Single-Family, Townhouse, Duplex Trends in 2021

Question: Is the single-family home market still as intense as it was earlier this year?

Answer: In January I’ll do a deep dive into the 2021 market performance with a focus on home values, but this week I wanted to dig into some key supply and demand metrics for single-family, townhouse, and duplex homes in 2021 to highlight how the intensity of the market has shifted over the course of the year.

I’m focusing on the single-family, townhouse, and duplex (non-condo/apartment-style) market here because that was the market that exploded locally and nationwide in the wake of COVID. It’s important to note, however, when looking at the Arlington market that we didn’t experience nearly the extreme change as many other regional or national markets because things were already competitive thanks in part to Amazon HQ2 and because COVID-based demand tended to favor less expensive markets and markets that offered more space (land and house).

The trends for Arlington can be summarized below, highlighted by charts to follow:

  • Supply: Supply usually follows a familiar seasonal trend with low supply early in the year, lots of supply coming to market in the spring, followed by a consistent downward trajectory from summer through the end of the year. This year supply did peak in the spring, but maintained a more consistent volume of new supply through the rest of the year, with a surprisingly high number of homes offered for sale in Q4. My best guess for the strong Q4 numbers is that homeowners witnessed such impressive appreciation of their homes in the first half of the year (and second half of 2020) that they wanted to take advantage of current prices instead of timing the market for peak spring demand. It will be interesting to see if this negatively impacts listing volume in 2022.
  • Demand: Demand trends were consistent with their normal seasonal trends, albeit above average through the course of the year. Demand picked up quickly in Q1 and peaked in the spring, followed by a tapering of intensity in the 2nd half of the year. I believe that the tapering of the demand metrics in the 2nd half of the year was a combination of factors including, but not limited to, sellers raising prices based on first-half market performance, many of the most desperate buyers finding homes, buyers dropping out, and buyers focusing less on their home search as vaccines allowed people to return to travel and other plans. I expect strong demand in 2022, but without the crazy price appreciation we had in 2021.

The charts below highlight my supply and demand findings. A few notes on the data that makes up the charts:

  • The data is based on when a property was listed for sale, not when it sold. This gives us an accurate assessment of how the market performed at specific times during the year vs a trailing indicator of demand (using date sold)
  • I broke the year into two-week periods because I think it gives the right perspective on the information we want from the data
  • To aid your reading of the charts Period 5 starts on Feb 21, Period 10 starts on May 2, Period 15 start on July 11, Period 20 starts on Sept 19, and Period 25 starts on Nov 28
  • I removed new construction from the data because the way it’s listed often doesn’t reflect actual market conditions
  • I removed homes with zero days on market because it generally reflects a pre-market/off-market deal and they aren’t helpful in this type of analysis

The Market Moved Quickly, Gave Buyers Little Time to Think

Many buyers were forced to make significant purchase decisions in a matter of hours or even sight unseen to secure a good home. During peak spring demand, less than 20% of homes listed for sale sat on the market for more than two weeks and nearly 60% went under contract in less than one week.

Most Buyers Paid Over Asking Price

On average, buyers paid .2% over the asking price this year and for those who went under contract during a home’s first week on the market, the average buyer paid 2.8% over asking, peaking at an average of 5% over ask in the 9th Period (homes listed April 18-May 1). Remember, these are averages, there were plenty of people paying significantly more than that over the asking price.

Things have gotten slightly more manageable for buyers in the 2nd half of the year with a lot more homes selling at or below asking price, but even with tapering demand, buyers in the 2nd half of the year who go under contract in the first two weeks a home was listed paid an average of 1.5% over ask.

Supply Unusually High in 2nd Half, Average Days On Market Increasing

As noted above in my summary, supply volume broke familiar seasonal trends with a consistently strong flow of listings coming to market through the 2nd half and even into Q4. Thus, slightly less demand and unusually high new supply has led to modest increases in average days on market and less fierce competition.

If you’d like to discuss buying, selling, investing, or renting, don’t hesitate to reach out to me at Eli@EliResidential.com.

If you’d like a question answered in my weekly column or to discuss buying, selling, renting, or investing, please send an email to Eli@EliResidential.com. To read any of my older posts, visit the blog section of my website at EliResidential.com. Call me directly at (703) 539-2529.

