Happy New Year!! Hope you enjoyed the Holidays as we officially start the 2012 work year! I wanted to start off the year with a review of my 2011 Predictions that I posted last December. Looks as though of the 5 I made, I was right on about 3.5/4 of them, and I’m happy to be wrong on the other one! Here’s a recap of the predictions I made and how I did:
1. Interest Rates Will Rise. WRONG! My prediction was that interest rates would go back up to 5%, but I am SO happy to be wrong about this. Interest rates actually hit historic lows this year, hovering around 4% of most of the year but jumping between mid-3% to mid-4%. At the beginning of the year, rates were headed for 5% until the uncertainty in Greece flooded our market and helped drive interest rates back down.
2. Prices will remain flat, with a slight increase. Correct! This one was true, we started the year off at prices similar to 2010, but as the year went on and inventory stayed low, prices increased slightly from last year. For the year, prices were up almost 5% from 2010.
3. The number of sales will remain low. Correct! In 2010, a total of 2,635 properties sold in Arlington, while in 2011, only 2,351 sold, a decrease of about 12%. Low inventory undoubtedly contributed to low levels, but we had so many buyers in 2010 who bought due to the First Time Buyer Credit that we essentially took what would have been 2011 buyers and motivated them to buy the year before.
4. Fewer foreclosures, increased short sales. Half Correct, Half Wrong! Good news actually on this one, BOTH foreclosures and short sales decreased in 2011. In 2010, there were 127 bank-owned and 136 short sales, while in 2011 there were 83 bank-owned and 99 short sales, a total distressed property market share decrease. In 2010, distressed sales were 9.9% of the market, while in 2011 it was down to 7.7%.
5. More construction projects will receive financing, break ground. Correct! While there were several residential properties that broke ground this year, there were several commerical and retail properties that got financing as well. Residential properties included Gaslight Square, 1221 Quinn (condo conversion), Greenbrier Village, Dominion Heights Condominium, Enclave of Ballston, Perry Hall Condominium, Lyon Pointe Condominium, and the Court of Lyon Village.
I’ll post my 2012 predictions tomorrow – after getting 4/5 correct 2 years in a row, I am setting a personal goal of 5/5 in 2012! Opinions? Comments? Let me hear them!