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ArlingtonReal EstateRealtor Q&A: Where's the local market headed?

Realtor Q&A: Where’s the local market headed?

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It’s never easy trying to discern the future, but the Sun Gazette asked some local real-estate professionals where they think the local market is heading over the coming year.

There were some common themes as well as some differing viewpoints:

David Howell, McEnearney Associates: “Should interest rates continue to rise, a further contraction in demand would be expected. The market over the next 12-18 months will simply be quieter than it has been since the emergence from the COVID lockdowns. Fewer contracts and fewer listings. ‘Normal’ might be a better way to describe it, and we haven’t seen a normal market here in quite some time.”

Joan Stansfield, Keller Williams Realty: “We expect 2023 to remain strong and continue to favor sellers, and the inventory to remain low in many areas, which keeps prices high. As the buyer frenzy diminishes, removing people from the market who can’t afford to buy, some buyers can still buy [despite] the escalating rates.”

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Betsy Twigg, McEnearney Associates: “We won’t have the same wild bidding wars as before and there won’t be those huge price surges of homes we had in 2020 and 2021. We will have a typical winter slowdown with fewer homes on the market and fewer buyers. Higher interest rates will dampen the chance for people to buy. Smart people will put their homes on the market early next year, because that’s when we have the lowest inventory.”

Casey Samson, Samson Properties: “The 2023 year should be much more balanced. In most areas, 40 percent of the homes are now withdrawing unsold. Homes sitting and withdrawing are priced 10 percent higher than homes sold or under contract. Understanding current pricing will be critical. We will have a shortage of listings next year as sellers do not want to move from their current 2.5-percent loan to a 5.5-percent loan on the new home. Buyers, however, will now be able to buy the home they need without massive competition and escalating prices.”

Karen Briscoe, Huckaby, Briscoe, Conroy Realty Group, Keller Williams Realty: “There is still very strong pent-up demand for buyers who previously didn’t get a home. So it will be a demand-driven market. There will still be more buyers than sellers out there in most segments, just not maybe a dozen buyers for every property like before.”

Lori Shafran, Yeonas and Shafran Real Estate: “I think in the very near term, the local market will remain somewhat slow and sluggish until the elections are over and will remain less active through the seasonal slowdown during the holiday season. While the national media continues to forecast gloom and doom for the U.S. housing market, our local market will continue to remain somewhat resilient because of the incredible demand associated with jobs, federal spending and companies headquartered in the tri-state region. I think that the real estate market in 2023 will prove to be a more balanced market.”

Laurie Mensing, Long & Foster Real Estate: “We are returning to a normal market and I believe we will continue to see a normal market into 2023. We will also continue to see low inventory, so condition of property is becoming most important for a seller to maximize exposure and an offer that meets their expectations. Inflation is affecting the buyer, as many are holding onto their cash, but investors will continue to invest in the market of real estate.”

Jack Shafran, Yeonas and Shafran Real Estate: “There are still a lot of out-of-town buyers with interest in this area. In the short term, a good house will sell if priced right. Six months from now it depends on where the interest rates go. A year is too far out to gauge.”

Lizzy Conroy, Huckaby, Briscoe, Conroy Realty Group, Keller Williams Realty: “Opportunity knocks in any market. We will continue to see low inventory in the Northern Virginia suburbs, which means sellers who price and prepare their homes correctly for the market will benefit. While interest rates are on the rise, they are still historically below the 50-year trend line. Unlike during the COVID market frenzy, buyers will regain some leverage in the form of contract contingencies and price negotiations. Over the long term, the Northern Virginia market grows in value. This should give confidence to buyers that owning real estate in our area is the right move.”

Eli Tucker, Eli Residential Group: “I think we are in for a very slow and frustrating quarter four, and possibly quarter one. Once inflation gets under control and interest rates come back to a manageable level, I think we will see competition pick back up, but not nearly to the levels we saw from 2021 to early 2022. There are a lot of buyers on the sidelines waiting for rates to come down, and new buyers will enter the market over the coming months to create a backlog of demand once rates drop.”

Rob Ferguson, RE/MAX Allegiance: “A lot is going to depend on inventory. People are still buying and selling and there still remains more buyer demand than inventory. I anticipate the inventory to remain low, as it traditionally does this time of year, through March 2023, and then it will be interesting to see what happens at that point.”

Carol Ellickson, TTR Sotheby’s International Realty: “I think the market will be slow and steady. There are always people getting married, getting divorced, starting families, losing a loved one, moving for new jobs, needing more room, needing less room, etc.”

Dean Yeonas, Yeonas and Shafran Real Estate: “The average time of a house being on the market might be longer and there still will be consistently low inventory. There will be fewer buyers because of the economic environment we are in.”

Jean Beatty, McEnearney Associates: “I think house prices are going to stabilize or maybe fall a little bit in the next year as interest rates continue to rise. I also think that the contract activity will be a little slower than what we have been seeing, but the real-estate market will still be very active. Fortunately, the local area tends to have a more stable housing market because we have a lot of industry here, including the federal government, contractors and tech companies.”

Dawn Wilson, TTR Sotheby’s International Realty: “A lot will depend on where interest rates go. If rates go down, we will be seeing the market pick up steam from where it is now. If rates go up, we will see more of a slowdown. If rates continue to stay about how they are now, we will see a slower market than we have had from 2020 until now, but there will still be buying and selling activity and it should be more of a normal market than we have seen recently. It will be more balanced and not as strong of a sellers’ market.”

Marybeth Fraser, Keller Williams Realty: “The shrinking supply of listings will keep the market in favor of sellers, but longer days on market and slower price increases means some relief for home buyers. We project the market will cool off with interest rates increasing. Prices will flatten a bit or increase slightly as we have experienced when interest rates were between 6 and 9 percent between 1993-2008. It’s still a good time for sellers to cash out the high equity they have in their homes, and for buyers to take advantage of the market ‘cooling off.’”

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