Third Quarter 2009
Trends in Virginia’s Housing Markets
For Immediate Release: October 23, 2009 Contact: Lisa Noon, (804) 249-5716 or lisa@varealtor.com Virginia’s housing markets appear to be moving upward, with the lowest point seen in fourth quarter 2008 and steadily improving since then, according to the third quarter 2009 home sales report released today by the Virginia Association of Realtors. “There seems to be no doubt now that we have hit the bottom and are moving back up, in terms of both price and sales activity,” commented VAR President John Powell of Colonial Heights. “We are now in our third consecutive quarter of marked improvement.” Total existing home sales in Virginia are up 5.3 percent in the third quarter compared to the second quarter numbers, and have reached the highest quarterly total in 2009. The statewide median sales price is up 2.2 percent over the second quarter and has increased about $28,000 this year. Nationally, inventory levels have trended down significantly, reaching the lowest level in 2008 and 2009, indicating the market is rebounding across the country as well. The highest percentage increase in sales by quarter was in the North Central region (includes the cities of Charlottesville, Waynesboro, Lexington and Staunton), up 29.1 percent since second quarter 2009. However the Southwest Virginia region posted the largest increase in sales compared to the same quarter last year, with a 7.6 percent increase in sales over 2008. Median sales prices advanced 4.6 percent in the Northern Virginia region compared to the same period last year, while the South Central region showed the largest increase (7.7 percent) in median sales price since second quarter 2009. # # #
Highlights In national news, Congress is considering an extension of the $8,000 first-time buyers’ credit and the possibility of broadening the program to all buyers. Mortgage rates trended down and the weekly conventional rate ended the quarter at 5.04 percent . The stock market exceeded the 9,000 mark in late July and remained in the 9,000-9,999 range through the end of the quarter.
Total existing home sales in Virginia grew to 25,032 units (up 5.3 percent) in 3Q 09 vs. 2Q 09, but were down 2.2 percent vs. 3Q 08. Four of the seven regions reporting showed an increase in sales for 3Q 09 compared to 3Q 08.
The highest percentage increase in sales occurred in the North Central region, up 29.1 percent in 3Q 09 vs. 3Q 08.
The statewide median sales price advanced for the third consecutive quarter to $251,324 (up 2.2 percent vs. 2Q 09 and down only .1 percent vs. 3Q 08). The statewide median sales price has increased about $28,000 this year.
Median sales prices advanced 6.9 percent in the Northern Virginia region from 2Q 09 to 3Q 09. South Central also showed price increases with a 1.5 percent growth from last quarter to the current quarter.
For the same period (3Q 09 vs. 2Q 09), the upper Shenandoah Valley had the largest percentage decline in median sales price, down 12.42 percent compared to 3Q 08.
Comparing 3Q 09 to the same period last year, prices were up in Northern Virginia, South Central, Tidewater, and the upper Shenandoah Valley. Only three of the seven reporting regions showed slight decreases in the median sales price.
The number of foreclosures increased across the Commonwealth (up 7.8 percent) to 18,135 for the quarter. The largest percentage increase in foreclosures compared to 3Q 08 was in the North Central region (up 22.5 percent) while the South Central region had the largest decline (down 32 percent).
Job losses continued to plague Virginia in the third quarter. The state has lost 97,700 jobs this year, particularly in the Professional and Business sector (-28,800). Unemployment, at 6.7 percent, is the lowest among Virginia’s neighbors and is tied for 5th lowest in the country.
The only area to experience a percentage decrease in sales was Northern Virginia, with a slight 2.5 percent decline for 3Q 09 compared to 2Q 09.
