Winchester-Frederick County, VA Mid-Year Real Estate Report – 2017

Winchester-Frederick County, VA Mid-Year Real Estate Report – 2017

The Winchester-Frederick County, VA mid-year real estate market continues to shine. Some numbers are up and some are down, but they’re all good. That is welcome news for buyers, sellers and homeowners in general. The total number of sales in the Winchester-Frederick County, VA mid-year real estate market was 840 compared to 806 in 2016. That is not a major change, but it is a number heading in the right direction. It is consistent with the national average of 6% appreciation.

The one number that is the most impressive is the average sale price. The 2017 mid-Winchester-Frederick County, VA Mid-Year Real Estate Report - 2017year sales price average was $265,500 while 2016 was $255,034. The same period in 2015 was $242,578. That’s a nice consistent progression over the past three years, but the big change is when you look back five years. In 2012, the average sales price for the first six months of 2012 was $209,049. That is a 21% increase over five years. That’s impressive.

Winchester-Frederick County, VA Mid-Year Real Estate: Down Numbers

Another number that is down in the Winchester-Frederick County, VA mid-year report is the days on the market. The days on the market has remained fairly consistent over the past 5 years. The days on the market in 2012 was 87, 85 in 2015, 81 in 2016, but 2017 was down to 63 days. That is a 22% drop between 2016 and 2017. The good news for sellers is that their homes sit on the market fewer days and the sale price is higher.

Another stunning number that is also down is the percentage of distressed properties (short sales and foreclosures). The Winchester-Frederick County, VA distressed property average for the first six months of 2017 was 6%. Foreclosures made up 4.4% and short sales added 1.6%. Here again, historical comparisons show how far the market has come since the recession. The percentage of distressed properties in 2012 was 39%. In 2012, 14% of mid-year sales were short sales and 25% were foreclosures. A 33% improvement is seen in the increase in home prices from 2012 to 2017. The fewer distressed properties on the market means that home values are stable and selling at true market value.

With low-interest rates and a moderate number of homes on the Winchester-Frederick County, VA real estate market, sellers have the upper hand. That can be fragile because a run up in available properties could reverse that benefit in favor of buyers overnight. It happened in July of 2014. But, for now, sellers are in charge of the local real estate market.

When you’re ready to buy or sell in the Winchester-Frederick County, VA real estate market, give the local real estate pros at Cornerstone Business Group, Inc., a call. Let’s talk and make something great happen.

Winchester Distressed Properties Are No Longer Distressing

Winchester Distressed Properties Are No Longer Distressing

The good news for the Winchester-Frederick County, VA real estate market just keeps rolling in. It’s safe to say that Winchester distressed properties are no longer distressing most home-owners. What is a distressed property? A distressed property can be a short sale or a foreclosure (or REO, real estate owned).

Winchester Distressed Properties Are No Longer DistressingA short sale is a property the lender gives the home-owner permission to sell below the current loan balance. Many homeowners who bought in the pre-recession years, bought their homes at a premium price. For instance, a home that sold for $400,000 in 2006 lost value during the recession, and owners who carried those mortgages found themselves in trouble in 2008 and beyond.

Winchester distressed properties: What are they?

The Winchester real estate market lost an average of 33% in the fall of 2008, and soon after, Winchester distressed properties shot up. That $400,000 home was now worth $280,000 – $300,000. That left the home-owner with a debt of up to $100,000 beyond his home’s value which was no longer backed by his real estate. That scenario is where the often used real estate term, “under-water” originated. In that case, the owner was drowning in his mortgage debt because he owned more than the home was worth.

Distressed properties came in waves. The first wave of distressed properties came by way of foreclosure. Many families who were dependent on two incomes were reduced to one income as the economy and the real estate values contracted. They were followed by investors who over-extended themselves, and finally, those owners who were hanging on by their fingernails lost their battle in 2009 through 2013. That opened the door to a wave of short sales.

All Winchester-Frederick County distressed properties have declined over the past three years, but the most recent news is the best. Of the current pending sales (homes under contract), only 8.7% are distressed properties. This is a place where an interesting phenomena has taken place. Up until this year, foreclosures have always been the primary source of distressed properties, but in June of 2017, short sales are leading that group of Winchester distressed properties at 6.2% of that total. Foreclosures make up the rest at 2.5%. That number is likely to return to higher foreclosures as short sales continue to fall, but both categories are on the decline.

