I recently took a thorough look at how the Arlington Real Estate market performed this Summer and Fall, and compared the numbers to the same period of 2017. Here’s what I found:
Arlington Single Family Home Sale Statistics
May 23rd-November 19th 2018
|Sale Date Range||# Homes Sold||Avg # of Days on Market||Avg Sale Price||Sale Price / Original List|
|May 23rd-November 19th 2018||571||53||$1,036,910||99.7%|
|May 23rd-November 19th 2017||679||55||$991,836||98.2%|
Taking a quick glance at the numbers, one thing becomes obvious very quickly: The number of home sales is down significantly this year.
I drilled down further into the sales statistics to try and find out why.
Here’s a breakdown of home sales by price range, along with the numbers from the same period of 2017:
Arlington Single Family Home Sales
May 23rd -November 19th 2018
(Broken Down by Price Range)
|Price Range||Homes Sold 2018 (2017)||Avg # of Days on Market 2018 (2017)||Sale Price / Original List Price 2018 (2017)|
|$750,000 –||133 (211)||43 (42)||97.4% (97.8%)|
|$750,000-$1,000,000||225 (242)||39 (43)||103.2% (99.6%)|
|$1,000,000-$1,250,000||82 (84)||54 (58)||98.1% (97%)|
|$1,250,000-$1,500,000||56 (73)||70 (68)||97.1% (97.2%)|
|$1,500,000-$1,750,000||39 (36)||84 (106)||97.6% (97.8%)|
|$1,750,000 +||36 (37)||112 (104)||96.9% (97.2%)|
Looking at the sales figures by price range, it becomes clear that the large drop in home sales this year is happening mostly at the bottom end of the market: The number of homes sold for less than $750,000 dropped 37% this year over the same period of 2017.
This drop is, without a doubt, due to the lack of inventory in the lower price points of the Arlington market. This has been a chronic problem in Arlington, and I’ve been keeping a close eye on this trend for the past few years. Until this year, the numbers of homes sold has been gradually decreasing:
- In the summer/fall of 2017, there were 211 homes sold for $750,000 or less
- In the summer/fall of 2016, there were 213 homes sold for $750,000 or less
- In the summer/fall of 2015, there were 251 homes sold for $750,000 or less
- In the summer/fall of 2014, there were 268 homes sold for $750,000 or less
In my opinion, the dramatic drop in home sales this year means that the bottom of the market has reached a critically-low inventory point. There are, simply put, not enough homes remaining in the $750,000- price range that haven’t already been sold in the past few years. The low end of the Arlington market is tapped out for now.
Current inventory bears this out. As of November 19th 2018, there are:
|List Price Range||Active Listings||Pending Sales||Months of Inventory|
|Less than $750,000||18||22||0.81|
Current inventory at the bottom end of the market is very low, and will continue to be over the coming six months.
This may have a ripple effect on the upper end of the market as well: Many homes currently listed for $1,500,000 or more were tear-downs bought for less than $750,000 by builders. Fewer homes at the low end of the market means fewer new homes get built in the long run.
Overall, the Arlington market has seen little growth in home prices this year. Home sales figures show a 4.5% increase in average home sale this year vs last year. That number is misleading, however. If we look at home sales of more than $750,000, the numbers show a much smaller increase of only 0.5% in average sale price this year vs last year.
So what do all these numbers mean?
In my opinion, we are experiencing a plateau in the Arlington Real Estate market. There is a decent chance of a moderate downturn in the market in 2019. Due to the consistently high demand for homes, prices will not see a significant decrease. In fact, they will likely remain the same, or increase slightly in the coming year. However, the number of sales will continue to decline as the inventory issues at the low end of the market persist.
If you’d like more information on the market in Arlington, or have questions, please feel free to get in touch.
Till next time,
Lou Sagatov, Realtor®