Anyone who’s looking to make a move soon in Falls Church knows that it’s not only homes which are in short supply here, but the inventory of apartments is low, too.
An online search for apartments found few available. Prices for some exceed large mortgage payments.
Apartments range from $1,515 to $2,953 for a one bedroom, and $1,750 to $6,704 for a two bedroom.
Modera Founder’s Row on West Broad has the highest price for a one bedroom, while the West Broad at the Harris Teeter building claims top prize for the priciest two bedrooms.
The less expensive units are found at Glen Apartments near West Street and Route 29 for the one bedroom, and at Roosevelt Towers on North Roosevelt for two bedrooms.
None of the high end apartments include utilities like what’s found at some lower-priced units, but pricier places offer amenities like a dog run, a pet spa, pet wash station, a pet park, complimentary moving assistance, a library lounge, fire pits in outdoor areas with TVs, and an upper deck for watching parades and fireworks.
Robert A. Young is the president of the Young Group which has 150,000 to 200,000 square feet of residential and commercial properties in Falls Church which are all leased up.
“We have no vacancy of any kind,” he said in a phone interview.
“It’s never happened in my 20 plus
years I’ve owned property.” Typically, an occupancy of 92 to 93 percent for commercial properties is considered “excellent by industry standards,” he said.
From a landlord’s perspective, apartments in Falls Church are in “very, very good shape.” His rent increases for them have been below inflation, at only two to three percent, but “we’ve just done an assessment and found we’re pretty far behind the market,” so his tenants may find a five percent adjustment coming this year.
With a different perspective, Edward P. Novak, Jr., an area real estate developer and president and founder of Nova Ventures, says the market has settled down from its covid highs.
There’s been “a fairly significant slowdown” since the peak of last summer. “It’s not dramatic, but rents were raised by a significant amount” to cover labor and construction costs, and soaring inflation and interest rates.
Now, some commercial developers are having a hard time finding money to build.
“Demand has dropped a bit to a more normal level.”
The National Apartment Association says renters are pausing on making moves and have begun to combine households to save money. Vacancy rates nationally are projected to increase through 2024 and records show rental prices dropped September through November, 2022, although Zillow, a national real estate marketer, says rents were 8.4 percent higher than a year ago.
Two years after the Covid-19 pandemic affected the nation, local home buyers are now seeing more available options as the housing market slows down.
According to a December 2022 Virginia Home Sales Report by Virginia REALTORS — the largest trade association in Virginia, — Virginia’s housing market has slowed “considerably” in 2022 after two “very busy” years, almost returning to pre-pandemic levels.
The report stated that there were about 123,000 houses sold in Virginia in 2022, which is 20 percent fewer than the annual total in 2021. In December 2022, 7,492 houses were sold statewide, a “sharp” drop of nearly 38 percent from the same time last year. A “significant” role in this slowdown could be the rapid rise of interest rates over much of 2022.
Other factors for this decrease in the market is far fewer contracts occurring each month, houses stayed on the market longer and sellers were not getting their asking price, on average, as the year came to a close.
Ryan Price, the chief economist at Virginia REALTORS, said the company produces home sales reports monthly on the Virginia housing market conditions and economic conditions of the state. He stated the City of Falls Church’s housing market has slowed down “considerably,” along with 90 percent of other Virginia counties and cities.
“Smaller markets like Falls Church tend to be more volatile in terms of changes,” Price said. “Because there’s fewer home sales overall, just a few extra or few less can really tip the scales on whether or not it’s shrinking or growing.”
Overall, 87 percent of counties and cities
in Virginia had fewer home sales in 2022 compared to 2021, which from an annual perspective, statewide sales activity is back to pre-pandemic totals, near market levels seen in 2018. These shifts, paired with increases in inventory that remains “tight”, could come as “welcome news” to potential buyers active in the market as houses are taking longer to sell and supply is increasing.
The report also added that the December median sales price in Virginia was $359,000, up 2.6 percent from last year, an $9,100 increase. There was approximately $3.3 billion of sold volume in Virginia in December, which is $1.9 billion less volume than a year ago, a 36.9 percent drop.
Price further stated that the City of Falls Church has been slowing down “dramatically” in the housing market since the summer of 2022, which can be a negative thing for an economy such as the city’s because there’s “residual economic activity” generated from a home sale. However, a buyer in Falls Church can benefit from this as the market slowing can allow one to purchase a house in an easier fashion.
“Our outlook is continued moderation in the market,” Price said. “We expect that will continue in Falls Church.”
In Virginia, there were 16,115 active listings on the market at the end of December. This is a “supply jump” of nearly 20 percent over the same time last year.
The outlook of this report signals that sales activity will “likely be slower” than in 2022, net job growth will likely “flatten out” as economic conditions weaken and prices will remain “relatively stable,” though in some markets they will continue to climb, and prices declines are possible in some pockets of the state.
BY BRIAN REACH FALLS CHURCH NEWS-PRESS
Across the Nation, a nearly four-million estimated housing unit shortage is keeping home prices steady despite interest rate hikes, while rent increases continue to outpace even current levels of inflation. Locally, the housing market is as competitive as ever — between December 2021 and December 2022, the median home sale price in 22046 more than doubled (from $682,000 to over $1,500,000). This is partly due to low inventory — last month only four new homes were listed for sale in the city. Rental inventory is extremely low as well; only six homes and two condos are currently listed for rent within City limits, and less than forty rentals are available across the City’s six apartment complexes — and only two of those go for less than $2,000 per month.
