Washington Area Real Estate Market Had Busy Summer

photoIt was a good summer for real estate in the Washington area, including Fairfax County. Average home prices increased for the 16th consecutive month in August 2011, according to Evers & Co. Real Estate.

“The dollar volume of sales was up for the second month at 6.6 percent and has been increasing since May,” said Evers & Co. President and Broker, Donna Evers. “With the continuing increase in average home prices and dollar volume of sales, there are positive signs of a steadily improving marketplace.”

Other data backs up this claim. The RBI Pending Home Sales Index shows the summer home sales season in the Washington metro area market finished with the highest number of signed contracts for August in four years.

There were 4,169 contracts signed in August 2011, 8.6 percent less than the 4,563 contracts signed in July, but consistent with seasonal trends. New pending sales were 19.9 percent above the August 2010 level but that increase is exaggerated due to the dearth of activity in the months following the expiration of the federal homebuyers tax credit in April 2010.

The median sales price for August 2011 showed a similar seasonal pattern, declining 3.8 percent to $356,000 from $370,000 in July 2011 but was essentially unchanged from August 2011.

During a time when supply is limited and demand is strong, well-located properties that are priced correctly and show well, continue to receive multiple bids, Evers says.

Also, with record low interest rates and a variety of mortgages available, all buyers should capitalize on the current lending options. For high-end homebuyers, they should take advantage of conforming loan limits immediately. There are just a few more weeks before the temporary conforming loan limits expire on September 30, 2011. These limits range up to $729,750.

“Fortunately, loans up to $417,000 are running in the four percent range, which makes purchases for first time buyers very affordable,” Evers said. “Even though the FNMA limit has dropped to $625,500, banks are offering high-end buyers many more choices, including combination first and second trust loans as well as first trust loans up to $2,000,000. With record low interest rates and a variety of mortgages available, the fall market should to be good, with a continuing increase in price and dollar volume of sales.”