Thursday, March 16, 2006

NVAR: February Market Summary

The NVAR (Northern Virginia Association of Realtors) just posted their market summary numbers for the month of February:

Although the volume of single family homes and condos sold in February 2006 in Northern Virginia was 20 percent below the units sold totals for February 2005, average sales prices have increased 6 percent, to $514,116.

More than four times as many active listings were on the Northern Virginia market in February 2006 than February 2005, up 316 percent from 1,584 to 6,588.

February 2006 sales volume in the Greater Northern Virginia region was also more than 20 percent below volume in February 2005. Sales prices, however, have increased 9 percent, to $483,872. Greater Northern Virginia includes Fairfax County, Fairfax City, Arlington County, Alexandria, Falls Church, as well as Prince William, Loudoun, Fauquier, Culpeper, Madison, Clark, and Rappahannock counties.

Active listings in the Greater Northern Virginia area were significantly higher in February this year than in 2005. February's total of 14,662 active listings were more than 250 percent greater than the number last year, which was 4,173.

But here is where it gets interesting:

These numbers here are for single family homes, condos & coops sold in Northern Virginia. Which include "Counties of Fairfax and Arlington, and the cities of Alexandria, Falls Church, Fairfax, and the towns of Vienna, Herndon and Clifton"

Please note that the 2005 YTD (year to date) Avg Sales Price number (blue square) which is 479,321 does not match the number listed in the February 2005 Northern Virginia Report which is 479,935. When you do the math for the numbers, the 2005 reports makes sense as
$1,659,616,463 divided by 3,458 equals 479,935 and not 479,321. There is an error here in the NVAR data. The difference between the numbers is only $614.

In Northern Virginia, for January 2006 the YoY (year over year) average percentage price increase was 10.03% which is more then the February 2006 YoY average price increase of 6.09% (red circle). As we move further into the year, the year over year percentage increase continues to fall. The same pattern has happened for the Greater Northern Virginia area.

By April 2006, the YoY sales price increase will be NEGATIVE for Northern Virginia. There will be no spring boom this year.


  1. Condos up 428% (416 -> 2200).

    Wow, with an empahsis on the ow.

  2. I've been waiting for this report for weeks.


  3. Always fun to see NVARs new numbers. I just looked at last years stats and I'm thinking May for the first YoY negative figure. April is definitely possible, however. I'm eagerly waiting for a Washington Post headline with the words "house", "price", and "decrease" in it. A lot of people are still in denial but these Feb figures show otherwise.

  4. I saw the stats yesterday just as I was leaving the office. Looks like every trend established in previous months has continued into February. March will really be the teller. If this trend continues, March appreciaiton should be basically flat, and April negative, like you indicated.

    I've updated the graphs on my blog to reflect this new data:

  5. For Northern Virginia, average prices are down almost 2% in just one month and are down over 8% since the peak last summer.

    Feb 06 vs. Jan 06 = -1.9%
    Feb 06 vs. July 05 (the "peak") = -8.2%

    Why does the news media ignore the 8% decrease in prices in less than a year? That should be headline news.

  6. steinravnik,

    "March will really be the teller"

    I fully agree.

  7. While I fully believe there's a bubble just like everyone else here, and as a renter looking to buy I'm waiting for the pop, I wanted to make one point about the data:

    If you look at past years, in 2004, 2003, and 2002, we had two straight months of declines in Jan and Feb before prices started tracking upwards again in March. I'm not saying the same thing will happen again, but I just wanted to point out that two months of declines from Dec-Feb aren't unprecedented.

  8. but it did not happen in 2005. See my latest post.

  9. I agree that 2005 was an anomaly. My point, however, was that 2002-2004, which were not "bust" years (in fact, all three had greater Jan-Dec appreciations than 2005 did) started out the same way 2006 has.

    That having been said, we're seeing a lot of things that didn't happen in 2002-2004, such as an explosion in inventory and cratering sales. But let's not jump the gun and call this a bust based on only two months of price decline, when it mirrors what happened in recent years which turned out okay.

  10. "But let's not jump the gun and call this a bust based on only two months"

    There are many other reasons why I'm calling it a bust. Inventory, rising interest rates, major decline in speculative buying.

  11. I have to agree with Anon. at 6:59AM. It's too early to say in April we will see a negative YOY increase. Acoording to my observation, things are definitely moving faster this month than Jan and Feb. My guess is that there will be a short boom from March to June so price will probably keep the same or even increase slightly. But after June, we will probably begin to see a YOY decrease, that's when things getting really interesting.

  12. Why does the news media ignore the 8% decrease in prices in less than a year? That should be headline news.

    I'm astonished by this as well. If big media is so silent on substantive issues such as this, what else are they being silent on?

    Thank god for small media. How many 20 somethings would have bought a 450K condo in 2005 if it wasn't for the internet and blogs such as this?

  13. arlingtonva,

    Thats why this blog is here. To report on what is being unreported in the housing market.

  14. But let's not jump the gun and call this a bust based on only two months of price decline, when it mirrors what happened in recent years which turned out okay

    Just my 2 cents: I'm sick of the anonmymous B.S.

  15. From today's levels, prices will have to rise 9% by June to avoid having negative YoY comps this summer. With growing inventory, shrinking sales, and rapidly rising interest rates is it really likely that we'll see prices jump 9% in the next four months? I don't think so.

    YoY will go negative soon, its just a question of when. My quess is May at the latest.

  16. My LL's agent called today and my unit in the Acadia at the Metro (Vienna, that is) is finally going on the market. Add one more condo to the glut.

  17. arlingtonva - you are just as anonymous as everyone else. BTW, last time I posted (on a different blog, I believe) you jumped all over me because I said that sales seemed to be fairly brisk in my neighborhood.

    Well, a house down the street sold in 2 days. It was listed over 1million- which i thought was high.

    Anywho, that is what is happening in my 'hood.

    Now you can start firing at will.

  18. Houses are still selling fast if they are priced right and are quality.

    The jury is still out on a decrease. Deceases in Jan and Feb are not too uncommon, based on these charts. Of course the inventory is higher now and rates are higher - I think the next two months will be key.