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Tag: residential real estate

NoVa housing forecast: Still tight for single-family homebuyers

In the Northern Virginia Association of Realtors’ mid-year forecast released Friday, a panel of real estate experts predict a continued tight market for single-family homes and higher residential prices in the second half of the year, but the market appears to be normalizing from last year’s heights.

“This year, the mid-year update is particularly relevant as the effects of the pandemic subside with vaccine rollouts,” Terry Clower, director of George Mason University’s Center for Regional Analysis and professor of public policy, said in a statement. “While there is still uncertainty regarding the future of the pandemic, the housing market seems to be stabilizing after several months of atypical behavior — strong sales in mid-winter, price increases not seen since the boom of the early 2000s, and unusual weakness for prime location condos.”

The report covers Fairfax and Arlington counties, as well as the cities of Alexandria, Fairfax and Falls Church. Single-family residences are expected to see the largest price increases in the fall and winter of 2021, with a 16.4% year-over-year rise in Arlington, 8.6% in Fairfax and 7.4% in Alexandria at year’s end. Townhouse prices are predicted to rise by 6.8% in Fairfax and 3.5% in Alexandria, but the panel of experts expects a 2.4% year-over-year decrease in Arlington — although those prices will still be elevated due to shortage of housing. The decrease reflects the unusually strong market late last year, NVAR reports.

Single-family homes are still in a tight buyer’s market, particularly in Fairfax County, which is expected to have only 400 active listings in December. By comparison, there were 2,674 listings in June 2015. Arlington and Alexandria are expected to have only 71 and 17 single-family homes listed in December, respectively.

Condos are expected to be less volatile than other housing, with price increases ranging from 1.6% to 3.3%.

As for inventory, there are more condos expected to go on the market later this year, with active listings expected to range from 561 to 640 in Fairfax, 360 to 429 in Arlington and 180 to 216 in Alexandria. Townhouse inventory is expected to decline but remain relatively steady the rest of the year.

Northern Virginia Realtors saw a 58% increase, or nearly $1.5 billion, in the amount of real estate sold in September 2020 compared to the same time period in 2019, according to the NVAR’s report released last October.

“Investing in a Northern Virginia townhome is likely as close to a sure thing as you can get in real estate,” Clower said in Friday’s report.

Fed says Fifth District economy growing moderately

[wpdiscuz-feedback id=”z7qx6rb9ba” question=”Why?” opened=”0″]Amid the post-pandemic recovery[/wpdiscuz-feedback], the Federal Reserve’s Fifth District (including Virginia, North Carolina, South Carolina, West Virginia and Maryland) has been seeing moderate economic growth in recent weeks, according to the latest edition of the Federal Reserve’s Beige Book, which was released Wednesday.

The Beige Book is published eight times per year and is based on anecdotal information gathered from the 12 Federal Reserve Banks about economic conditions in their districts.

The Fifth District saw growth in manufacturing, district ports, trucking companies and retailers, especially of home goods and clothing, according to the report.

Employment rose modestly, but firms continued to struggle to fill open positions. Some employers told the Fed that they had been investing in automation or using more part-time workers as a result of staffing shortages. Wages rose modestly, with entry-level wage increases creating pressure to raise existing workers’ wages. Employers also are using nonwage incentives such as referral bonuses.

Price growth increased slightly from an elevated rate. On average, service sector firms saw a 4% increase in prices received compared to a year ago, according to the Federal Reserve Bank of Richmond. Firms across sectors reported increases in input costs but said they were only passing a portion of those to customers.

Manufacturers reported increased demand, but many were unable to meet it because of shortages in labor, raw materials and equipment, according to the Fed. Additionally, transportation issues delayed orders.

Fifth District ports handled record volumes of imports — mainly of retail goods — and exports — largely of agriculture products. Ports began storing imports because of trucking and rail disruptions. Trucking companies experienced a high volume of retail and industrial goods but were unable to meet demand because of labor and equipment shortages.

[wpdiscuz-feedback id=”6acax0jf6n” question=”When?” opened=”0″]Auto sales picked up overall, but car sales were limited by low inventory levels due to microchip shortages.[/wpdiscuz-feedback]

Travel and tourism showed growth, but labor shortages continued to cause hotels and restaurants to limit capacity or services. Some beach-area hotels had record-breaking occupancy, however.

The average selling prices of listings in residential real estate increased as the average days homes stayed on the market decreased. Commercial real estate leasing picked up and office vacancies declined as more companies returned to onsite work, according to the report.

