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The spring housing market is off to a swift start with April numbers posting considerable increases in units sold and total sold dollar volume coupled with modest price appreciation compared to April of 2023.  Median home prices were up 3% from last year, settling at $450,000 this April compared to $435,000 last year.  Units sold increased by more than 26%, with 522 units sold this April compared to 414 last year.  This increase is just the second time the market has experienced year-over-year growth since May of 2022 and eclipses the 6% increase posted in January of 2024.  The growth in homes sales fueled a nearly 30% increase in total sales volume with the market boasting over $256.7 million in transactions compared to $197.7 million last April.  The volume increase was seen in every jurisdiction in the FAAR footprint.

“April 2024 proved to be positive for sellers as the increase in sales pricing continues trending upward by percentage,” comments FAAR Director Gary Gardiner.  “Buyers are competing to secure a home in this low inventory market.  As a result, sellers have been able to maximize their equity. Mortgage interest rates remain higher.  Home affordability continues to be a challenge for most buyers who struggle to find a home and the market is highly competitive financially.”

Days on market, the time it takes from when a listing enters the market until it receives a ratified contract and is removed from active status on the multiple listing service decreased 3% going from 27 days last April to 26 this year.

Inventory was up by 10% from last April with 791 homes for sale at the end of the month compared to 717 last year.  New listings remained static with just 3 more than last April for a total of 649 new homes coming on the market.  New pendings sales were also steady from last year with a slight 1% dip from 615 to 608.  “Today’s market proves that there remains a very low inventory of homes available for sale,” continues Gardiner.  “Buyers and would-be sellers considering a move are hoping for lower interest rates as we continue through the second and third quarter of the year.”

The local housing market showed surprising price growth in March despite persistent year-over-year demand decreases.  Median price was up nearly 8% year-over-year coming in at $449,949 this March compared to $420,000 last year.  Total sold volume remained static from last March coming in at approximately $202.3 million, a scant 1% decrease from 2023 numbers.  Units sold fell by almost 8% year-over-year compared to last March with 417 homes selling last month compared to 452 in 2023. 

The regional price increase was driven by high prices in Spotsylvania and Stafford counties, with the latter setting a price record for March.  Spotsylvania County landed its third-ever highest price at $449,000 with an increase in units sold over last March.  Meanwhile, Stafford County posted a whopping $522,500 median price for March, a 10% increase from last year, but that price point was reflected in a downturn in demand of nearly 30%. 

“We’re seeing a pain crunch for first-time buyers as inventory in their price point has aways been a challenge, and it’s very pronounced right now,” comments mortgage lender and FAAR Board of Director Nick Bohn.  “On the bright side, Virginia Housing programs increased flexibility on income limits has really helped expand those opportunities for first-time buyers.  We’re seeing an increase in inquiries for mortgage loans, and we are anticipating high demand for the limited inventory that’s on the market.”

Days on market, the time it takes from when a listing enters the market until it receives a ratified contract and is removed from active status on the multiple listing service decreased almost 20% going from 37 days last March to 30 this year.

Inventory was again all over the place with a slight increase in active listings with the market seeing 704 active homes for sale compared to 693 at the close of last March, a less than 2% increase.  New listings coming on the market were down by nearly 8% with 602 new homes listed throughout last March compared to 555 listed this March.  New pending contracts were up by over 11% this March with 566 pending transactions compared to 509 last year. 

The regional median home price was up again in October, despite shrinking demand heading into the winter season.  The median sold price settled at $440,000 this month compared to $425,000 in October of 2022, representing a nearly 4% year-over-year increase.  Units sold were down nearly 20%, coming in at 410 this October compared to 506 units sold last year.  Total sold dollar volume was down nearly 19%, posting approximately $195.5 million in sales for October of 2023 compared to $240 million in sales last year. 

Spotsylvania County was especially notable in October posting its second highest median sold price on record.  The month saw prices soar to $470,000 compared to $400,000 in October of last year.  This price was eclipsed only by August of this year when median price rose to $472,500. 

Days on market, the time it takes from when a listing enters the market until it receives a ratified contract and is removed from active status on the multiple listing service, was static compared to last October, coming in at 26 days.  Continued constrained supply is keeping days on market down since there isn’t much out there for active buyers to choose from.    

Inventory was also down again in October, finishing out the month with 900 active listings compared to 1,012 last year, an 11% decline.  New listings were down nearly 20% from last October with 514 homes coming on the market in 2023 compared to 638 last year.  New pending sales were down 10% in October, with 424 pending contracts compared to 470 last year.  Inventory continues to be challenged as homeowners experience the “lock-in” effect of having very low existing mortgage rates.  In the last 10 years, the average rate of mortgages in the Commonwealth fell from 5.2% to 3.8% as people bought homes or refinanced existing mortgages when rates sank to their lowest in history.  As rates have increased over the last year, there is a huge delta between what mortgage rate homeowners have right now and what rate they would get if they moved.  This delta locks them into their current properties as they wait for rates to come down before considering a move.

The tide may be turning on increasing mortgage rates as the Mortgage Bankers Association came out with their 2024 projections showing great news for 2024.  “The mortgage rate is predicted to be in the low 6% range by the fourth quarter of 2024,” states FAAR Board of Director Sherrie Shaw.  “Even better, 2025 rates are projected to be in the mid-5% range, which should really help in getting sellers off the sidelines.”  A moderation in mortgage rates will help motivate move-up buyers to list their homes and ease the inventory crunch that has plagued the market for years now.

The weather might be cooling off, but local home prices certainly are not.  The region’s median sold price was up nearly 4% in September coming in at $435,000 compared to $420,000 last September.  Volume of sales continues its downward trend posting a nearly 17% decline from last year, with approximately $207.4 million in sales this September compared to $249.1 million during the same period last year.  High prices and lack of inventory continue to depress demand with units sold down another 21% this September with 552 homes sold last year compared to 435 homes sold this year. 

“The Fredericksburg area real estate market remains subject to various external factors, with interest rates being a prominent influence,” states FAAR Board of Director LeAnn Black. “We are seeing a marginal uptick in the number of days properties spend on the market and this presents a favorable window of opportunity for homebuyers. They aren’t merely searching for any home; they are seeking move-in-ready properties and are often willing to pay a premium for such convenience.”

Days on market, the time it takes from when a listing enters the market until it receives a ratified contract and is removed from active status on the multiple listing service, remained similar to last year.  Houses were on the market for an average of 25 days this September compared to 23 days last year. 

Inventory was also down again in September, finishing out the month with 859 active listings compared to 1,038 last year, a 17% decline.  New listings were down a whopping 37% from last year with 491 homes coming on the market in September of 2023 compared to 775 last year.  New pending sales were down 26% in September, with 414 pending contracts compared to 557 last year.  Mortgage interest rates approaching 8% have would-be sellers holding off, contributing to the already low housing inventory.

“Current homeowners have been benefiting from their prevailing low interest rates, prompting many to remain on the sidelines,” continues Black.  “Home sellers could explore an alternative option: the average home equity in Virginia currently stands at approximately $147,000. Home prices in the area continue to rise steadily. By selling their current homes and utilizing their accrued equity to bolster their down payment on a new property, home sellers can potentially mitigate the impact of current interest rates. This strategic move could prove advantageous in navigating the evolving real estate landscape.”