This regularly-scheduled sponsored Q&A column is written by Adam Gallegos of Arlington-based real estate firm Arbour Realty, voted one of Arlington Magazine’s Best Realtors of 2013 & 2014. Please submit your questions via email.
Q. I’ve heard grumblings of the real estate market slowing down. Are you seeing that in Arlington too? If so, why?
A. The real estate market was rocking and rolling last year. Homes were selling quickly again and prices were climbing at a noticeable pace. It feels like some of the frenzy has died down recently, but pockets of the market are still selling quickly. In fact, (according to RBI) Arlington has sold 10 percent more homes in 2014 than at this time in 2013.
I put together the following chart so we can see exactly how different segments of the market are selling, this year compared to last.
My personal theory is that they have oversaturated the rental market with all these new apartment buildings in Arlington. In years past, quite a few renters decided to buy because their rents were rising annually. In some cases it was less expensive to own than rent. Now, we are starting to see rents come down. Renters are more comfortable renting and fewer are buying homes.
If there are more renters and fewer first-time homebuyers in Arlington, some of the people owning those homes that would like to move up are having a harder time selling. There is a trickle up effect that is created from a drop off in first-time homebuyers.
That said, the negative effect of too many rentals is being countered by extremely low mortgage interest rates. Rates just hit another low for the year this past month. We are also seeing current homeowners trying to cash in on the increased value of their homes.
Too many people try to generalize the market with a label… good, bad, strong, soft, active, slow, etc. In my opinion, it would be irresponsible to generalize the market as whole. It is important to study the micro segment of the market you are interested in.
I would love to hear what our readers are seeing out there with the local market. Please share your experiences in the comments.
The views and opinions expressed in the column are those of the author and do not necessarily reflect the views of ARLnow.com.