Banks reported modest loan growth, solid credit quality and historically low default rates. Temporary labor and supply shortages contributed to soft business loan demand and low utilization rates on commercial lines of credit, the Fed reported. Commercial real estate and mortgage lending continued to grow modestly.

[wpdiscuz-feedback id=”nbhf20nhex” question=”What?” opened=”0″]The Beige Book is compiled from reports by[/wpdiscuz-feedback] bank and branch directors, as well as interviews with and online questionnaires completed by business contacts, economists, market experts and other sources. The next report will be released on Sept. 8.

Hampton Roads sees small increase in active home listings

The Hampton Roads area saw growth in new home listings, pending sales and settled sales in May 2021 compared to May 2020, the Real Estate Information Network Inc. reported in its monthly update on the region.

All new listings (listed three days or less) were up 24.74% year-over-year in May, and settled sales saw a 33.57% increase, with 3,378 homes sold in May 2021, compared with 2,529 residences sold last May. Pending residential contracts rose as well, up 26.14% to 3,682 homes from 2,919 homes in May 2020.

There was a small increase in active listings compared to earlier this year, although the buyers’ market remains very tight. According to REIN, there were 3,834 active listings last month compared to 3,780 in April and 3,552 homes in March. By comparison, there were 6,348 homes for sale in May 2020.

The median sales price also went up to $290,000, an 8.61% increase from last year and up 1.75% from April. Construction remains relatively slow due to the rising cost of lumber and other materials, and newly constructed residences saw only a .97% increase year over year.

“I believe this trend will stay the course through the summer and into the fall,” REIN Board President Harry Cross said in a statement. “But my crystal ball rolled off my office desk and shattered about 20 years ago. With low inventory and multiple offers pushing the median sales price higher and higher, agents are working double time for their clients right now. This is definitely not the time to think you can brave the real estate market on your own. What a fantastic time to be a seller though! Just a few weeks ago, the weekly REIN Report advertised a median days on market of eight days. Eight days, can you believe that?”

Graphic courtesy REIN

Virginia sees 12% increase in new listings in April

The state saw a 12% increase in new residential real estate listings since March, according to Virginia Realtors’ April 2021 Home Sales Report released last week.

Although it’s typical for new listings to increase between March and April, the organization notes that this year’s gain was larger than in recent years, and new listings were up 33.5% from April 2020. In total, 17,558 new listings came on the market in April, and there were 13,413 home sales in the state last month.

Statewide, the median sales price was $355,643 last month, up 12.5% compared to last year, and demand continues to be high. In April, homes were on the market an average of 25 days, 16 days faster than the average in April 2020.

A report on Hampton Roads’ residential listings showed some upward movement in inventory in April, although not as much as the state as a whole.

Graphic courtesy Virginia Realtors

Virginia’s median home price jumps 9.8% over previous year

On April 20, Virginia Realtors reported that the median statewide home sales price  for March was $335,000, up 9.8% from a year ago.

Outlined in Virginia Realtors’ March 2021 Home Sales Report, the trade association reports that home prices have been rising quickly since last summer, with year-to-date home prices up in nearly every market in the state. The growth has been fueled by strong demand, limited inventory and extremely low mortgage rates.

“In the current competitive market, many buyers are engaging in bidding wars, offering over list price and making a range of concessions to improve their offers,” said Lisa Sturtevant, Virginia Realtors’ chief economist.

Virginia saw 11,518 home sales in March, about 1,000 more than the previous March, an increase of 9.6%.

However, the state’s dwindling inventory of available homes could cause a cooldown in the spring market. Virginia Realtors reports that supply was “very limited” at the end of March, with just 15,787 active listings, more than 13,000 fewer active listings than a year earlier, representing a decline of 45.8%.

NoVa housing market remains hot

Northern Virginia is continuing to see high levels of housing activity, a trend also taking place around the state and around the country.

In an April 13 news release, the Northern Virginia Association of Realtors (NVAR) states that March saw a 54% month-over-month increase in new contract activity in the region, with 2,781 new pending contracts and a 26% month-over-month increase in total pending sales.

“More housing inventory came on the market in March, yet those listings were snapped up quickly; there are simply more buyers than available homes for sale,” said Derrick Swaak, 2021 president of NVAR and a partner and managing broker with TTR Sotheby’s International Realty in McLean, in a statement. “As a result, total dollar sales volume in March was up 25% versus the same month last year. The average March sales price increased 7% across Northern Virginia compared to last year as prospective buyers often found themselves in multiple offer competitions, pushing the limits of what they can afford.”