Page 2
Trends in Virginia’s Housing Markets
Virginia Quarterly Sales and Median Sales Prices: 2008—2009 $269,165
25,000
24,855
Total Sales
$259,903
$280,000
Sales MSP
25,599
25,032 23,779
$251,547
$251,324
$245,823
22,500
$270,000 $260,000 $250,000 $240,000
20,000
$230,000
$223,221 17,951
17,500
16,567
$220,000
$207,047
Median Sales Price
27,500
$210,000
15,795
15,000
$200,000 1Q08
2Q08
3Q08
4Q08
1Q09
Sales by Region Region
2Q09
3Q09
Median Sales Prices by Region 3Q09
vs. 2Q09
vs. 3Q08
Region
3Q09
vs. 2Q09
vs. 3Q08
Central
$199,075
-2.5%
-11.8%
Central
3,400
9.5%
1.8%
North Central
1,176
29.1%
-24.1%
North Central
$250,477
-1.2%
-2.5%
Northern Virginia
10,768
-2.5%
-6.0%
Northern Virginia
$321,833
6.9%
4.6%
South Central
1,014
11.6%
-5.1%
South Central
$134,995
7.7%
1.5%
Southwest Virginia
1,847
10.7%
7.6%
Southwest Virginia
$155,890
-0.2%
-3.8%
Tidewater
5,941
11.2%
6.2%
Tidewater
$225,542
0.2%
-4.3%
886
11.0%
1.7%
Upper Shenandoah Valley
$174,489
2.3%
-12.4%
Upper Shenandoah Valley
Region Definitions Central Region
South Central Region
Chesterfield, Hanover, Henric o, and the c ity of Ric hmond (Richm ond Association )
Amherst, Appomatox, Bedford and Campbell c ounties, c ities of Bedford and Lynchburg
Caroline, Charles City, Dinwiddie, Gooc hland, King William, Louisa, New Kent,
(Lynchburg Association of REALTORS)
Powhatan, Princ e George, and c ities of Colonial Heights, Hopewell and Petersburg
Danville and Pittsylvania c ounties (Dan River Region Association of REALTORS)
(Southside Virginia Association of REALTORS)
Halifax and M ecklenburg c ounties (Southern Piedm ont Land and Lake Board)
Lanc aster, Northumberland, Ric hmond and Westmoreland counties (Northern Neck
Amelia, Appomatox, Buckingham, Brunswick, Charlotte, Cumberland, Fluvanna, Halifax,
Association of REALTORS)
Lunenberg, M ec klenburg, Princ e Edward, Nelson, Nottoway, and Powhatan c ounties
Essex, Glouc ester, King & Queen, King William, Lanc aster, M athews, M iddlesex, and
(South Central Association of REALTORS)
Northumberland c ounties (Chesapeake Bay & Rivers Association of REALTORS)
Henry and Patric k c ounties and c ity of M artinsville (Martinsville, Henry & Patrick
North Central Region City of Charlottesville and c ounties of Albemarle, Greene, Louisa, Nelson and Fluvanna (Charlottesville Area Association of REALTORS ) Augusta County and c ities of Highland, Waynesboro and Staunton (Greater Augusta
Counties Association of REALTORS )
Southwest Region Dickenson, Grayson, Lee, Russell, Smyth, Washington and Wise counties (Southwest Virginia Association of REALTORS) Allegheny, Bedford, Botetourt, Craig, Franklin, Roanoke, Southampton c ounties and
Association of REALTORS)
c ities of Franklin, Salem and Roanoke (Roanoke Valley Association of REALTORS)
Bath, Buc hanan and Roc kbridge c ounties and c ities of Buena Vista, Clifton Forge,
Bland, Carroll, Floyd, Giles, Grayson, M ontgomery, Pulaski, Tazewell and Wythe
Covington and Lexington (Lexington/Buena Vista/Rockbridge Association of REALTORS)
Northern Virginia Region
c ounties and cities of Galax and Radford (New River Valley Association)
Tidewater Region
Fairfax, Arlington c ounties and c ities of Alexandria, Fairfax and Falls Churc h (Northern
Isle of Wight, Suffolk, York c ounties and c ities of Chesapeake, Hampton, Newport
Virginia Association of REALTORS)
News, Norfolk, Poquoson, and Virginia Beac h (Ham pton Roads REALTORS Association)
Loudoun County (Dulles Area Association of REALTORS)
James City and New Kent c ounties and c ities of Williamsburg and Charles City
Princ e William County and c ities of M anassas and M anassas Park (Prince William
(William sburg Area Association of REALTORS)
Association of REALTORS ) Stafford, Spotsylvania, King George and Caroline c ounties and city of Frederic ksburg
Ac comac k and Northampton counties (Eastern Shore Association of REALTORS)
Upper Shenandoah Valley Region
(Fredericksburg Area Association of REALTORS)
Clarke, Frederic k, Warren counties and city of Winc hester (Blue Ridge Association)
Fauquier, Culpeper, Orange, M adison, Sc ott and Rappahannoc k c ounties (Greater
Page and Shenandoah c ounties (Massanutten Association of REALTORS)
Piedm ont Association of REALTORS)
Rockingham County and city of Harrisonburg (Harrisonburg/Rockingham Association)
Page 3
Third Quarter 2009
Foreclosures in Virginia and by Region
The total number of foreclosures increased in Virginia from 16,827 last quarter to 18,135 (+7.8%) in the third quarter. That followed a 5.5% increase the previous quarter.