Video summaries of some articles can be found on YouTube on the Ask Eli, Live With Jean playlist.

VA Market Trends: Arlington vs Fairfax & Loudoun County

Question: How does Arlington’s housing market compare to what you’re seeing in Fairfax County and Loudoun County?

Answer: The Arlington single-family home (SFH) market has been competitive, and prices have increased, but the shift hasn’t been nearly as dramatic as what we’ve seen further west in Fairfax County and Loudoun County.

The Arlington condo market has improved from the end of 2020/early 2021, and prices seem to be coming back, but inventory levels are still much higher than they were in the years preceding the Amazon HQ2 announcement.

Listing Activity Up In Arlington, Normal In Fairfax And Loudoun

The number of SFH listings in Arlington this spring is up noticeably compared to prior years, but the biggest story continues to be the amount of condos being listed for sale. I previously wrote about the historical volume of condo listings we had last fall and that trend has continued through this spring, with the total number of condos listed for sale from March-May significantly higher than any other spring market in the last 10+ years.

The number of SFH listings in Fairfax County and Loudoun County have been consistent with past spring markets, down slightly compared to 2018 and 2019.

Demand Meets Or Exceeds New Supply, Except Condos

Despite higher-than-average listing activity in Arlington, the SFH inventory levels remain very low because there is enough demand to absorb the extra supply. SFH inventory has remained at about one month of supply throughout 2021.

Condo demand has not met the higher-than-average listing activity and condo inventory has steadily increased through the spring, after dropping (and flattening) from 5-year highs this winter. The Arlington condo market has settled at around 2.5 months of supply for the last 6 months, which represents a market that is more favorable to sellers than buyers, but still a significant shift from the post-Amazon HQ2 market with 2-3 weeks of supply for about 18 months.

Demand in Fairfax County and Loudoun County has been exceptionally high and inventory levels remain dangerously low with just 2-3 weeks of supply for nearly the last 8 months.

Prices Are Up (Of Course)

Prices for SFHs in Arlington are up, with the median price of a SFH in Arlington exceeding $1.2M for the first time ever in May. While the prices in Arlington are up noticeably, it’s nothing compared to the massive appreciation seen in Fairfax County and Loudoun County over the last four months where we’ve seen up to 15-20% year-over-year increases in prices throughout both markets.

Condo prices have increased from late 2020/early 2021 and seem to be settling in a bit below pre-pandemic numbers. I didn’t include a chart for condo prices because there’s too much variability and it doesn’t provide much value.

Escalations Over Ask Are The Norm, Likely To Change Soon

This spring, the average SFH in all three markets has closed for 3-4.5% over the original asking price. I expect this number to come down over the next few months as asking prices catch up with what the market is willing to pay and the attention/priorities of buyers starts to shift to other things like travel, events, and seeing family and friends.

If you’d like to discuss buying, selling, investing, or renting, don’t hesitate to reach out to me at Eli@EliResidential.com.

Video summaries of some articles can be found on YouTube on the Ask Eli, Live With Jean playlist.

2021 Home Design Trends

Question: What design trends are you seeing this year?

Answer: Over the last few years, home design has turned from neutralized white/grey trends that have been popular for most of the last decade, especially in new construction, to include warmer colors and more natural looks, although these trends have yet to show up in most new construction projects I’ve seen (single-family and condo).

Each year every design magazine, paint company, and furniture store comes out with their annual design trends. I collected some of the most common trends I found across all of them, as well as those that I’m seeing show up more in homes in the DC Metro, and compiled them into some fun graphics.

The impact of COVID shows up in a big way in many trends including trying to bring the outside in (plants/indoor gardens and wood-grain kitchens) and getting more out of existing spaces (closet-offices and outdoor kitchens). Let me know what you think and if you’ve introduced any of these colors, designs, or improvements to your home recently!

If you’d like to discuss buying, selling, investing, or renting, don’t hesitate to reach out to me at Eli@EliResidential.com.

2020 Home Design Trends

Question: What changes are you seeing in design trends this year?

Answer: Every year I look forward to the Pantone Color of the Year selection (released annually since 2000) and this year is one of my personal favorites – Classic Blue. I’ve noticed blues showing up a lot more in homes lately, especially in kitchens (it makes for a beautiful cabinet color, in my opinion).

