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Business & Tech

NoVa Housing Market Shows Signs of Rebound

Low mortgage interest rates, fewer foreclosures and steady home prices indicate Northern Virginia's housing market will continue to improve.

As 2011 winds to a close, signs are hopeful that 2012 will bring continued improvement to Northern Virginia's housing market for counties closest to Washington, D.C.

"I think that we are truly no longer on life support systems," said Jill Landsman, vice president of communications at the Northern Virginia Association of Realtors. "We're seeing steady appreciation in property values, which is a good sign for the future."

According to Landsman, high employment rates, low mortgage rates and growing investment property sales are factors driving the steadily growing activity in the region's real estate market.

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Key indicators show that the housing market has improved from lows reached several years ago, but progress remains tentative. Comparing October 2011 to October of last year, homes stayed on the market five days longer, averaging 65 days. Sale prices also remained at similar levels, averaging $468,454.

Data show counties closer to D.C. have fewer foreclosures. According to a recent report, in Fairfax City, one in every 455 units were foreclosed properties. In Fairfax County, two in every 891 units were foreclosed properties. Arlington County had the lowest rates with only one in every 3,707 housing units a foreclosure.

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Local real estate agent Terry Belt cautions against drawing sweeping conclusions about any area's real estate based on regional or national indicators.

"It's hard to generalize conclusions because real estate is driven almost completelly locally. Within Northern Virginia, you can travel 10 miles and numbers on average sale prices or number of days on the market could be completely different," said Belt, who is the CEO of the Belt Team. "Often when people use aggregate numbers to extrapolate, they are off the mark."

That being said, Belt, who has worked in the region for 25 years, said he's noticed the environment is becoming more positive. 

"There's a lot less fear now than there was in 2008, and expectations between buyers and sellers have improved, which is helping the market recover. When the market was going down, sellers couldn't believe that the house they bought years ago was worth less. Today expectations have adjusted and sellers are putting realistically priced housing on the market."

Looking toward the future, Belt mentioned several reasons why he's hopeful for the housing market's future.

"We've seen growing demand for housing, partly because more people are moving here for jobs, but also because of low interest rates. I've been in this business for years and we're in unprecedentied times in terms of affordability. When I started mortgage rates were around 13 percent, now there are 4 percent rates available. ... Looking at future predictions, despite all the negativity you hear out there, our area is actually forecast to have a housing shortage."

Join us this week as we take a closer look at Northern Virginia's economy:

Monday: See how Northern Virginia is keeping the unemployment rate low.

Tuesday: Learn why the Super Committee's failure to reach a decision could spell out financial losses for northern Virginia's economy.

Wednesday: Hear what local retailers are expecting this holiday season and find out what some top selling items have been so far.

Tomorrow: Wrap up the week with economic guru Stephen Fuller of George Mason University for a discussion on the future of northern Virginia's economy. As federal dollars decrease, where will the economy move?

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