Northern Virginia continues to lead the state with the highest number of foreclosures, up 22.5% this quarter to over 11,000. Although it posted a slight percentage decline quarter-over-quarter, the Tidewater Region was in a distant second place this quarter with 3,025 foreclosures.
Quarter Totals Region
1Q09
Central
2Q09
2,053
North Central
1,849
198
218
267
9,983
11,062
South Central
340
334
227
Southwest
450
587
492
Tidewater
2,980 711
3,041 801
3,025 842
Total
15,932
16,813
18,121
Others
12 15,944
14 16,827
14 18,135
Upper Shenandoah Valley
Virginia Total
The North Central region had the largest percentage increase (+22.5%) with the Central region in second place with a 19.3% increase compared to the third quarter of 2008 (see bottom graph).
Both the Southwest and the South Central regions had declining foreclosure rates this quarter.
2,206
9,200
Northern Virginia
3Q09
Source: RealtyTrac
Note: “Others” denotes counties outside the VAR reporting area.
Regional Foreclosures 3Q09 vs. 3Q08 Upper Shenandoah Valley
5.1%
Tidewater
‐0.5%
Southwest
‐16.2%
South Central
‐32.0%
Northern Virginia
10.8%
North Central
Central
So urce: RealtyTrac
‐40.0%
22.5%
‐30.0%
‐20.0%
‐10.0%
0.0%
19.3%
10.0%
20.0%
30.0%
Page 4
Trends in Virginia’s Housing Markets
Virginia Annual Job Change
Job losses as of the third quarter total –97,700 in the state of Virginia, representing the largest annual decline this decade.
The largest decline as of September 2009 was in the Professional and Business Services sector (-28,800 jobs) but the construction industry has suffered the highest percentage loss (-12% year-over-year).
150.0
Virginia’s percentage decline in jobs since last September was 3.1%.
This 3.1% decline compares to
104.2
Annual Job Change (000s)
100.0
86.2
80.7 62.1
50.0
–.5% in DC; -5.1% in North Carolina;
34.9
0.0
-2.1% in Maryland;
3.3
0.5
-4.1% in Tennessee; and
-3.9
–3.6% in West Virginia.
-22.9
-50.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
-100.0
-97.7 Source: BLS, NSA
-150.0
Unemployment Rate (VA and USA) September of Each Year The unemployment rate in the Commonwealth is 2.6 points higher this year compared to September 2008 but the increase across the nation over the same time period was 3.6 points. Virginia unemployment reached a high of 7.1% in May and June 2009. Virginia’s September 2009 rate is tied for the fifth lowest in the country with Iowa, Mon12.0 Source: BLS, SA tana, Oklahoma and Vermont. VA 11.0 The highest statewide unem9.8 USA 10.0 ployment rate is in Michigan (15.3%). The lowest is North 9.0 Dakota (4.2%).
Unemployment Rate
8.0
7.0 5.7
6.0
4.0 3.0
5.4
5.0
5.0 3.9
3.6
4.1
6.2
6.1
4.1
3.6
5.0 3.6
4.5 3.1
4.5
6.7
4.1
3.0
2.3
2.0 2000
2001
2002
2003
2004
2005
2006
2007
2008
Virginia continues to have the lowest unemployment rate among its neighbors—
2009
MD = 7.2%; WV = 8.9%; TN = 10.5%; NC = 10.8%; and DC = 11.4%. As of August 2009, the Danville MSA had the highest unemployment rate in the state (12.5%) and Charlottesville had the lowest (5.6%).
Page 5
Third Quarter 2009
Central Region
Sales in the third quarter of 2009 advanced 9.5% over the second quarter and 1.8% over the third quarter of 2008.
The median sales price has declined again in the Central region, falling 2.5% since last quarter and 11.8% compared to the third quarter of 2008.
3,546
3,341
$245,000
Sales 3,400
MSP
3,500
3,106
3,000
$225,000
$233,816
Total Sales
2,500 2,000
2,218
$225,832
$218,166
$235,000
$215,000
1,884
$204,257 $199,075
1,500
$205,000 $195,000
1,000 $194,766
500
$185,000
0
$175,000 2Q08
3Q08
2Q09
Median Sales Price
4,000
3Q09
North Central Region
Sales jumped 29.1% from the second to the third quarter 2009 but declined 24.1% from the third quarter of 2008.
