I can only hope that January is not an indication of what's to come for the rest of 2010. It was the weakest month in my survey since January 2008! Let's take a look at the numbers (remember that my survery consists of the offices and Realtors located in Leesburg, Ashburn, Sterling and Dulles). We had 290 sales with an average sales price of $323,000 this year. This compares to 320 sales and an average sales price of $454,000 (this was early in the price decline) in 2008! Although I expected the the drop in sales price, we are painfully aware of that, the declining transaction numbers are a shock. If these numbers do not improve we will continue to see seriously eroding market values of our homes.

Lets compare these numbers to December 2009 and January 2009. In December we had 450 transactions and an average sales price of $384,000. This was a much stronger December than I had expected but this is a shocking drop from December to January. If you look at Janurary 2009 with 393 transactions and an average sales price of $322,000 it would indicate that values have remained steady, however there was still an alarming drop in the number of transactions. If we do not have a significant improvement in the “Velocity of Sales” we are in for a very difficult year in both the Real Estate industry and property values. The January 2009 to January 2010 comparison is the best for comparative purposes because they take into account seasonal adjustments.

There is really no place to blame for this stagnant market. Home owners who do not have to sell are sitting on the sidelines waiting for the prices to improve. The majority of our sales are people who have no choice or distressed properties. This continues to drive the prices down. We continue to have lots of buyers and multiple contracts, however until we have a significant increase in non-distressed sales prices will not increase and will probably slowly decline. If you are thinking of selling you will probably get the best price today that you are likely to get for a while and if you “buy up” you are buying at a great price.