February has become the new spring, according to panelists at the Fredericksburg (Va.) Area Association of Realtors' 2020 Vision: FAAR Housing Outlook round-table meeting.
The seven participants, who included Realtors, brokers, and representatives from a builder and a credit union, said they anticipate another strong year for home sales and only a modest increase in prices.
Local real estate sales grew nearly 21% from 2018 to 2019, ending the year with a total $2.324 billion. The market also saw a 3.34% year-over-year increase in median price, going from $299,990 in 2018 to $310,000 in 2019. Units sold increased more than 16%, finishing out the year at 6,978 compared to 5,997 units sold in 2018, according to FAAR.
"2020 is already off to a strong start," said FAAR President Drew Fristoe. "I personally have clients in the wings, just waiting for the right time to jump into the market."
The number of houses buyers will have to choose from, however, is expected to remain low locally and they're expected to sell quickly.
Last year, houses averaged 42 days on the market before they received a ratified contract. That's a 42% decrease from 2018, when houses averaged 72 days on the market, according to FAAR. And more than 32% of the houses sold in 2019 went under contract in 10 days or less. The majority of sales were single family homes with three or more bedrooms. That segment made up over 80% of the total units sold.
That doesn't mean that every house will sell, cautioned Chip Taylor, a Realtor with Long & Foster Real Estate, Inc.-Fredericksburg. Buyers are pickier than ever, he said, and they turn up their noses at Formica countertops. Jennifer Sloat, general sales manager at K. Hovnanian Homes, agreed, saying that today's buyers have developed an "HGTV kind of attitude," and expect even houses listed at $200,000 to have a kitchen with granite countertops and stainless-steel appliances.
"Builders will be tasked to offer more at the same price," she said. "That's hard when the price of land is rising exponentially. We're going to be challenged to figure that out."
Panelists noted that several areas in the region are expecting rapid growth, including King George County. It still feels rural, but the Dahlgren area has changed so much over the past five years that it's almost unrecognizable. That area will explode once the two-lane U.S. 301 bridge over the Potomac River is replaced with a four-lane bridge, Taylor said.
Amazon, which has around 400 employees at its new headquarters in Crystal City, is also expected to impact the area as it grows toward its ultimate goal of employing 25,000 people. That will likely force people to look past Northern Virginia to areas such as Stafford County to find more affordable housing, said Michael Gillies, a Realtor with RE/MAX Real Estate Connections in Stafford.
"The question is what sort of influx will we have, and what impact will it have on people who commute?" he said.
Meanwhile, the new VRE commuter rail station in Spotsylvania County has also made it easier for people who live there and in Caroline County to get to work in Northern Virginia, Gillies said.
Caroline, especially along the Ladysmith corridor, is attracting people because of its low tax rate, the ability to get land and be close to Interstate 95, and the ease of getting around what is still a rural area, said Lynn Lenahan, an associate broker with 1st Choice Better Homes and Land.
Growth is helping to put Fredericksburg on the radar for more businesses, said Carl Braun, a Realtor with Coldwell Banker Commercial Elite Fredericksburg. He said that when he'd mention Fredericksburg at conferences five or six years ago, people thought that he was referring to Frederick, Md. These days, they not only know where Fredericksburg is, but they know its cross streets and traffic counts.