The median sales price (excluding Greater Augusta area) dropped slightly (-1.2%) this quarter but has ranged between $250,000 and $254,000 in the last four consecutive quarters.
$264,930 1,549
1,600
Note: MSP excludes Greater Augusta
Sales MSP
Total Sales
1,303
1,200
$252,874
$251,524
$253,512
$255,000 1,176
$246,912
$250,477
1,000
911
890 797
800
$265,000 $260,000
$257,002
1,400
$270,000
$245,000 $240,000 $235,000
581
600
$250,000
$230,000
400
$225,000 1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
Median Sales Price
1,800
Trends in Virginia’s Housing Markets
Page 6
Northern Virginia Region
In the Northern Virginia region, total sales declined 2.5% from the second quarter of 2009 to 10,768 units and declined 6% from the third quarter of 2008. Sales rose dramatically in the second quarter 2009; they were up 39.6% from the first quarter 2009.
However, median sales prices had positive growth for the second consecutive quarter (+6.9%) and they were up 4.6% compared to the third quarter of 2008. The last time median prices were over $320,000 was the second quarter of 2008.
11,000
11,457 $346,635
Total Sales
$342,636 10,518
10,000
$400,000
Sales MSP
11,045
$307,812
10,768 $321,833
$350,000
$301,182
$300,000
9,281 $255,965
9,000 $270,301
$250,000
7,912
8,000
$200,000
7,000 6,072
6,000
$150,000
5,000
$100,000 1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
Median Sales Price
12,000
3Q09
South Central Region
For the second consecutive quarter, sales increased (+11.6% from the second quarter and +5.1 from the third quarter of 2008). Sales jumped 45.9% in the second quarter from 623 units in the first quarter to 909 units.
Median sales prices reached the highest level in the last two years; they were up 7.7% from the second quarter and 1.5% from the third quarter of 2008.
1,155
1,100
$130,664
Total Sales
800
$132,994
$134,995 1,014
890
$122,175
$123,164
$125,317
$120,000 $115,000
$110,162
700
$130,000 $125,000
909
867
$140,000 $135,000
1,068
1,000 900
Sales MSP
$110,000
623
600
$105,000
500
$100,000 1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
Median Sales Price
1,200
Page 7
Third Quarter 2009
Southwest Virginia Region
Total sales increased 10.7% this quarter and 7.6% since the third quarter of 2008 to reach the second highest quarterly total in 2008 and 2009. This followed a 68.8% increase in sales in the second quarter of 2009.
The median sales price declined slightly (-.2%) this quarter and also 3.8% since the third quarter of 2008. However, the median did advance 8.1% (about $12,000) in the previous quarter.
1,945
Total Sales
1,700 1,500
MSP
$162,116
1,900 $163,519
$170,000
Sales
1,717
1,847 $157,313
$156,254
$155,890
$153,072
$165,000 $160,000 $155,000
1,668
1,491
$150,000
1,300
$145,000
$144,510
$140,000 1,100 953
Median Sales Price
2,100
$135,000
988
900
$130,000 1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
Tidewater Region
Sales in the Tidewater region climbed in the third quarter by 11.2% and by 6.2% compared to the third quarter of 2008 reaching the highest total unit sales in seven quarters.
For the second consecutive quarter the median sales price advanced. It was up a slight .2% over the second quarter but was down 4.3% compared to the third quarter of 2008.
$240,669
6,000 5,500
$234,045
$235,617 5,787
Total Sales
5,941
$225,102 4,510
$225,542
4,000
$230,000 $225,000
$222,784 3,962
$240,000 $235,000
5,342
5,596
5,000 4,500
$245,000
Sales MSP
$220,000
$216,800
$215,000 3,329
3,500
$210,000
3,000
$205,000
2,500
$200,000 1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
Median Sales Price
6,500
Page 8
Trends in Virginia’s Housing Markets
Upper Shenandoah Valley Region
The Upper Shenandoah Valley had an 11% jump in sales in the third quarter compared to the second and a slight increase (+1.7%) compared to the third quarter of 2008 to reach the highest quarterly total in 2008 or 2009.
The median sales price rose for the second consecutive quarter (+2.3%) but was 12.4% lower than in the third quarter of 2008. It is roughly $37,000 lower than it was in the first quarter of 2008.
