The local housing market started the year out with a bang, racking up year-over-year increases in units sold and total dollar volume for the first time in nearly two years. January closed with approximately $153 million in total sales volume, an almost 8% increase since last January. Sold volume was fueled by a nearly 7% year-over-year increase in units sold, coming in at 324 homes sold this January compared to 303 last year. This is the first time the market has seen an annual increase in units sold since April of 2022. Median price increased a modest 3% coming in at $432,000 this January compared to $419,900 last year.
“Our region is still experiencing limited inventory, and the tension between low buyer demand and even lower seller activity is keeping upward pressure on home prices,” comments FAAR Board of Director Meghan Kala. “Median home prices in every locale continue to rise and our fringe areas are no exception. Buyers should look at these year-over-year prices as an indication that ‘the bubble isn’t going to burst’.”
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 stayed nearly static from last year, going from 38 days last January to 39 days this year. Nearly a third of homes on the market sold in 10 days or less.
Active listings, new listings, and new pending transactions were all down in January with just 634 homes on the market at the close of the month, the lowest since February of 2022. New pending sales were down more than 17% with 383 homes under contract compared to 464 last January. New listings stayed static from last year continuing the trend of diminishing new product coming onto the market. The region saw 476 homes listed last January compared to 467 this year, a nearly 2% decline.
Sellers continue to sit on the sidelines to see what mortgage interest rates are going to do. Kala comments, “As growth and development in the Fredericksburg region continues, the parallel that has consistently remained the same is the immediate need for homes. Sellers could be sitting on a mountain of equity and are ready to downsize, but they are uncertain if the time is right to list. The question they may ask themselves is – where will I go? As a result, we may see an increase of home sale contingencies in transactions. We are still experiencing multiple offer scenarios, which should encourage sellers who are getting ready to put their home on the market. Many buyers have been enjoying the security of contingencies in the slower market, but those days may be numbered if rates decline. Attainability, especially for first time home buyers, could prove to be challenging if they continue to wait.”