Winchester distressed properties: By the numbers

There are 289 pending sales in the Winchester-Frederick County, VA real estate market. Of those, there are 15 short sales and 7 foreclosures. If you know how the numbers unfold, you can decide whether this is a time to panic or is it the natural progression of a market on the move.

Of the 15 short sales that are pending, 77% (13) were homes purchased before 2008. Winchester Distressed Properties Are No Longer DistressingBecause of the inflated home values before the recession, those properties would be prime candidates for an under-water mortgage. The highest number of short sales also corresponds to highest home sale prices immediately before the recession (2007). The remaining 13% of Winchester distressed properties (2) were purchased after the recession began.

The reason there so many short sales pending in June 2017 is because of the way short sales progress. Before a home-owner can qualify to do a short sale, she must communicate with her bank that she can no longer afford her home and she needs to do something. The home-owner has a few options. None are very good, but she can allow the home to be foreclosed, or offer a deed in lieu of foreclosure or she can begin a short sale.

Winchester distressed properties: How short sales work

A short sale is only possible if the bank agrees to allow the home-owner to sell the property below the loan balance. When the bank agrees, the home is listed and buyers can make offers. Once a buyer makes an offer, the seller can accept the offer, but that does not mean that the property will ever go to closing. The bank also has to agree to the offer. This is where the third part approval is needed a second time in the sale. It’s also traditional real estate sale practices and timelines disappear.

A bank may take 3 months to 6 months to 18 months to accept the buyer’s offer. Even though the seller has already said, “Yes,” to the buyer’s offer, the bank has to sign off on it. Of the pending short sales, 6 of those properties were listed in 2016. Only 9 were listed this year (2017). Some of those short sales have been under contract for months waiting for “third-party approval.”

The bank will hire local real estate agents to assess the property to make sure the list price is a fair price, and they will compare the buyer offer to that assessment. If there is a large gap, they bank will likely turn it down, and that can come after 90 days, or more, of waiting. A short sale is not a good property for someone who has to move quickly. Once the bank has accepted the buyer’s offer, then the process of a traditional sale begins. Home inspections are scheduled, earnest money deposits are deposited, title searches are conducted and the process begins to move toward closing.

Winchester Distressed Properties Are No Longer DistressingThere are 15 short sales pending in June 2017, but they are more likely a sign that the market is doing a little housekeeping after the recession. If the balance of the homes under short sale contracts had been purchased in 2013 and beyond, I would be concerned. Since they are pre-recession purchases, they’re showing that real estate prices were over-inflated, buyers were over extended and the market was in deep need of a correction.

Another reason not to panic over the June 2017 numbers is that there are 535 active listings on the Winchester-Frederick County, VA real estate market. Of that number, only 3.8% are distressed properties. That’s a negligible number compared to where the market has been in the past decade. Only .01% of those distressed properties are short sales. The Winchester distressed properties are no longer distressing home-owners, and that’s good news for everyone in the Winchester-Frederick County, VA real estate market.

 

 

 

Sell your home with Cornerstone Business Group, Inc., and we’ll offer a home warranty to sweeten the deal.

Sell your home with Cornerstone Business Group, Inc., and we’ll offer a home warranty to sweeten the deal.

Sell your home with Cornerstone Business Group, Inc., and Sell your home with Cornerstone Business Group, Inc., and we'll provide a home warranty to sweeten the deal.we’ll offer a home warranty to sweeten the deal. A home warranty gives the buyer confidence that if anything happens in the first year of ownership, they’re covered. They can extend the warranty after the first year at their expense if they choose.

A home warranty will  provide peace of mind for the new home-owners. Depending on the warranty purchased, a home warranty can cover all major systems, including, plumbing, electrical, HVAC, roof and appliances. Most home-owners fear a big-ticket item breaking down and wiping out their savings or reserve cash. The home warranty can relieve those fears and assure a buyer that you have their back.