$211,984
871
900
$220,000
Sales MSP
$211,322
886
816
798
Total Sales
800
600
$200,000
$199,088
$190,000
679
700 585
$210,000
$170,600 $182,275 $169,761
500
$174,489
$180,000 $170,000
547
$160,000
400
Median Sales Price
1,000
$150,000 1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
Statewide Economic Backdrop
Virginia’s construction starts are part of the South Region and the annualized total advanced 8.7% compared to last quarter. Starts are still 26.5% below third quarter figures in 2008.
The total number of building permits issued in Virginia through August 2009 was 13,181 permits, 25.2% fewer than at the same time in 2008. The number of building permits issued in 2008 on a monthly basis never reached corresponding levels in 2007 and so far in 2009, no monthly total has reached corresponding 2008 levels.
The total number of foreclosures in Virginia during the third quarter reached 18,135 homes, up almost 8% from the second quarter.
Virginia Economic Indicators Starts (South Region) YTD Building Permits
1
2
Foreclosures 3
Non-Farm Employment Unemployment Rate 1
4
3Q09
vs. 2Q09
vs. 3Q08
300
8.7%
-26.5%
13,181
NA
-25.2%
18,135
7.8%
NA
-57.2
-1.5%
-3.1%
6.7
-5.6%
63.4%
Seasonally Adjusted Annual Rate (000s); 3rd M onth of Quarter
2
As of 2nd M onth of Quarter
3
Not Seasonally Adjusted (000s); 3rd M onth of Quarter
4
3rd M onth of Quarter
Virginia typically loses jobs in the third quarter compared to the second but payrolls declined by 57,200 jobs this year, reaching the highest third quarter loss this decade. The second place third quarter loss was in 2001.
Unemployment in the state rose in September but is well below the high of 7.1% reached in May and June of this year resulting in a 5.6% decline quarter-overquarter. The rate at this time last year though was only 4.1%.
Page 9
Third Quarter 2009
National Economic Backdrop
Existing home sales declined in August compared to July but improved 8.1% over May (2nd month of 2Q). Total unit sales improved 3.4% compared to this time last year. The median sales price advanced this quarter but is 12% behind 2008 levels while inventory levels were trending significantly down and reached the lowest level in 2008 and 2009.
New home sales totals are still behind 2008 levels but they rose 24% in August compared to May (second quarter 2009). Median sales prices fell below $200,000 for the first time in 2008 and 2009. Inventory levels have declined all but one month this year to a two year low in August.
Starts
1
Building Permits
1
Existing Home Sales
3Q09
vs. 2Q09
vs. 3Q08
590
0.0%
-28.2%
573
0.5%
-28.9%
2
Sales
5,100
8.1%
3.4%
$177,700
1.7%
-12.0%
8.5
-13.3%
-19.8%
429
24.0%
-4.2%
$195,200
-11.9%
-12.0%
7.3
-28.4%
-35.4%
937,840
5.4%
22.5%
-768
-0.6%
-4.2%
9.8%
3.2%
58.1%
Overall Index
53.1
7.7%
-11.2%
Present Situation Index
22.7
-9.2%
-61.4%
Expectations Index
73.3
11.9%
21.2%
4
5.1%
-6.6%
-16.2%
2Q09
1Q09
2Q08
-0.7%
-6.4%
1.5%
Median Sales Price Month's Supply New Home Sales
2
Sales Median Sales Price Month's Supply Foreclosures Non-Farm Employment Unemployment Rate
3
4
Consumer Confidence
4
Monthly Mortgage Rates
Gross Domestic Product (GDP)
5
1
Seasonally Adjusted Annual Rate (000s); 3rd Month of Quarter
2
Seasonally Adjusted Annual Rate (000s); 2nd Month of Quarter
3
Seasonally Adjusted (000s); 3rd Month of Quarter
4
3rd Month of Quarter
5
Measures percentage change from previous quarter; 3rd Estimate
Virginia Association of REALTORS® • Lisa@VARealtor.com 10231 Telegraph Road • Glen Allen, VA 23059 Tel: (804) 264-5033 • Fax: (804) 262-0497 • www.VARealtor.com
Foreclosures in the third quarter were the worst three months in history. The total of 937,840 homes measured a 5% increase over the second quarter and a 23% increase compared to the third quarter of 2008. Compare the 937,840 foreclosures to the figure in the first quarter of 2008 of 649,917 (+44.3%).