2016-07 Virginia Home Sales Report

JULY 2016

Published by the Virginia Association of REALTORS®, the advocate for real estate professionals and property owners in Virginia.

July 2016

The Virginia Association of REALTORS® (VAR) publishes monthly and quarterly home sales reports to provide our members, the media, and real estate‐related industries with current data. The report data comes from a variety of sources and is analyzed by the Virginia Association of REALTORS®. All data may be used with citation to the proprietary owner, the Virginia Association of REALTORS®.

The data presented is based on specific economic regions comprised of counties and independent cities in Virginia, as detailed in the map below. It should be noted that these regions do not necessarily align with the counties and cities that comprise the 28 local REALTOR® associations in Virginia. For example, the economic region defined as Northern Virginia encompasses more counties and cities than those within the bounds of the Northern Virginia Association of REALTORS®. Please take this into consideration when referencing regions.

Central

Southside

Eastern

Southwest

Hampton Roads

Valley

Northern

West Central

Central

Eastern Hampton Roads

Northern

Southside

Southwest

Valley

West Central

Albemarle, Amelia, Buckingham, Caroline, Charles City, Chesterfield, Culpeper, Cumberland, Dinwiddie, Fluvanna, Goochland, Greene, Hanover, Henrico, King & Queen, King William, Louisa, Madison, Nelson, New Kent, Orange, Powhatan, Prince George, Rappahannock, Sussex; Charlottesville, Colonial Heights, Hopewell, Petersburg, Richmond

Accomack, Essex, King George, Lancaster, Middlesex, Northampton, Northumberland, Richmond, Westmoreland Gloucester, Isle of Wight, James City, Mathews, Surry, York; Chesapeake, Franklin, Hampton, Newport News, Norfolk, Poquoson, Portsmouth, Suffolk, Virginia Beach, Williamsburg

Arlington, Clarke, Fairfax, Fauquier, Loudoun, Prince William, Spotsylvania, Stafford, Warren; Alexandria, Fairfax, Falls Church, Fredericksburg, Manassas, Manassas Park

Brunswick, Charlotte, Greensville, Halifax, Henry, Lunenburg, Mecklenburg, Nottoway, Patrick, Pittsylvania, Prince Edward, Southampton; Danville, Emporia, Martinsville

Bland, Buchanan, Carroll, Dickenson, Floyd, Grayson, Lee, Russell, Scott, Smyth, Tazewell, Washington, Wise, Wythe; Bristol, Galax, Norton

Alleghany, Augusta, Bath, Frederick, Highland, Page, Rockbridge, Rockingham, Shenandoah; Buena Vista, Covington, Harrisonburg, Lexington, Staunton, Waynesboro, Winchester

Amherst, Appomattox, Bedford, Botetourt, Campbell, Craig, Franklin, Giles, Montgomery, Pulaski, Roanoke; Lynchburg, Radford, Roanoke, Salem

Published by the Virginia Association of REALTORS Data recorded August 14, 2016

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July 2016

July Market Summary

Virginia residential real estate sales slowed year‐over‐year and seasonally in July 2016.

Performance metrics declined predictably from June, the market’s typical annual peak. Pace and volume declined more steeply this year than last year, but the intensity of the second quarter contributed to a continuing outperformance of 2015 in accumulated year‐to‐date sales.

Sales pace, or number of transactions, for July dipped year‐over‐year by 4.7 percent, from 11,820 sales to 11,265. Sales pace for July 2016 slid 14.2 percent from June’s peak at 13,133. Monthly volume was $3.797 billion, 4 percent lower than last July’s $3.955 billion. Year‐over‐year change in July volume was a reflection of the decrease in pace, as the median price increased by a slight 1.1 percent to $278,000 (from $275,000 last July). Year‐to‐date volume, the sum of each home sale price since the beginning of the year, exceeded $22.071 billion, 5.1 percent higher than the January through July volume in 2015 ($20.992 billion). Typical of industry seasonality, average days on the market lengthened from their June low (58). The average length of time on the market declined year‐over‐year to 60 days, dropping 6.3 percent from the previous July (64 days). The year‐over‐year decline in average time on the market, as well as the increase in median price, indicate continued inventory constraints.

Published by the Virginia Association of REALTORS Data recorded August 14, 2016

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July 2016

Sales Pace ‐ Monthly Single Family, Condo, Townhome 14,000 12,000

10,369 10,000

13,133 11,714 11,265

12,684 11,820 9,169

10,204

9,566

10,154 8,868

8,000

8,748

8,610

7,018 5,912

6,000 4,000

6,527

‐ 4.7 %

2,000 ‐

The number of home sales in Virginia decreased year‐over‐year by 4.7 percent, from 11,820 in July of 2015 to 11,265 in July of 2016. Between June and July this year, sales decreased by 14.2 percent (from 13,133). Seasonal declines are typical as the industry cycles out of the summer peak into more moderate fall months.

Sales Pace ‐ July Benchmarks Single Family, Condo, Townhome 11,820

12,000

11,265

11,500 11,000 10,500

10,457 10,177

10,000 9,500 9,000 July 2013

July 2014

July 2015

July 2016

While July 2016 sales dropped from the prior year, they indicate a continuing trend of significant growth from earlier benchmarks. July pace this year was 7.7 percent higher than in 2013.

