UNOFFICIAL October Data

November 1, 2005

What we have been waiting for. A quick preliminary peek at the Loudoun residential market. I put the UNOFFICIAL Snapshot in the side bar.

The total sold units dropped like a rock to 383. New pendings are also down substantially. Conversely, new listings and active listings also declined. Average sold price is still up 23% for the year while the average days on market rose to 41 days for sold listings.

What's really interesting is the average sales price rising significantly from last month. This tells me there is more rotation in the middle market with move up buyers and fewer first time buyers. This is consistent with anecdotal evidence showing entry level townhouse activity slowing significantly.

So? Is the bubble bursting? My opinion: no. The Loudoun market is past it's peak and is normalizing. Price appreciation will continue to erode until the fear of buying at the top subsides. We will probably not see double digit year to year price increases as we have the last few years. Supply and demand still drives the market. The regions economy is growing, new jobs are being created at a brisk pace and there is still a shortage of housing inventory across the entire region.

If you have owned a home for more than 2 to 3 years, you still have plenty of appreciation.

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