Virginia’s housing market recovery is holding steady despite being “tested” by increasing unemployment and interest rates this summer. Last summer we experienced lower 30-year mortgage interest rates and very little change in unemployment. This summer unemployment has increased steadily, reversing the trend we witnessed through the first quarter of 2013 and most of the second quarter. Further, interest rates are increasing as the Federal Reserve Board deems the economy stabilized.
Nonetheless, the Virginia housing market seems to be holding steady and that is a good sign. Seasonal decreases are muted compared to last year. In 2012 we experienced a 12.64% drop in volume transferred. This year, we experience a modest 8.47% drop. Further, the total volume of real estate transferred in Virginia during July 2013 ($3.3B) is a significant 23% year-over-year increase. We hope to see volume increase in August, but more importantly we hope to see this trend of stability and continued market recovery hold throughout the next year.
Analysis and commentary by Ted Koebel, Senior Research Associate, and Mel Jones, Research Associate of the Virginia Center for Housing Research at Virginia Tech.