Published by the Virginia Association of REALTORS Data recorded August 14, 2016

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July 2016

Median Sales Price Single Family, Condo, Townhome

$278,000

$289,500

$276,500

$265,000

$252,500

$244,900

$245,065

$264,000

$251,958

$250,000

$268,000

$251,930

$270,000

$284,000

$290,000

$275,000

$310,000

$260,000

$330,000

$275,000

$350,000

$250,000 $230,000 $210,000

1.1 %

$190,000

Median sales price for July 2016 rose 1.1 percent year‐over‐year, from $275,000 to $278,000. Month‐ over‐month, median price dropped 4 percent from $289,500. Median price typically peaks in June. A year‐over‐year increase suggests sustained strength in the market and may reflect that inventory continues to be limited.

Published by the Virginia Association of REALTORS Data recorded August 14, 2016

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July 2016

Residential Sales Volume ‐ Monthly Single Family, Condo, Townhome 5

4 3

$3.797

4

$3.955

5

3 2 2

‐ 4.0 %

1 1 0

July 2016 sales volume declined 4 percent from the previous year benchmark. Sales volume measures the total sum of each home sale price in Virginia and, therefore, generally follows sales pace and median price trends. Because the change in median price was slight (1.1 percent increase), the year‐over‐year decrease in volume almost mirrors the change in pace, or number of sales.

Following historic seasonal pattern, July sales tapered from their June peak (to $3.797 billion from $4.613 billion). Historically, volume begins descending in July and continues to decline through fall.

This year’s steep 17.7 percent decline in volume was more pronounced than the June to July change last year (8.7 percent).

Published by the Virginia Association of REALTORS Data recorded August 14, 2016

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July 2016

Average Days on Market Single Family, Condo, Townhome 100 86

90 80 70

78

77 67

62

69

64

78

85 79

77

72

71 62

60

58

60

50 40 30

‐ 6.3 %

20 10 0

Typical of the industry cycle, the average number of days on the market in July 2016 increased from June’s peak performance, but did decline from July of last year. Average number of days on the market in July 2016 (60) decreased 6.3 percent from the prior July (64). Average time on the market lengthens as market activity slows from summer into the third quarter. Limited inventory may contribute to the year‐over‐year quickening between list and close.

Published by the Virginia Association of REALTORS Data recorded August 14, 2016

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July 2016

Virginia Unemployment Rate Source: Bureau of Labor Statistics 7.0%

3.7%

3.7%

Jun‐16

Jul‐16

3.9% Apr‐16

3.7%

4.0% Mar‐16

4.0%

May‐16

4.1% Feb‐16

4.8% Jul‐15

4.1%

4.9% Jun‐15

Jan‐16

4.9% May‐15

4.2%

4.8% Apr‐15

Dec‐15

4.8% Mar‐15

4.1%

4.7% Feb‐15

Nov‐15

4.7% Jan‐15

4.2%

4.8% Dec‐14

Oct‐15

4.8% Nov‐14

4.3%

4.9% Oct‐14

4.5%

Sep‐15

5.0% Sep‐14

5.0%

4.5%

5.0%

5.5%

Aug‐14

6.0%

5.3%

6.5%

3.5% Aug‐15

Jul‐14

3.0%

The Virginia unemployment rate for July 2016 held at 3.7 percent for the third consecutive month.

Though a declining unemployment rate generally correlates to increased consumer confidence, there are indicators that job growth may be occurring in sectors with relatively limited earning potential and therefore limited impact on building financial capacity for homeownership. The state recently reported a shortfall for fiscal year 2016 primarily due to missed revenue collection of income, sales, and corporate taxes.

Average 30 ‐Year Mortgage Interest Rate Source: FreddieMac 4.25% 4.05%

4.05%

3.85%

3.91%

3.94%

3.89%

3.96% 3.87%

3.80%

3.65%

3.66%

3.45% 3.25% Jul‐15

3.69% 3.61%

3.60%

3.57% 3.44%

Aug‐15 Sep‐15 Oct‐15

Nov‐15 Dec‐15

Jan‐16

Feb‐16 Mar‐16 Apr‐16 May‐16 Jun‐16

Average 30‐year fixed mortgage interest rates decreased in July 2016 to 3.44 percent. Rates are likely to remain at historic lows, continuing to offer incentive to prospective buyers. Minutes of the Federal Reserve Bank meeting in late July suggest that a key interest rate increase may be deferred until the end of the year, at least.

Published by the Virginia Association of REALTORS Data recorded August 14, 2016

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July 2016

The Virginia Association of REALTORS® (VAR) is the largest professional trade association in Virginia, representing approximately 32,000 REALTORS® engaged in the residential and commercial real estate business. VAR serves as the advocate for homeownership and private property rights and represents the interests of real estate professionals and property owners in the Commonwealth of Virginia.

NOTE: The term REALTOR® is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of REALTORS® and subscribes to its strict code of ethics.

All inquiries regarding this report may be directed to:

Jenny Wortham Virginia Association of REALTORS® Jenny@VARealtor.com 804‐262‐3755

or

Martin Johnson Virginia Association of REALTORS® Martin@VARealtor.com 804‐249‐5708

The numbers reported here are preliminary and based on current entries into multiple listing services. Over time, data may be adjusted slightly to reflect increased reporting. Information is sourced from multiple listing services across Virginia and is deemed reliable, but not guaranteed.

Published by the Virginia Association of REALTORS Data recorded August 14, 2016

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