As summer temperatures begin to drop, you may be wondering if the seller’s market will cool off too. Summer 2021 was a hot season for selling in Virginia, with much of the market bouncing back from the low inventory that COVID-19 compounded. Buyers saw benefits as well, with interest rates hitting record lows. Although housing inventory remains limited, this summer showed promising signs of expansion. Now that summer is nearing the end, here are some key trend takeaways from the summer real estate market in Virginia that can give us an idea of what to expect in the fall.
Housing Inventory Expanded All Summer.
According to the July 2021 Home Sales Report released by Virginia REALTORS®, Virginia’s home inventory expanded for the fifth consecutive month. This means buyers have more options, reflecting a significant change from the inventory shortage that sent buyers into bidding wars earlier in the year. The Home Sales Report found that 17,732 new listings came onto the market in Virginia in July — that’s 10% higher than last July. Due to the increase in new listings, there were 20,910 active listings at the end of July — that’s about 1,500 more than at the end of June, an increase of more than 8%.
Homes are Still Selling Fast.
The seller’s market is still going strong in Virginia. According to the report, in July 2021, homes that sold were on the market for about 20 days—half the time it took homes to sell last year. In July, the average price of a home sale statewide was $361,000—an increase of 8% since last year. Although prices are still climbing, July’s increase reflects a slight slowdown in price growth after the median price statewide rose at a double-digit rate for 11 of the past 12 months!
So, it’s safe to say the current market conditions remain strong. In fact, nearly 60% of respondents to the Virginia REALTORS® Confidence Survey rated the level of buyer activity in their market as “high to very high,” compared to only 5.6% who rated it as “low to very low.”
What Will Market Activity Look Like in the Fall?
Most respondents of the REALTORS® Confidence Survey reported that they expect buyer activity to cool off slightly and seller activity to pick up as we head into the fall. Here are some key takeaways from the survey:
- Around 44% of respondents indicated they thought buyer activity would remain strong in their markets through the fall.
- 43% expect buyer activity to remain stable.
- 7.5% reported they expect buyer activity in their market to be weak into the fall.
- About half of respondents expect prices to increase in the next three months, whereas about 20% expect prices to fall in their market.
- Nearly 24% of respondents reported they expect seller activity will stay strong in the next three months.
- 46% expect seller activity to be stable.
- Nearly 23% expect it to weaken in October.
Some realtors are expecting prices to fall in their local markets:
- About 12.7% of survey respondents said they think prices will fall by between one and five percent.
- 7.3% expect prices in their market to fall by six percent or more.
From this data, we can only estimate that the transition to autumn won’t bring too many changes to the real estate market—but we may start to see it cool down slowly with the weather!