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Market Recovery Recap

The graph below shows the progression of the Virginia housing market from 2007 to 2014. 2007 (in blue) is the last year before recession. 2008, 2009, 2010, and 2011 (in grey) show the depressed housing market related to the Great Recession. 2012 (shown in orange) was the first year that the market showed signs of recovery, but 2013 (shown in green) is when the Virginia market strengthened enough to show significant recovery. This year (2014 shown in red) the Virginia market performance has also been solidly above recessionary levels, but the sales volume has not been at the level of 2013.

The performance of the 2014 residential real estate market is undeniably tied to the overall performance of the US economy: jobs still aren’t easy to come by, incomes have increased sluggishly, and market participants are still cautious. Nonetheless, the economy is growing, low mortgage interest rates remain a good incentive for buyers to enter the market, and stable prices will keep inventory flowing. The metrics included in the Virginia Home Sales Report indicate that supply and demand remain in sync. Stable prices indicate that our growth is healthy and not related to speculation or overbuying.

Although the market has entered a phase of slow growth, we believe that Virginia has achieved a solid recovery and we certainly prefer steady growth that matches the growth of the overall economy to a bubble based on speculation.

blogimage_q220144Analysis and commentary by Ted Koebel, Senior Research Associate and Mel Jones, Research Associate of the Virginia Center for Housing Research at Virginia Tech

For the full report click here:

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Governor McAuliffe announced additional appointments to his administration last week. Among those appointments was Realtor Shewling Moy of Virginia Beach to the Council on Aging.

Shewling has been volunteering in Hampton Roads for over twenty years in grass-root organizations, civic, business, and academic communities.

Shewling was born in Canton, China and lived in Hong Kong until she was 14 when she immigrated with her family to the United States. She graduated from the Norfolk General Hospital School of Professional Nursing and worked seven years as a registered nurse, while she continued her education and obtained a BS degree in Business Administration from Old Dominion University. She started an accounting business and ran it for twenty years.

Today, she is a Realtor with Coldwell Banker Professional, REALTORS® where she is proudly able to incorporate all of her skill sets including nursing, business, volunteering, and knowledge of the region.

Click here to see the complete list of appointments.

CRS Central Virginia lends a helping hand

The CRS Central VA Chapter is partnering with Caritas Furniture Bank to provide a sustainable resource of furniture for the community’s homeless. Caritas Furniture Bank lends a helping hand to those of the central Virginia community who are moving out of homelessness. They are victims of natural disasters, women escaping domestic violence, people with mental and physical disabilities, including those in addiction recovery, refugee families from all over the world, and elderly persons on limited incomes.

If you are interested in helping out with this project or for more information visit:


Prices indicate inventory and demand are in sync

Sale prices are following their typical spring trajectory, increasing more quickly as we approach summer. The median sale price this April was 3% higher than in April 2013. This modest year over year change is evidence that home prices are stable, and have recovered from the recession. Days on the market fell to an average of 81 days in April, 3.8% higher than April 2013. Days on the market fell to record lows last spring as prices increased very rapidly, likely because inventory did not keep up with demand. Slower price increases and a more typical average number of days on the market indicate that inventory and demand are in sync this spring.

With unemployment and interest rates remaining unchanged, we expect this spring and summer to be slower paced than last year. We believe that high sales last summer may have been a one-time clearing of excess inventory and pent up demand. Many people who had been waiting for prices to recover sold their homes while buyers took advantage of still low interest rates in the face of increasing prices.

blogimage_1_05192014Analysis and commentary by Ted Koeble, Senior Research Associate and Mel Jones, Research Associate of the Virginia Center for Housing research at Virginia Tech.

Click here for the full April 2014 report.

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And we’re off!

Sales picked up in February, but really took off in March, increasing 23.5% over February. Unemployment and mortgage interest rates remained stable, so the March sales increases are simply an expression of the season. Median sales price has been rising steadily since January, likely drawing more sellers into the market. In addition to the seasonal increase in sales, you’ll notice from the graph below that we may be experiencing a decelerating market recovery. The success of 2013 may be explained by clearing of excess supply and pent up demand. Now in 2014, we are facing the reality of a very slowly growing economy. We can expect sales to follow their historic seasonal trajectory, but this year we may only see slightly more sales than we saw in 2012. The Federal Reserve, Congressional Budget Office, and many economists expect slow economic growth over the next few years and incomes remaining stagnant. Although the recovery will undoubtedly continue as long as supply keeps up with demand, the pace may not be as exciting as it was last spring.

blogimage_1_042114Analysis by Ted Koebel, Senior Research Associate and Mel Jones, Research Associate of the Virginia Center for Housing Research at Virginia Tech
For full report click here.
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NAR survey: members’ experiences with flood insurance

On April 15, 2014, FEMA issued a WYO (Write Your Own) Company Bulletin implementing the first provisions of the Flood Insurance Affordability Act and providing immediate rate relief to homebuyers. In the bulletin, FEMA directs insurance companies to stop charging full-risk premium rates when older properties are sold after May 1. Instead, buyers will be allowed to assume the seller’s current rate until FEMA issues new rate tables and refunds under the new law. NAR will continue pressing FEMA to implement the rest of the rate relief provisions according to the statutory deadlines.

