September Va. housing market slowest in over a decade

Virginia’s housing market last month was the slowest September the state has had in more than a decade, according to a Virginia Realtors report released Friday.

Virginia home sales in September dropped 21.1% from the same month last year. Home sales totaled 8,023 last month, down 2,149 home sales compared with September 2022. The September market was last this slow in 2012, which had 7,005 sales that month. In the Hampton Roads region, there were 2,032 settled sales last month, down 595 sales from last year, a 22.65% drop, according to the Real Estate Information Network (REIN).

Higher interest rates and tighter inventory subdued last month’s sales.

In the week ending Sept. 28, the average 30-year fixed-rate mortgage was 7.31%, up from 6.7% in the week ending Sept. 29, 2022, according to Freddie Mac data. That was a 22-year high, according to Fortune. For the week ending Oct. 19, the average 30-year fixed-rate mortgage was even higher: 7.63%.

The statewide median sales price last month was $380,000, up $15,000 from September 2022, a 4.1% increase. Homes spent a median of 10 days on the market, down from 13 days a year ago. In the Hampton Roads region, the median sales price was $333,000, up from $310,000, or 7.42%, in September 2022. Homes in Hampton Roads spent a median of 17 days on the market, down from 18 days last year, according to REIN. The national median sales price for existing homes last month was $394,300, according to the Federal Reserve Bank of St. Louis.

“Many potential buyers are currently in ‘wait it out mode,’ while others are being priced out of the market all together,” Virginia Realtors Chief Economist Ryan Price said in a statement. “One positive piece of news for those buyers is that while, on average, prices are still climbing, the rate of growth is slowing.”

That trend will likely continue because of higher mortgage rates, which could soften price growth in some markets, Price said.

At the end of the month, there were 18,188 active listings in the state, down 1,605 listings, or 8.1%, from a year ago. New listings accounted for 10,606 of those, down 13.3% from 12,231 in September 2022. In the Hampton Roads region, there were 3,778 active listings, down 6.85% when compared with last year. Many homeowners are hesitant to sell because of the 3% or lower mortgage rates they received when they bought their homes, Fortune reports.

But, while inventory continues to drop overall in the state, some smaller markets are seeing growth.

“The sharpest reductions in listings continue to be in Northern Virginia, as well as some segments of the Richmond metro region,” Katrina M. Smith, Virginia Realtors 2023 president, said in a statement. “Parts of western Virginia, including the Shenandoah Valley and New River Valley, have more listings on the market than a year ago.”