Every year The National Association of Realtors (NAR) releases their annual report of buyers, sellers and general data on homeownership. One of theses data points is the median tenure in a home, meaning how long do Northern VA homeowners live in their home before moving.
The twenty years between 1985-2008, the median tenure averaged exactly six years. However, since 2014, that average is almost ten years – an increase of almost 50%. This trend is expected to move up to even longer to 12 year average time owning a home in Northern VA.
Why the increase?
The fall in home prices in Northern VA during the housing crisis left many homeowners in a negative equity situation. (The home was worth less than the mortgage on the property). This left an uncertainty of the economy and made some NOVA homeowners much more fiscally conservative about making a move.
Fast forward almost a decade with home prices rising dramatically over the last several years we are in a diffrent situation. In the US, 95.3% of homes with a mortgage are now have positive equity, according to CoreLogic. This is also true in our market here in Northern VA.
As a strong economy and wages starting to increase, many homeowners are in a much better financial situation than they were a few years ago.
Another factor as reported by NAR in their 2018 Home Buyer and Seller Generational Trends Report.
“Sellers 37 years and younger stayed in their home for six years…”
These homeowners, who are looking for a larger home to accommodate their growing families or better school districts and are likely to move more often (compared to typical sellers who stayed in their homes for 10 years). The homeownership rate among young families, however, has still not caught up to previous generations, resulting in the jump we have seen in median tenure!
What does this mean for housing?
Experts believe that a large portion of Northern VA homeowners are not in a house that is best for their current circumstance. They could be baby boomers living in an empty, four-bedroom colonial, or a millennial couple living in a one-bedroom condo planning to start a family.
Could the fact that Northern VA homeowners are staying in their homes longer be the reason for the continued low inventory of listings? These homeowners are ready to make a move, and since a lack of housing inventory is still a major challenge in the current housing market, this could be great news.
As seen in the Call Joey Keeping Current Matters Blog here.
Todays New Listings in Northern Va:
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