Realtors in the region also reported an increase in “sight unseen” offers by buyers because of the limited supply of homes. In an informal poll by NVAR of 115 respondents on April 7, more than one-third had presented an offer on behalf of clients who had not actually seen the home; almost one-half had received a “sight unseen” offer on behalf of their seller clients.

“If we’d done this poll two years ago, we probably wouldn’t have seen [these results],” said David Howell, executive vice president and chief information officer with Alexandria-based McEnearney Associates.

While the total number of active listings was down at the end of March compared to the previous March, the number of new listings increased about 9% in the same timeframe. March’s new listings also exceed the previous month’s: There were 2,029 new listings in February 2021, compared to 3,067 new listings in March.

On average, homes on the market in Northern Virginia sold in 20 days in March. That is 25% below the five-year March average of 27 days. Homes continue to sell above listing price, with an average sale price of 101.4% compared to its listing price.

Last month saw 846 active condo listings and 555 active single-family detached homes available. In contrast, last year saw 467 condos listed for sale and 1,217 single-family homes available.

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Virginia sees major housing inventory shortage

Across Virginia and the nation, real estate experts are singing the same tune: We’re facing a major housing inventory shortage that shows no signs of letting up soon.

“Inventory is down about 44% compared to a year ago and it’s about a third of what it was five years ago,” says Lisa Sturtevant, chief economist for Virginia Realtors, adding that she’s heard of numerous cases of Virginian homeowners receiving offers on the first day that they put their homes on the market.

While housing inventory has been on the decline for at least the last five years, real estate experts say the current draught has reached an unprecedented level. Where Virginia once saw five or six months’ worth of housing supply — a measure that imagines how long it would take to sell the current inventory of houses if all indicators remained constant and no new houses were put on the market — the real estate industry is now counting housing supply in terms of weeks. As of this February, Virginia had 1.3 months of supply.

Another key metric is the average number of days a home is on the market. In 2017, the average Virginia home on the market took 80 days to sell. In 2020, it took 52. This February, the state average was 35 days, with homes in Loudoun County averaging just seven.

According to the National Association of Realtors, overall housing inventory fell 43% across the country in January, compared to the previous year, and new listings were down 23% year over year.

Many factors are contributing to the current dearth of houses. Not only are mortgage rates at historic lows and millennials increasingly entering the homebuying stage of their lives, but baby boomers are staying in their homes longer for various reasons, freeing up fewer homes for the market. And boomers who wish to downsize are finding themselves competing with millennials for some of the same homes.

New construction has yet to reach pre-Great Recession levels and is being constrained by materials costs and supply chain issues caused by the pandemic. Additionally, the pandemic has made some homeowners fearful of putting their homes on the market and interacting with potential buyers.

“What you end up with is a really quick drawdown of inventory to levels that we haven’t seen before,” Sturtevant says.

It’s a trend taking place across the state. In Central Virginia, 25.3% fewer new listings were put on the market this February compared with the previous year, and the number of days on market was cut in half, from 46 to 23. Meanwhile, the median sales price grew 22.2% and the average sales price grew 14.8%.

“It’s a challenge across the board. It’s a challenge in most price ranges. It’s incredibly acute in the first-time homebuyer market,” says Laura Lafayette, CEO of the Richmond Association of Realtors. “We’re seeing multiple offers. We’re seeing buyers waive inspections. We’re seeing all-cash offers. We’re seeing offers well over the listing price.”

Ryan McLaughlin, CEO of the Northern Virginia Association of Realtors, reports similar conditions in his part of the state.

“In Northern Virginia, inventory has been a challenge long before COVID. It’s only been exacerbated by the COVID pandemic,” he says.

Overall inventory in Northern Virginia was down 8.7% in February, compared with the previous February. The past five years have averaged 1.2 months of housing inventory, McLaughlin says, but the region is now seeing 0.81 months of supply.

In an area that already has high housing demand, McLaughlin says, Northern Virginia has only seen a slight change in average days on market, moving from 26 days on market in February 2020 to 27 days on market this February.

Interestingly, McLaughlin adds, Arlington and Alexandria are seeing an increase in condo inventory, as the pandemic has led some condominium owners to sell and purchase houses. Additional condos are also in development in the area, spurred by the massive hiring taking place for Amazon.com Inc.’s HQ2 East Coast headquarters.

