Northern Virginia's March 2011 housing sales were down 14% YoY, and median prices were up .2%. The average days on the market increased by 33% to 69 days.
(The above statistics include Alexandria City, Arlington County, Fairfax City, Fairfax County, Falls Church City, Fauquier County, Loudoun County, Manassas City, Manassas Park City, and Prince William County).
As I was updating this month's data, I noticed that MRIS had extensively revised its data back to about 2005. Prior to 2005, they still use their old charts, which haven't changed. I'm including two side-by-side spreadsheets -- the one on the left is the data as it now exists at the MRIS site, and the one on the right is the data as I recorded it last year from MRIS. Small changes have been noticeable since they revised their website a few months ago, but this month they were so extensive that I felt I had to show both. I can't explain it nor do I have access to any source material -- I just use what's at MRIS.
Obviously, there was something wrong with the old data, but I didn't notice at the time. Fairfax County, for example, showed 5,278 active listings at MRIS last year, but Virginia MLS showed about 2,600 on March 15th. This year, last year's active listings for Fairfax was corrected to show 2,918.
I sometimes provide inventory statistics from Virginia MLS here, so we were better off trusting those for inventory than MRIS, it seems.
Here's a link to the spreadsheet since it's not possible to see it all here.
Monday, April 11, 2011
Northern Virginia March Housing Sales
Posted by Harriet at 4:08 PM
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22 comments:
Thanks, Harriet, for going the extra mile to get these data to us.
It looks like they just changed their methodology from counting all listings, to only counting active listings. If this is the case I assume that the numbers from the early 2000s should have also changed, but perhaps they didn't have the data anymore.
Any other guesses on why the numbers changed so dramatically?
Perhaps everyone already knows this but I didn't.
S&P's definition of a "double dip" is a drop below the 2009 level (or the lowest level during the Great Recession). Despite what many econmists are stating, S&P spox for CS does not see it happening.
They predict a stagnant price situation for a few years. Does anyone else here think the big story is over?
VA_I,
I think the big story is over. Normally housing price pullbacks follow recessions or depressions. It makes sense when you think about it. First the economy faulters, then people lose jobs, then savings are tapped, then mortgages get behind, then foreclosures and downward pricing pressures happen. Don't forget though that by the time people start falling behind on their mortgages or getting foreclosed on, the general economy is probably picking up steam again and coming out of the recession.
2005-2007 was a unique experience in that an over leveraged banking industry fueled a credit pop and people were falling behind on mortgages while still gainfully employed. Housing lead into the recession rather than a consequence of the recession.
What we're experiencing right now is the typical recessionary pullback or sideways movement following a weak economy. I'm of the opinion that in 2 years we'll be looking back and see that 2009-2011 were clearly a bottom/extended sideways move.
My $0.02
I don't know how the big story can be over given we are just beginning government cuts, lending is a lot harder, a populace which has historically rented is going back to renting, and the overall economy is still weak.
I don't think the big story is over. Some bad stuff will happen in the next couple of years that will be a result of the policy measures taken during the Great Recession.
I think in 2015, we'll look back at the period of 2011-2014, and say, "oh, yeah, of course that happened, because of the enormous government borrowing, and the ultra-easy Fed policies."
I'm not saying what will happen. All I believe is that we won't have strong, non-inflationary growth like we had in the 90's.
VA-
Are you talking about the DC area or for the nation as a whole? I could agree it is unlikely that DC will go below 2009 levels, but the the 20 city index will almost certainly have a new post bubble low. The index is only ~1.1% of its post bubble low and it has been falling ~1%/month. I will be very surprised if it doesn't hit a new low either this month or next.
Date Composite-20
January 2009 146.34
February 2009 143.11
March 2009 140.06
April 2009 139.26
May 2009 139.98
June 2009 141.97
July 2009 144.32
August 2009 146.11
September 2009 146.63
October 2009 146.49
November 2009 146.17
December 2009 145.89
January 2010 145.31
February 2010 144.06
March 2010 143.34
April 2010 144.57
May 2010 146.47
June 2010 147.99
July 2010 148.89
August 2010 148.49
September 2010 147.26
October 2010 145.23
November 2010 143.75
December 2010 142.34
January 2011 140.86
I don't expect prices to go more than 5-10% below the 09 lows, but I think breaching the lows is very likely.
hb,
I guess I am talking nationally. The news cycle regarding housing is getting stale. People are used to it and it's just another problem that has retreated from the current big issue of the day.
