The 3rd Quarter 2011 Virginia Home Sales Report has been released, with many indications that we may be starting to see some stability in many housing markets throughout the Commonwealth.
The annualized pace of home sales (shown above) started to increase again in the 3rd Quarter of 2011. This increase is the first such improvement in this long-term trend since late 2009 and early 2010 when the federal home buyer tax credit was helping to produce market improvements.
As shown above, nearly every region showed an improvement in the pace of home sales during the 3rd Quarter of 2011, as compared to the same time last year. The strongest gains were in Southwest Virginia (+45%), Southside Virginia (+29%), and the Roanoke / Lynchburg / Blacksburg region (+26%).
As we conclude 2011 and head into 2012, Virginia’s housing market will likely be strengthened by low interest rates, rising residential rental rates, pent-up demand, and an improving household balance sheet based on increases in household saving habits.
Despite these tailwinds, however, a return to stability in the housing market may be slowed by employment trends, low consumer confidence, tight lending and underwriting standards and significant policy issues. Recent policy decisions or discussions that could impact Virginia’s housing market include a possible elimination of the mortgage interest deduction, GSE reform, changes in FHA loan limits and a new QRM proposal (Qualified Residential Mortgage) that would require lenders to retain 5 percent of the value of the loans they originate (excluding Fannie and Freddie) unless the borrowers have a 20% down payment
Download the full 3rd Quarter 2011 Virginia Home Sales Report below as a PDF.