Now that 2016 has come and gone, I thought it would be good to recap the crazy year that 2016 has been. 2016 was a historical year for real estate due to record low mortgage rates which fell below 3.5% for conventional 30 year fixed loans. The historically low mortgage rates drove up demand and fueled the real estate market throughout 2016. I did some statistical analysis using the data from MRIS to see how Arlington's Real Estate market performed in 2016 compared to that of 2015.
The below graph is a comparison of the median sold price in Arlington for each month in 2015 and 2016. As you will see, 2016 was very different from 2015. In 2016, there was much more of a seasonal effect where the median sold price was significantly lower in the fall and spring and much higher in the summer months. This was different from 2015 as there were not as much drastic changes between seasons. When looking at specific months, July was the most expensive month in both years with median sold prices of $627,000 in 2016 and $625,000 in 2015.
In regards to volume of sales, the below graph shows the number of closed transactions in Arlington in each month in 2015 and 2016. As you will see, 2016 was pretty consistent with the performance of 2015. The lowest number of closed transactions occur in the winter (137 in 2016 and 144 in 2015) and grew steadily before peaking in the summer months (343 in 2016 and 353 in 2015). Thus, if you are looking to buy or sell a home, you will have the most competition from May to August.
As for average sold price, it was slightly higher in 2016. It was $644,265 in 2016 vs. $641,543 in 2015. When looking at days on the market - property, the statistics were almost identical between years. 48.81 days in 2016 and 48.55 days in 2015. Also, demand for Arlington Real Estate increased slightly from 2015 to 2016 with 2892 sold in 2016, and 2855 sold in 2015.
So with all of this said, what will 2017 look like? I predict that demand will remain consistent with 2015 and 2016. As the mortgage rates start to slowly increase, increasing home prices will correspondingly slow down to a home appreciation of around 3.5% per year. In closing, do not expect the real estate market to deviate much from its seasonal patterns and continual growth.