As far as the 90's, i recall a fairly dead 7 or 8 yrs pricewise. I don't know if Robert refers to housing or the economy. In my memory neither was doing much.
My guess for the local housing picture hasn't changed. Although this was/is far worse than the 90's, I still believe in my 2006 forecast - years of flat prices followed by another cycle up. Same old, same old.
What will cause a future increase? Inflation? Supply/demand? A loosening of credit (short memories)? Increased rents? Local economic factors? All of the above?
I'm doing what I did in the 90's; buckle the seat belt and hang on. Clearly, I believe the worst is over but I have no crystal ball.
VA-
I agree with your forecast. I think housing will likely keep relatively flat nominal prices for several years and then a cycle up after they become cheap on a real basis.
Just to be clear, I predicted prices falling 25-40% regionally with the exurbs and condo's being hit the hardest.
I thought high turn-over and low-end would suffer the most. This definitely hit the the outlying areas because everything that changed hands was new construction at peak with "fog the mirror" financing. Other hard hit areas were low end where buyers were easily sold down the road by their fellow countrymen. I don't mean to sound racist, but many were swayed by the thought of riches and loan officers put whatever it took on the application to get a loan approved.
The "it's moving in" sentiment failed to account for these factors.
Seeing people line up to buy condo's to flip was another interesting clue. It was almost a ponzi scheme. Glad I wasn't the last one off the train. I knew it would end badly and convinced more than one (investor) to bail on their deposit. I remember saying to one guy that had 4 condo's under contract to walk on 100K in deposits or lose 800K if they bought.
I'm no savant, but I've been around the block.
"Contrarian said...
The worst is still ahead (DC area & nationally). Buckle up!
4/12/11 1:59 PM"
Contrarian -- I dont expect you to answer, but this is a serious question if you are up to it.
Youve been saying this or something like it for as long as this blog has been around:
Summer 06 as prices were stagnating -- the worst is yet ahead!!!
Fall 07 as prices really started to roll over -- the worst is yet ahead!!!
Early 2008 as prices were plunging at breakneck speed -- the worst is yet ahead!!!
Late 2008 as price drops started to ease -- the worst is yet ahead!!!
Early 2009 as prices started to bottom -- the worst is yet ahead!!!
Mid 2009 as prices started to move up -- the worst is yet ahead!!!
Early 2010 as prices continued to move up about 5% above the bottom -- the worst is yet ahead!!!
Early 2011 as prices continue to move up about 10% above the bottom -- the worst is yet ahead!!!
How long do you continue to remain resolute in your predictions (i.e. prices dropping 90%)?
If in 2012, if prices are 15% above bottom will it still be -- the worst is yet ahead!!!
What about 2016, if prices are 25% above bottom, will it still be -- the worst is yet ahead!!!
The year 2024? No? Perhaps the year 2034 then??? Prices up 50%? No? Perhaps up 100% then??? When, if ever, do you conclude perhaps the worst is BEHIND us?
Again, I dont expect you to answer, but it would be nice if you would. I think that for 99% of us there is a timelimit and or pricelimit wherein we do decide that perhaps the worst is behind us. I just want to see where or if at all you fit into that 99% category.
$.02
"Don't forget though that by the time people start falling behind on their mortgages or getting foreclosed on, the general economy is probably picking up steam again and coming out of the recession."
Well, what are we seeing now?
Unemployment is still high nationally.
The Feds aren't hiring much locally.
Gas Prices are within 30 cents or 7% of the 08 Peak.
we have a split economy.
Wall Street is roaring along fine.
Main Street is really staggering.
The Feds spent $2 trillion and moved unemployment less then a point.
Gas prices
Pat,
You just proved my point. The economy just added 200k jobs last month and the unemployment rate is down 1 full percentage point since November. Sure we aren't completely recovered yet but the cycle has turned towards getting better rather than getting worse.
As VA_I was saying, everyone knows about the bad press, and rising gas prices. It's baked into expectations on main street as well as wall street. In my opinion, it won't have the same consumer enthusiasm dampening effect. So things will continue to slowly improve.
Sure there could be set backs but that's always the case. I think right now we're on the upswing.
My $0.02
Anon
Your commentary is kind of dickish.
If you slice up the markets like VA_I does the story is much more mixed.
