Median sale prices increased in the Fredericksburg region in June, according to the latest Long & Foster Real Estate Market Minute report. The increases ranged from a modest 1% in Culpeper County to a 14% rise in Fredericksburg City. Units sold varied in the region, with Fredericksburg City exhibiting a 13% decline and Culpeper County showing a 28% increase. Inventory ranged from a 31% decline in Caroline County to a 5% increase in Culpeper County.
“When going into this year we had certain expectations about the market and there were market factors that were headwinds for us,” said Larry “Boomer” Foster, president of Long & Foster Real Estate. Foster said that the past six months have met these expectations, aside from a later spring market than anticipated.
Interest rates are staying low and are expected to stay low for the rest of the year. Inventory challenges remain and are not expected to ease up anytime soon. The unemployment rate is also low, and wages are rising, meaning people have more money in their pocket.
While Foster believes the economy is in a strong place now, the federal government has been talking about decreasing the federal funds rate. Typically, this happens when the government thinks the economy is slowing down and lowers the rate in order to stave off recession. However, the 30-year fixed rates are holding steady and interest rates are expected to stay low throughout the year, so the likelihood of a recession is low.
Addressing the aging-in-place trend, Foster said there are a few reasons he doesn’t think people are moving. “Many are afraid they won’t be able to find a place they like once they sell their current home,” he said.
For the most part though, when people get older, they want something that’s more manageable – both physically and financially, he said. Communities for those 55+ are an attractive option because they provide a lot of activities and benefits within a community of similar people. Having a knowledgeable real estate agent will help make the process easier by providing in-depth information that buyers can use to make a fully-informed opinion.
Foster anticipates the rest of the year will be like 2018. “We’re a little bit ahead of where we were this time last year from a volume perspective,” he said. “In terms of the rest of the year though, I think it’s going to be really similar to what happened last year.” Foster said from now until Labor Day the market will slow down a bit before picking up again till Thanksgiving.