But what does 2023 have in store for
us? While inflation, mortgage rates, supply chain concerns, and worries of a pending recession have many predicting a housing decline in other areas of the country, there are some things to look forward to in our region. “Gone are the days of dozens of offers 10 — 20 percent over list price with no contract contingencies.” said Pam Micciche, realtor at HBC Group in McLean. She further described a more responsible market outlook for the coming year, “In 2023 we will experience more normal price appreciation along with contract contingencies that allow for important due diligence.”
Micciche said pent up demand and persistently low inventory make it an excellent time for a seller to take advantage and get top-dollar for their home. At the same time, those looking to purchase will experience less cut-throat competition, with homes staying on the market longer, allowing more time to find the right fit.
As people are still adjusting to the new year, some may be thinking about ways to improve their homes to keep up with the various housing developments, whether they be general and/or technological upgrades.
Luckily, both national and local organizations have their predictions of what will be “in” and will be “out” in regards to housing improvements and rebuilding/remodeling. They also have ideas about certain items that may make a “comeback” in the year 2023.
Craig Toalson, the chief executive officer of the Home Builders Association of Virginia, said the number of homes entering the “prime” remodeling years — 20 to 39 years old — will grow by 2.9 million by 2027. Kitchen and bath upgrades continue to “lead the way” as the “best return” on investment.
FRED is a home repair company that helps residents in the Washington D.C. metro areas, as well as parts of Maryland and Northern Virginia. Claiming they “do it all,” on their website, FRED specializes in upgrading bathrooms, kitchens and living spaces.
Chuck Khiel, the senior vice president of the FRED Division of Case Design, said the company has seen an increase in requests in wallpaper, something he said is becoming “huge” again. He also said people seem to be trading in their hollow core — fiberboard or laminated — doors for solid interior doors, as well as “luxury” vinyl flooring and LED lighting continuing to be popular additions to one’s home.
One “trend” he and his company have seen be requested by homeowners is “accent walls,” which is a wall whose design differs from the design of the other walls in a room or household. Khiel further stated both a different color paint or a different type of medium — such as tape paint pattern or even a stone laminate — have recently been sought after by homeowners in their dining or living rooms.
As for what he has seen become less popular over the years, Khiel stated carpet “seems to be a thing of the past,” since the company “tears out endless acres of carpet” to place a different kind of floor covering.
Outdoor spaces, such as hardscape patios or screened-in porches, will continue to be popular, according to Khiel. Since its “huge rise” during the pandemic, Khiel said as long as some people continue to work from home, the expansion and design of outdoor spaces will remain a large request among homeowners.
Rose Quint, the assistant vice presi-
home
improvement opportunities this year, remodeling one’s kitchen and bath seems to remain popular.
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dent of survey research at the National Association of Home Builders, said 2023 could see remodeling activity “slowing down” compared to 2022, but will still “outperform” new construction activity. Top remodeling jobs the organization has seen is kitchen and bathroom remodeling, followed by new room additions, basement finishes, window replacements and decks.
Home offices, whether they be renovated or newly constructed, are “increasing in popularity,” according to Quint, due to certain businesses continuing to implement working-fromhome policies. As for exterior improvements, Quint said homeowners and buyers “are looking to be able to spend time outdoors in the comfort and safety of their own home/community,” so patios and walking trails are increasingly being requested.
Claw bathtubs and the color gray are have seen a noticeable decline in popularity for home improvement and repairs, according to Andy Apter, the National Association of The Remodeling Industry’s (NARI) president-elect. He further stated kitchen and bathroom installations, repairs and improvements will continue to be wanted by homeowners, as well as fire pits and outdoor seating areas.
His advice for people who are thinking about improving their house in 2023 is to do research on the internet, especially on a website such as Houzz — a “Pinterest-like” online platform that allows one to search for the types of arrangements they want to have done. He also suggested people should consult with a remodeling professional before jumping into a home improvement situation.
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On Monday the Wall Street Journal quoted national rental increases of 17.6 percent for 2021 and 3.8 percent last year.
The city’s website has a public document which lists 2021 apartment rents. Comparing those figures with 2023 for nine buildings with prices found online, average rental increases of 23.5 percent for one bedroom and 19 percent for two bedrooms are found for the two years. In all cases, the lowest prices were used for comparisons.
Mia Barnes is the property manager at Merrill House Apartments on East Fairfax Street who says everything there is leased up. Rental pricing usually increases about three to five percent a year, she said. Figures from the city’s 2021 list show Merrill House was leasing a one bedroom starting at $1,409 and $1,749 for two bedrooms.
Falls Green Apartments on Roosevelt Boulevard has a current vacancy rate of about six percent, Nicole Herrera at the management office said. The owners “and the market” determine rent increas-
es which she did not know for 2023. A two-bedroom now starts at $2,352 at Falls Green when it was going for $2,045 in 2021, an increase of 15 percent.
Two of Young’s favorite buildings are mixes of residential and commercial uses, the “flower building,” as he calls 800 West Broad and the Read Building, the red brick at 402 West Broad where there’s a branch of PNC Bank.
For the Read, the Falls Church City Council has just approved the extension of restrictive covenants, making some apartments more affordable for teachers and support staff.
These apartments will be reserved at lower rates for those earning between 60 to 80 percent of the area median income through the end of 2032. (The U.S. Department of Housing and Urban Development defines the area median income as up to $63,000 for one person.)
Many tenants are sitting tight, waiting for the growing number of layoffs to end, inflation to slow, and units to open up as the market turns more in their favor. Their days seem to be coming.