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Lindley Estes is a business writer for The Free Lance-Star and Fredericksburg.com. This blog is on Fredericksburg-area business. Send an e-mail to Lindley Estes.

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Local housing prices up, but shutdown fears weigh

Fredericksburg-area housing prices rose to their highest level since July 2008 last month, but some are concerned that the federal government shutdown could hurt the recovery.

The median sales price for Fredericksburg-area homes sold through the Multiple Listing Service in September was $264,900, according to Metropolitan Regional Information Systems Inc. data released Thursday. That was up about 20 percent year-over-year.

The number of local homes listed for sale has been increasing this year as prices have gone up, a trend giving potential buyers more options. There were 1,841 homes on the market in the Fredericksburg area at the end of September and 329 homes sold that month, creating about a 5.6-month supply.

Foreclosures accounted for just 9 percent of last month’s sales. Homes spent 57 days on the market on average before getting a ratified contract and sold for about 4 percent below list price.

Some local Realtors and mortgage lenders are concerned that a prolonged government shutdown could hurt the housing recovery, both due to prospective buyers getting cold feet because of employment concerns and loan-processing delays.

Lenders rely on paperwork from the Internal Revenue Service and Social Security Administration to close loans, and are unable to get required forms due to the shutdown. Many lenders have come up with policies to work around the requirements temporarily, but expect that the shutdowns could delay some closings.

“It’s definitely going to negatively impact the housing market as a whole,” wrote Mac Church, a senior mortgage originator for Fidelity Bank Mortgage in Fredericksburg.

USDA loans have been most impacted by the shutdown, said Brian Whetzel, Fredericksburg branch manager for C&F Mortgage Corp. He added that interest rates remain extremely low, and will probably rise in the not-too-distant future.

The Fredericksburg area comprises the city and Caroline, King George, Spotsylvania and Stafford counties.

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Permalink: http://news.fredericksburg.com/businessbrowser/2013/10/10/local-housing-prices-up-but-shutdown-fears-weigh/

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