The regional median home price was up again in August, with every locality seeing increases. The median sold price settled at $450,000 in August of 2023 compared to $427,000 in August of 2022, representing a nearly 6% year-over-year increase. Units sold were down 25%, coming in at 516 compared to 691 units sold last August. Total sold dollar volume was down over 18%, posting approximately $256.2 million in sales for August of 2023 compared to $313 million in sales last year.
“In the thriving real estate landscape of the Fredericksburg region, a fascinating interplay between factors is shaping the current market conditions,” states FAAR Board of Director Matthew Rathbun. “The realm of rising home prices harmonizing with gradually increasing interest rates has unquestionably left its mark on the real estate landscape. We are observing a small, but notable rise in the months supply of available housing, along with sales prices commanding an average of 103% of the initial asking prices.”
The City of Fredericksburg posted its highest median sales price on record, coming in at $535,000 in August, up 31% from last year. The City is a smaller market so more subject to fluctuations in the housing stock sold, but that number is still notable. The City’s lowest median price in the last ten years came in May of 2015 with a median sold price of just $210,575.
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 static from last year. Houses were on the market for an average of 23 days this August compared to 22 days last year.
Inventory was also down again in August, finishing out the month with 848 active listings compared to 979 last year, a 13% decline. After trending up into the 1,000+ homes on the market for the second half of 2022, the market seems to have settled into a consistent 700-900 homes on the market. This new normal is about 1,000 homes short of pre-2020 levels. New listings were down 16% from last year with 603 homes coming on the market in August of 2023 compared to 722 last year. New pending sales were down 12% in August, with 521 pending contracts compared to 591 last year.
Rathbun continues, “Home sellers are exhibiting a degree of caution in the idea of selling their residences due to the desire to retain historically low interest rates they’ve secured over the past decade. This inclination is, in turn, contributing to the limited inventory of available homes. Prospective homebuyers are navigating a landscape that elicits a sense of exhaustion because of the scarcity of options. While the trend of multiple offers persists for freshly-listed homes, the fervor and urgency seen in buyers over the last three years are undergoing a gradual reduction. As the year unfolds, it’s foreseeable that sales prices will maintain their slight upward trajectory due to the scarcity-driven competition, even as buyer activity tapers off as the year draws to a close. The convergence of an early start to the school season, a constrained housing inventory, and the upward movement of interest rates collectively suggest a notable slowing of the market’s momentum as we transition from the vibrant autumn season into the winter months.”
