The market is HOT, HOT, HOT!! The houses are selling like hotcakes! This is definitely a good sign and shows signs of market recovery! So proof do I have that the market is doing great?
As you know, I do monthly calculations to figure out the absorption rates. Absorption rate are a calculation of supply and demand and is calculated by dividing the total number of active sales by the number of homes sold in a month. The resulting answer let’s us know how many months it will take to sell the entire inventory of homes. I love numbers and have started to calculate the absorption rate for the DC Metro Area, more specifically, I will be focusing on Northern Virginia since that’s my area of expertise and state of licensure.
The numbers used for my calculations are from MRIS MLS and are deemed reliable but not guaranteed. Remember, real estate is local so here are the absorption rates for February in Northern Virginia:
|City of Alexandria – 2.8 mos (↑46.4%)
Arlington County – 2.4 mos (↑46.5%)
Clarke County – 13.5 mos (↓0.3%)
Fairfax County – 3.1 mos (↑31.2%)
City of Fairfax – 2.4 mos (↑65.2%)
City of Falls Church – 2.4 mos (↑91.8%)
Fauqier County – 6.8 mos (↓2.6%)
Frederick County – 6.1 mos (↑26.1%)
|City of Fredericksburg – 12.6 mos (↓43.5%)
Loudoun County – 4.0 mos (↑38.5%)
City of Manassas – 4.0 mos (↑26.5%)
City of Manassas Park – 4.5 mos (↓20.2%)
Prince William County – 3.6 mos (↑36.6%)
Spotsylvania County – 5.7 months (↑29.4%)
Stafford County – 4.2 mos (↑42.9%)
Warren County – 13.1 mos (↓4.4%)
What do these numbers mean? Typically, if absorption rate is 5-7 months, it is considered “normal market.” If it’s below 5, it’s a “sellers market” and if it’s above 7, then it’s a “buyers market.” The percentage indicates how the market has improved (↑) or declined (↓) compared to last month.
So if you’re a seller and want expert advise to list your home or a buyer and want to roam around to find your next home, call me today at 703-577-4320!