Investing in comfort
Home buying in 2014 had a strong finish in Shenandoah and Warren counties and is off to a good start in 2015, according to some area real estate agents.
Statistics from Metro Regional Information Systems, a home sales database, show Shenandoah County saw 44 homes sold in December, with total sales of $8.55 million. In numbers of homes sold, this was a 20.45 percent increase from November and no increase over December 2013. In total sales, it amounted to a 13.4 percent increase over November and a 10.38 percent increase over December 2013 sales.
In Warren County, 38 homes were sold, amounting to $7.27 million dollars. In numbers of homes sold, this was a 19.14 percent decrease from November and a 5 percent decrease from December 2013. In total sales, this was a 26.74 decrease from November and a 32 percent decrease from December 2013.
Michael Beasley, lead agent for ERA Real Estate in Woodstock, said the December figures are a little misleading.
“Overall, December is a quiet month, but you may have had closings that occurred in December from September, October, November, that’s when there’s traffic,” Beasley said.
Overall, 2014 was a volatile year, Beasley said.
“It’s been mixed over the past year,” Beasley said. “We had a strong spring, but other times were sort of highs and lows and housing inventories seemed a little less, to me.”
However, 2015 has started out great, Beasley said.
“January has started out really gangbusters,” Beasley said. “We got quite a few contracts going, showings and even some listings coming in.”
Beasley said lower interest rates and the lower costs of fuel are contributing factors for an increase in sales in 2015.
“I think we’re going to start to see more strengthening in home buying because of a potential drop in interest rates, as well as the cost of commuting becoming lower,” Beasley said.
Beth Waller, lead agent for Team Waller Realty in Front Royal, said despite the slump in December sales, 2014 was a “turning point” in the Warren County real estate market.
“I am very encouraged because the numbers I have ran, distressed sales, like foreclosures or short sales, were down 33 percent in 2014, which is setting the stage for a continued recovery in 2015,” Waller said.
Waller said the mindset of home buyers changed in the years after the recession, especially in 2014.
“Home buyers are not seeing competition from investors, because most of the people in the market for a home are not looking for an investment, but looking to live the American dream by owning a home where they can raise their family,” Waller said.
Waller said 2015 has gotten off to a great start.
“The phone has been ringing off the hook for people looking to list their homes or to buy a home,” Waller said. “One of my associates said to me last week, ‘Can you believe this is January’? I haven’t seen this much business this time of the year in a long time.”
Like Beasley, Waller said lower interest rates and the drop in fuel prices are huge factors in home buying.
“Most of my career, I have sold homes to people who moved from the northern Virginia area to find a cheaper cost of living, so the gas drop makes it easier for them to make that decision,” Waller said.
Waller added, “With the interest rates so low, it’s getting a lot of people who were on the fence about buying to make the decision to buy, especially with the talks about the interest rates possibly going up by the end of the year.”
Edgar Olsen, a professor of economics at the University of Virginia, said home buying is a great way to measure the health of a local economy and is driven by a range of factors.
“When the economy is good people will more often get a house on their own and when things are bad, people will share with others, like a roommate situation,” Olsen said. “The economy has slowly been getting better and we’re starting to see the effects of that.”
Olsen said there is a correlation between gas price drops and people buying single-family homes, as well as lower interest rates on loans.
“If gas prices are low, when it’s cheaper to make that commute, you’re more likely to have people move into single-family homes, just as a drop in interest rates will get people to buy as well,” Olsen said.
Here are some other figures on the housing market performance in December:
• In Warren County, the average sold price for a two bedroom detached house was $137,938, a three bedroom $192,129 and a four bedroom $280,586.
• In Shenandoah County, the average sold price for a two bedroom detached house was $136,507, a three bedroom $176,517 and a four bedroom $277,492.
Contact staff writer Henry Culvyhouse at 540-465-5137 ext. 184, or firstname.lastname@example.org