Sell your home with Cornerstone Business Group, Inc., and we'll provide a home warranty to sweeten the deal.When you sell your home with Cornerstone, we have you covered. Our goal is to make sure your home is listed and sold for the most money in the shortest amount of time. A home warranty will encourage buyers to know they can put away worries about major home repairs. That alone may be the issue that pushes a home-buyer over the decision hurdle.

List and sell your home with Cornerstone Business Group, Inc., and kiss your home goodbye!

Sell your home with Cornerstone Business Group, Inc., and we’ll offer a home warranty to sweeten the deal.

*Some restrictions apply.

Buying a house starts with getting your ducks in a row.

Buying a house starts with getting your ducks in a row

Buying a house starts with getting your ducks in a row. If you do, you’ll have a much smoother transaction with much less stress. Where do you start? Not with a Realtor.

Duck Number 1

Buying a house starts with talking to a qualified and reputable lender. There is no sense Buying a house starts with getting your ducks in a rowin riding around looking at houses if you don’t have a really good idea of what you can spend. Start with a lender.

A lender will look at your assets, debts, income and other resources to see what you can actually afford. You want to know that up front. Having that number in your head will keep you from looking at homes you fall in love with, but you can’t buy.

A good rule of thumb is to keep your mortgage payment 40% or less of your monthly income. Some lenders will allow you to go to 50%, but at some point, you end up house poor and no longer loving your beautiful new home. Find that magic number and then decide what you feel comfortable with. Carry that visit with your lender through to the pre-approval process. It is more attractive to a buyer than a pre-qualification.

The pre-approval from a lender means the lender has looked at your bank statements, tax returns and other documents that confirm your income and expenses. A pre-qualification is based on your word about your ability to buy. The hard copies of your statements give the lender the confidence to put a number on your pre-approval that he/she knows you can pay. Go with the pre-approval. 

Duck Number 2

Once you’ve found your magic number, stop spending as much money as you can. Don’t use your credit cards any more than you can pay off each month. Keep your debt low and paid consistently and on time. Don’t go out and buy a new car, a house full of furniture or anything else that would create a revolving monthly payment.

Pay your cell phone, your electric bill, your cable bill, your water bill, your car payment, your student loans, your credit cards, and any other debt you now have – on-time every-time from the day you meet the lender until you close on your house.

Duck Number 3

When buying a house, hire a qualified, responsive, interested, engaged and professional real estate agent. I use this long list of adjectives because not everyone meets this bar (and they should). Interview different agents to see if you feel comfortable with the person. Make sure your personalities flow together smoothly.

Find someone who has experience, and make sure they know how to work all phases of the real estate business. Ask questions. Don’t be afraid of offending them.They understand.This will be one of the biggest events in your life, and you want your agent to be an asset to you and not anything else.

Do a social media search for the agent your contemplating. Look at their Facebook page, website, Linked In page, and any other social media site Realtors may frequent. Google their name and see if they show up in the Google listings. See if there are good and bad reviews online. Remember, some bad review may simply be someone trying to derail the agent’s business for their own personal reasons, and some good reviews may just be family. But, if the reviews are consistent across the board, you may have found a match.

Duck Number 4

When buying a house, do your first home showings in the agent’s office. Narrow down your criteria so that you can spend your time fastidiously. Remember, driving around with a great Realtor looking at 100 houses is creating a deficit for the Realtor. The wasted hours spend looking at houses that have not chance of becoming your home are wasted hours and no income for the agent.

Narrow down your search in their office and then head out. I had two clients look at 60 houses a piece. They were back to back clients and it took three months to look at 120 houses. During those three months, I let multiple ready-to-buy clients go because I had appointments with those two clients. They both bought, but it is hard to tell how many other sales I missed while driving around looking at everything that caught their eye. Today, we narrow the showings down to a much lower number in my office before hitting the road.

With the high volume of photos, videos, Google Earth and other resources available on the web, buyers don’t need to run around looking at a high volume of homes. Many websites give such high quality data that a buyer can feel like he’s done a walk-through before seeing the house.

These are just the beginning phases of buying a house. There will be many more things that come into play as you narrow down your search and write a contract, but start at the beginning and you’ll be much happier with the results.

When you’re ready to make that purchase, give your Cornerstone Business Group, Inc., agent a call. We are you local real estate sales pros, and we will help you find that right house at the right price.

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