Pantone Color of the Year 2020 Classic Blue & Steve

But trends go well beyond colors so for an expert opinion on the latest design trends, I’d like to re-introduce Caroline Goree (caroline@madiganschuler.com), a Designer with a boutique Residential Interior Design Firm, Madigan Schuler, located in Alexandria Virginia, to provide insight into what trends we should expect to see in 2020.

In 2018, Caroline introduced us to one of my favorite design quotes from Matthew Frederick’s book 101 Things I Learned in Architecture School, “Being nonspecific in an effort to appeal to everyone usually results in reaching no one.”

Take it away Caroline… 

Thank you, Eli. I am really excited for the trends we see happening in 2020 primarily because people are experimenting with color, textures and patterns much more than in the past few years. While those “safe” design decisions like all white kitchens aren’t necessarily going to go of style, I like seeing more personal flare and individuality come through. Below are some of my personal favorite trend hello’s and goodbye’s of 2020.

Goodbye One-Stop Shoppin’

Thanks to Restoration Hardware, the “all gray everything” trend was popular for the better part of the last 5+ years. Thankfully, that “one-stop shop” mindset is shifting to consumers wanting a more collected look.

Maybe that means a sofa from a known store, such as Restoration Hardware, mixed with vintage velvet club chairs found at Miss Pixies in Washington DC. Add in your grandmother’s fabulous antique chest for a coffee table (hard to believe you once referred to is as old “brown” furniture) and a natural fiber rug so your room has that layered, collected look.

Personally, I am thrilled the trend is moving towards an appreciation for a well curated space using unique items that are not all new and mass produced. Interior Designer, Nate Burkus, once said “Your home should tell the story of who you are, and be a collection of what you love.”

Hello Square Tiles

Thanks to Chip and Joanna Gains (and 90% off the local flippers) subway tile is officially overused and seen in just about every kitchen or bathroom completed since 2015. While timeless (after all, it is named after the 3×6 tiles installed in 1904 in the New York Subway Station) we are ready to explore other shapes and textures.

My personal favorite, square tiles, offer a more unique look but keep the space simple and sleek. From matte concrete tiles in mudrooms, to hand painted terracotta tiles for kitchen backsplashes, many manufacturers are using this traditional shaped tile with an artistic or creative twist. If square tiles still feel a bit out of your comfort zone, try playing with the scale of rectangular tiles such as sizes 2×9 or 3×12. 

Goodbye Gray Walls

Walk into just about any house on the market in the last five years and you will notice one similarity – gray walls. Many Realtors, Interior Designers (including myself) and Homeowners had their go-to list of grays that would cover entire house interiors top to bottom.

With a new decade ahead of us it is time for a new paint color trend (finally).  White paint brings a sense of sophistication to a space, allowing the walls to highlight artwork, architecture and give a bright yet quiet background to your beautifully collected furniture (see topic one above).

From bright white to milky white and crisp white to creamy white, there is a white for everyone. If you are considering going with a white wall, it is important to keep in mind your trim and cabinetry colors. All whites are not the same so be sure to use samples and see how they blend with your existing paint colors. 

Hello Color and Florals!

Tired of seeing the same styles over and over again? Us too. For example, one of the patterns I have been ready to retire since 2015 is Geometrics. Thankfully, with this 2020 concept of originality and pushing the envelope, we are seeing people much more willing to experiment with color and patterns such as florals.

From Peacock Blue velvet sofa’s to floral fabric covering barstools, furniture is being used to express clients style and favorite colors. For years, many folks associated floral fabric with that Chintz Living Room sofa never to be sat on at an elder family member’s house. Not anymore! We encourage and welcome the new wave of florals as they add incredible interest and naturally create wonderful color schemes in a room.

Thank you, Caroline! I’ve been seeing a lot of these trends pop up lately myself so it’s pretty clear that homeowners and buyer tastes are shifting back to an older generation of design, with a more 21st century touch. Caroline and her team at Madigan Schuler are excellent design resources so feel free to reach out to Caroline at caroline@madiganschuler.com for advice on your own interior redesign or remodeling efforts.