The “Grimm-Waters” Flood Insurance Affordability Act allows property buyers to assume the seller’s current premium rate, instead of immediately increasing to the full-risk rate at time of sale.  NAR is asking members for information about your most recent transaction for a property that required flood insurance to learn if and how this provision is being implemented.

Complete NAR’s questionnaire here.

Housing market slow to thaw

The pace of Virginia homes sales increased in February, but only by 3.15% despite decreasing unemployment and mortgage interest rates. Prices remained fairly stable and days on the market continued to increase, indicating low demand rather than restricted supply. So what is holding back demand? Even though the market is not picking up as fast as it did last year (sales are down 7.55% from February 2013), many housing economists predict that 2014 will be the strongest sales year since the Great Recession. Since interest rates and employment are working in the market’s favor, winter weather seems like the main barrier for buyers and is certainly a barrier for builders. Although access to credit may be slowing the housing recovery to some degree, we expect to see better performance in the Virginia housing market once we are free of snow and ice. Long-term decreases in unemployment, stable interest rates, stable prices, and new inventory coming onto the market should all bode well for spring sales.

Analysis and commentary by Ted Koebel, Senior Research Associate and Mel Jones, Research Associate, of the Virginia Center for Housing Research at Virginia Tech

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We’re ready for spring

The Virginia housing market has made it to the end of the winter season. January is usually the month with the fewest sales and the lowest prices and January 2014 is no exception. Sales decreased substantially after a relatively strong December, but January 2014 sales were similar to January 2013.

Based on previous years, we can expect the market to pick up through February and March. As the weather warms, we hope that builders will face fewer winter weather events and move full steam ahead, increasing inventory throughout the state. The unemployment rate continued to drop in December and although the January rate has not been released, we expect that Virginia continues to perform better than the US as a whole and that the unemployment rate fell in January.

Interest rates dropped in January, stalling the increases we experienced from October to December. Based on the Federal Reserve’s most recent statements, we expect interest rates to remain fairly stable into the spring. Decreasing unemployment and steady interest rates could accelerate the spring market.


Analysis and commentary by Ted Koebel, Senior Research Associate and Mel Jones, Research Associate of the Virginia Center for Housing Research at Virginia Tech. 
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For the full January 2014 Home Sales Report, click here.

Due to the incoming weather, Governor McAuliffe has declared a state of emergency in Virginia.

What this means for Get Active:

  • REALTOR® Day on the Hill — legislator visits — are still going on as scheduled, starting at 9:30 AM. (The snow will not begin until the afternoon.)
  • However, all sessions and functions after noon Wednesday through Thursday have been cancelled.

Once again: Day on the Hill will still take place, with a legislative briefing at 8:00 AM Wednesday.  Boxed to-go lunches will be available to take from the Omni Hotel at Noon.

Please drive carefully — your safety is our first priority.

Virginia finishes 2013 strong

[Edit: Fixed a type in the first sentence; we accidentally swapped the years! Thanks to Wayne Duke for catching it.]

Virginia home sales were 7.58% higher in December 2013 than in December 2012, making a strong finish for the year.  Compared to the previous three years, Virginia sales were higher in every month of 2013 except for November when sales dipped below 2012 levels. Despite a slow pace in November, quarter four sales were up 2.86% year-over-year. Year-over-year increases in sales are evidence of Virginia’s strong and consistent market recovery.

Lower unemployment and mortgage interest rates likely contributed to increased sales in December. Unfortunately, increases in sales were not experienced throughout the state, raising concerns about limited inventory in some regions. Struggles with inventory may be pronounced because we are entering the depth of the seasonal decline. Based on historic trends, we can expect to experience a slow pace of sales in January and February and then come out of the slow season in March. Second quarter sales will tell us whether we can expect to see the recovery continue or plateau.


Analysis and commentary by Ted Koebel, Senior Research Associate, and Mel Jones, Research Associate of the Virginia Center for Housing Research at Virginia Tech.

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