Even as leading economic indicators (and consumer confidence) bobs and weaves on an almost day-to-day basis, the Virginia real-estate market continues to take the COVID-19 pandemic in stride.
“Pent-up demand was unleashed on the market as home-sales activity rebounded strongly in July,” said Lisa Sturtevant, chief economist for the Virginia Realtors’ trade group, in an analysis of monthly sales figures.
The data back up her assessment: Home sales statewide totaled 14,581 in July, up 13.2 percent from a year before and (in one of many unusual twists in this unusual year) rising nearly 11 percent from a month before – something that almost never happens from June to July in the Virginia homes market.
Year-over-year sales were up in every corridor of the commonwealth, in most cases by double-digit amounts. In Northern Virginia, the 5,242 transactions recorded in July represented a bump of 11 percent from a year before, although the year-to-date sales of 25,959 remain 6.1 percent below 2019 due to the spring market largely being lost to COVID fallout.
Virginia’s second-largest homes corridor, Hampton Roads, saw a year-over-year bump of 20.3 percent in July to 3,608, while the third biggest, central Virginia (with Richmond at its center) saw 6-percent boost to 3,001.
Hampton Roads and four Virginia corridors in less urban environments – west-central Virginia, Eastern Virginia, Southwest Virginia and Southside Virginia – closed out the first seven months of the year with more closed transactions than at the same period in 2019, despite the flaccid spring market. The Shenandoah Valley on roughly on par with 2019 (down eight sales, or 0.2 percent) while Central Virginia was down just 1.3 percent.
Median sales prices, which were never derailed event at the depths of the COVID lockdown, hit $332,000 in July, up $23,000 (7.4 percent) from a year before. Sellers, on average, were getting 99.5 percent of listing price, although in Northern Virginia and the Richmond area, the sales price was more than 100 percent of listing price.
Median sales prices were up in all corridors, ranging from $130,000 in Southside Virginia to $513,677 in Northern Virginia.
July also brought a resurgence in the upper end of the market, which had been somewhat stagnant in May and June as both sellers and buyers stayed on the sidelines.
Statewide, 7.1 percent of homes sold in July were priced at $800,000 or more, compared to 5.1 percent a year before, while homes at $1 million and above represented 3.2 percent of all statewide sales, compared to 2.5 percent.
(By contrast, rising prices are causing problems at lower price points. In July, 43.5 percent of homes sold statewide were for $300,000 or less, down from 48.9 percent a year before. “Even with historically low mortgage rates, affordability is once again becoming a challenge in many local markets,” Sturtevant said, pointing to a lack of supply as a key problem.)
While Virginia – buoyed by the federal government, which has seen increased employment since the pandemic began – is surviving the situation better than most, there remain headwinds, Sturtevant said.
Despite recent improvement in the jobs picture, “the Virginia economy has 306,000 fewer jobs that it did a year ago,” she said. “The economic recovery will likely be slow, with potential starts and stops in the third and fourth quarters.”