Planning to Purchase a Home in Northern Virginia?
If you plan to purchase a new home, the process can be discouraging in today’s red-hot seller’s market.
We have compiled the five most common questions heard from our clients.
1. Is the inventory shortage ending anytime soon?
It’s looking like prospective Northern Virginian homebuyers may be able to catch their breath.
According to the National Association of Realtors, from May to June this year, unsold homes rose 3.3%. Even though this increase in inventory isn’t sufficient to satisfy Northern Virginia buyer demand, it should leave buyers with an optimistic outlook on buying leverage and more extensive homes options to pick from.
The Northern Virginia market has notably slowed in the last month, seeing fewer offers and houses staying on the market longer.
A recent report from The Northern Virginia Association of Realtors (NVAR) shows that the market seems to be stabilizing after many months of irregular behavior.
2. Is there any sign of bidding wars slowing down?
According to Virginia REALTORS, Northern Virginia homebuyers should see bidding wars take a possible decline. June 2021 Home Sales Report indicated that home sales numbers kept strong; however, the number of available homes increased.
According to the report, this slight market cooling will help alleviate the bidding mania we have seen nationwide over the past 18 months.
Keep your fingers crossed for a rising single-family home inventory through much of Northern Virginia starting this fall.
3. How can my offer stand out?
With homes getting multiple offers within hours of listing, many Northern Virginia buyers wonder how their offer can stand out in numerous bid situations.
We have come up with several tips to make your offer stand out in today’s seller’s market.
- Offer $1,000 - $2,000 above asking price.
- Increase earnest money.
- Limit contingencies.
- Pay with cash.
- Add an escalation clause.
- Offer a leaseback.
- Hire an agent with connections.
- Be flexible.
4. Will interest rates remain low throughout 2021?
What is the future of interest rates? This is the million-dollar question.
Since shortly after the COVID-19 pandemic arrived in the US, we have experienced historic interest rates. Throughout 2020, mortgage rates hit their lowest levels ever. While we have seen increased rates in 2021, they have stayed relatively low.
However, one of the main questions Northern Virginia prospective home buyers have is, “will interest rates remain low the rest of 2021?”
Freddie Mac’s recent quarterly report shows an expectation of a slow but consistent rise in rates throughout 2021.
According to the report, “...expect low rates and a recovering labor market to be supportive of the housing market.”
5. Should I worry about buying before interest rates increase?
It is inevitable mortgage rates will increase. However, this is not necessarily a bad thing for tired homebuyers exhausted from engaging in bidding wars.
The frenzy of bidding wars we have seen the last year and a half in part have occurred because of record-low interest rates. However, according to recent data, it looks as though the market is cooling off - even if just a little.
With interest rates expected to stay relatively low throughout 2021 and into 2022, homebuyers concerned about snatching a record-low interest rate still have time. And those homebuyers holding their breath for bidding wars to deescalate and inventory to rise may be seeing that sooner rather than later.
Facing Today’s Northern Virginia Market
Hopefully, you feel more prepared to face our local real estate market. Arming yourself with knowledge and working with an experienced agent will help you with a smoother buying experience.