So, what’s left on the market? Sturtevant says that at the close of 2020, Virginia had 15,712 active listings, many of which had been on the market “a really, really long time.” While she doesn’t have much data on these houses, Sturtevant bets that they are in “really bad condition.”

“If a home is being priced right, no matter what price range it’s in … the inventory is being brought down at all price points,” she says.

Eventually, demand will slow because home prices have risen so much, mortgage rates will increase and construction may ramp up, but Sturtevant believes the housing drought will continue for a while. “It’s going to be more of the same, though by the end of the year I think demand is going to be a little softer, supply might be a little easier,” she says. “We’ll still see prices going up, but not at the same rate that we have been seeing.”

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Homes sell above listing price in Virginia

In its February 2021 Home Sales Report, Virginia Realtors says that homes in Virginia sold above their asking price on average, sales have quickened, and housing inventory has continued to shrink last month.

For several months, strong demand, limited inventory and historically low mortgage rates have driven price growth in Virginia. In February, the median sales price statewide was $320,000, up nearly 10% from the previous year. Home prices have quickly risen in the past seven months, and the median sales price in Virginia is now $59,000 higher than it was five years ago.

With the pandemic further shrinking inventory, homes on average are selling significantly faster. In February, homes were on the market an average of 35 days statewide, 17 days faster than a year ago.

There were 8,804 total home sales in February, 1,400 more than the previous February, and an increase of 19.2%. Though these figures may suggest a booming sales market, the report warns that activity this spring will be slower than a typical spring because of dwindling inventory. At the end of February there were just 15,712 active listings, more than 12,000 fewer active listing that a year prior, a decline of 43.7%.

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February activity signals busy spring for NoVa home sales

The pace and price of home sales in Northern Virginia likely signal a busy spring for the real estate sector, according to the Northern Virginia Association of Realtors (NVAR).

In a news release, the association states the average February sale price was 100.2% of the listing price. The total dollar volume of the region in February was $985,594,433, which was 27% higher than February 2020 and 10% higher than January 2021. This reflects earlier than usual spring market conditions, according to NVAR, with 25% more closed sales this February than the previous February. There were 2,222 contracts pending at the end of February 2021, up 6.5% from the previous year.

A total of 1,497 homes sold in February 2021, a 25.5% increase above February 2020, which saw home sales of 1,193. The number of active listings decreased last month compared with 2020. Listings were 6.8% below last year, with 1,579 active listings in February, compared with 1,695 homes available in February 2020.

The average days on market for homes in February 2021 rose by 3.9% to 27 days — compared to 26 days on market for homes in February 2020. New listings fell by 8.7% in February compared with last year, to 2,029. There were 2,222 new listings in February 2020.

The average home sale price rose by 2% compared with last February, to $661,391. The February 2020 average sale price was $647,681. The median sold price of homes this February, which was $570,000, rose by 1.8% compared to the median price of $560,000 in February 2020.

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Va. saw 10.8% increase in home sales in 2020

Virginia saw a 10.8% increase in the number of homes sold during 2020 compared with the year before, according to a report released by Virginia Realtors. It marks the fastest growth in annual sales seen in Virginia in more than five years. 

During 2020, 139,908 homes sold in Virginia, compared with 126,305 homes sold in 2019. Eastern Virginia saw the largest increase in homes sold with a 29.4% jump. Northern Virginia saw the largest number of homes sold in 2020, with 49,185 sales. In 2019, 44,725 home sold in Northern Virginia.

Virginia also saw the median home sales price in 2020 up to $319,902 compared to $295,000 in 2019 — an 8.4% increase.

In December 2020, there were a total of 12,525 homes for sale with 8,151 pending sales statewide in Virginia at the end of the month. The number of homes for sale was a 32.4% increase from December 2019, resulting from high demand for homeownership. Median sales price statewide jumped to $325,000 for December 2020, a 10.2% increase from the same period the year before.

“The foremost challenge for Virginia’s housing market has been a lack of supply,” Virginia Realtors Chief Economist Lisa Sturtevant said in a statement. “Declining inventory has limited options for would-be homebuyers and has driven up home prices across the commonwealth.”  

Virginia Realtors predicts that homeownership demand will remain high during 2021 while inventory remains low. Home sales will increase, but transactions will slow due to low supply, according to Virginia Realtors.

Graphic courtesy Virginia Realtors.
Graphic courtesy Virginia Realtors.

 

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