I typically answer it by telling them how the Northern VA market is not only one of the fasted in the country to recover from the bubble burst of 2007/08. We have buyers out looking and sellers are beginning to put homes on the market again. Still though, the inventory is down which drives prices slightly higher due to increased competition.
According to RGS Title in the last issue of NVAR magazine, the monthly average sold price in the whole Northern Virginia area in May of this year was $450,000 while in the same month of 2009, it was around $420,000….so we are seeing some slight appreciation year over year (about 7% which is healthy).
If you look back at the trend over the past 50 or so years, the price of a given home nearly doubled every 10 years…well, in 2000, the average home price in this area was 250,000 and in 2010, it is $450,000…pretty close to double. I would say if we looked at a specific home in (say) Alexandria Virginia and it’s value/price in 2000 vs. its price now, it is probably almost exactly double.
So you see, if you look at it in terms of what the market should be doing and not what inflation did to the market between 2004 and 2008 vs. now, home prices are exactly where they should be. Even the Washington Post said in its real estate section something to this effect.
Naturally, in the summer months, activity slows a bit, so the momentum will slow through June, July and August (so don’t be alarmed it home sales drop a bit over the next couple of months) but have no fear we are moving along at a good pace right now. Stability is a good thing…and our market is finally experiencing it!