We will open the book. Its pages are blank. We are going to put words on them ourselves. The book is called Opportunity and its first chapter is New Year’s Day.
That is a quote from Edith Lovejoy Pierce, a poet who obviously produced inspiration. We find ourselves in a New Year, full of possibilities, and are certainly excited about the year ahead. Opportunity awaits us!
Before we move ahead, though, lets look back at what happened in our local real estate market throughout 2012.
Sales for the individual month of December weren’t that great. This is no surprise as the holidays are always a busy time for just about everybody. However, looking at the big picture, Harrisonburg and Rockingham County saw a 9.2% increase in sales over last year! Plus, home values remained steady to finish out the year, with average price per square foot at $100.64 for 2012.
Taking a look at full-year stats, we can see that the average price per square foot (or home value) has fallen every year since 2007. The good news here is that it appears to be plateauing, and perhaps we’ll see an increase building up to next year at this time. You can also see (by the yellow line) that homes are about 200 square feet larger now than they were 5 years ago, which does play a role in determining a home’s value.
Looking toward the future, we see that December increased yet again in contracts, which means buyers are still committing to buy properties in Harrisonburg and Rockingham County, and most of those contracts will turn into sales. Beginning 2013 off with a solid sales number would set a strong pace for sales throughout the year. For all of 2012, there were 942 contracts written for residential properties, which is a 9.2% increase over 2011. (Did anyone else notice that this is the exact same amount of increase as sales?)
The fact that contracts have continued to strengthen as the months pass by is a very positive indicator in our local real estate market’s health and stability. December of 2012 was the strongest December in terms of contracts over the past four years. This was the 7th time during 2012 that we saw an increase in contracts!
Above, you can see how contracts versus sales have fared over the past year. Remember, it is very good when that “contracts” line stays above those “sold” bars because it means the coming months will be even stronger than they are now.
Finally, we see that supply and demand plays a factor in the real estate market. The more homes that are available for sale on the local market, the more buyers have to choose from. The more options buyers have, the less demand for homes there is. We’ve experienced some pretty high inventory over the past few years, hence the buyer’s market. However, inventory is dropping and sales are increasing, which will bring more balance to our local market. We’d like to see a healthy balance in supply and demand so that buyers still have choices, but also so that sellers can get the most out of their investments.
Over all, we’re content with how the Harrisonburg market fared over 2012. We are encouraged by the positive stats supporting this community that we love so much, and are looking forward to what 2013 holds for our team. We’ve got some exciting news and events brewing, so stay tuned for more… right here on Harrisonblog!