictions with smaller populations saw the largest gains in January with Colonial Beach, Orange County, King George County, and the City of Fredericksburg posting 100% or more increases in total sold dollar volume, with Caroline County not far behind at 75%. The acceleration in sold volume was driven by a combination of higher price points and many more units sold, sometimes even 100% increases from the previous year. If January is any indication of how the market is going to be in 2021, area homebuyers and sellers are in for a wild ride.
Days on market, the time it takes from when a listing enters the market until it receives a ratified contract and is removed from active status on the multiple listing service, fell nearly 60% with houses averaging a measly 20 days on the market this January compared to 48 days last year.
Not unexpectedly, inventory across the region remains at historic lows. In January of 2020, there were 1,149 homes on the market. In January of 2021, there were just 396 homes for sale, representing a nearly 66% year-over-year decline. New listings were down more than 10% compared to last year, but that number seems moderate compared to some of the decreases the market has seen over the past year. New pendings continue their upward trajectory with a nearly 15% increase in pending contract activity compared to last year.
The past year has also seen a very heated and competitive rental market, altered in many ways by the eviction moratorium and accelerating demand. Josemans, whose real estate specialty is property management, comments, “The rental market remains strong; however, it is an interesting and complicated portion of the market. There are tenants whose income has been affected by COVID receiving Federal protection from being evicted. There are landlords being protected by the State with avenues to seek mortgage and rent income relief. The question is how long are both of these protections going to last. What happens when the protections go away? What happens to the folks who did not receive relief? Market conditions have led to a great deal of landlords deciding to take advantage of the current sales market and sell their investment property.”