PW, FQ, LO certainly followed the bathtub curve. Same with PG. I'm now posting 40-50% off losses in the parts of DC i'm following.
Now, has ARL, AX, NW DC done well, the numbers certainly argue for that. However it's much more a castle built of sand IMHO.
24% of all Mortgages in the DC MSA are underwater. That's a long way down, and, while certainly some people feel obliged to fight to the last dollar, as many more will walk.
I posted an article today about People in PW, who bought in the 90's and are in trouble because of real estate collapse and job loss.
Now Will ARL,AX, NW rise in Perpetuity? Seems kind of implausible to me.
Cheryl thinks we face a long stagnation, which is probably right.
I would prefer a fast decline and retur to growth, but, Bernanke, Paulson et al didn't want that.
Let's see what happens.
Pat,
In Anon's defense, her commentary has always been a bit dickish.
Just kidding.
Seriously though, Contrarian doesn't engage in honest discourse. It's always "the end of the world is nigh." I for one find it impressive that Anon has the perseverance to continue to call out Contrarian.
My $0.02
"Pat said...PW, FQ, LO certainly followed the bathtub curve. Same with PG. I'm now posting 40-50% off losses in the parts of DC i'm following."
So what? While you and I may think that was enough of a decline, Contrarian still thinks "the worst is yet to come" because they didnt go down the predetermined 90% that he decided was just a matter of time. Imagine he was looking to buy in that market? Think that waiting for 90% off nominal prices before buying is going to end up well for him?
___________________________________
Pat said...Now, has ARL, AX, NW DC done well, the numbers certainly argue for that. However it's much more a castle built of sand IMHO."
Which part makes you believe that? Is it the highest income increases in the country, or (for parts of the area) the biggest demographic shifts in 50+ years?
Its funny, my guess is you think Contrarian is delusional for thinking "the worst is yet to come" for PWC, yet that is precisely what you do for the so called immunozones.
Over the years, you have likely made 50 or so statements about the future of the immunozones, and every time you have underestimated their strength. Thus your record is 0-50. You would think after going 0-10 or maybe 0-20, you would say, gee maybe its not a castle built on sand like I think. Despite this, you remain resolute, convinced that (despite the 2 years of slowly rising prices) its still just a matter of time.
___________________________________
So anyway, back to the question. How long is it going to be and or how high are prices going to rise before he calls it quits?
In your case, I asked you this a few years ago, and you said (in sum) if it hasnt crashed by 2012, it aint gonna crash.
At the time, that probably seemed like a safe bet on a timeframe that was a long long away. However, with 2012 getting closer on the horizon, are you going to stick to it, or are you going to pull a Contrarian and push your capitulation date further into the future as that date gets closer and closer to reality?
Oh, and BTW, I dont blame you for going 0-50 on your calls for the immunozone. I was probably 0-200 by the time I "got it" and realized I was wrong. Just consider how much better off I would have been if I set a hard and fast "I was wrong" date/price at the beginning.
Consider, this is my predictions vs prices at the time for the past 8 years:
2003 -- 460K "this is too high prices must come down"
2004 -- 550K "this is WAY too high, prices are gonna crash"
2005 -- 660K "this is absurd, prices are coming down a good 40%"
2006 -- 800K "mark my words, blood in the streets"
2007 -- 760K "SEE, I TOLD YOU SO,
2002 prices here we come!!!"
2008 -- 720K "uh oh... prices arent comin down nearly as much as I expected."
2009 -- 710K "oh shit, this is NOT looking good for me"
2010 -- 720K "my god, what have I done by waiting"
2011 -- 730K "I was wrong"
So here we are. I am now 8 years older, and have paid close to 200K in rent and Im gonna pay 270K more than I would have in 2003. Imagine how my life would have been if back in 2003 I said "if it goes up another year or 20% more I will buy"???
Dont get me wrong. In your case, there is no rush to buy, especially as your rent is so cheap and prices arent going up anywhere close to the 20% a year they were back in my day. Still, like all of us, you are here because one day you too want to buy. Thus, at some point, you will have to decide how may years of your life you are willing to spend pining away for what you want and presumably can afford.
.02
"the unemployment rate is down 1 full percentage point "
That's not because they are hiring, it's because a million people gave up looking for work.
25% of young people and 20% of men over 50 have not worked in 2 years.
I agree and you have a point there. Very interesting concept. And thanks for sharing the update.
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