Here’s some breaking news: For the first time in more than 4 years the region’s real estate market is showing a decline in pending home sales.
According to the most recent sales report from the Real Estate Information Network, September’s residential pending sales are down vs. last year — although only by .29 percent — but still the first year-over-year monthly decrease since May 2014.
REIN’s report showed that last month 2,080 homes went under contract, vs. 2,086 in September 2017.
“This decline, a one-month snapshot at this point, should be viewed in conjunction with two other key indicators in our data,” said John Chandler, president of REIN, a Hampton Roads Local Multiple Listing Service.
One of the metrics, he said, is the Month’s Supply Inventory or MSI, which indicates how many months it would take for the region’s current active listings to sell, given the current rate of home sales.
As an example, if there were 100 active listings and 20 of them sold in September, the MSI would be five months of inventory.
“Our actual month’s supply of inventory during in September went down, year-over-year, from 4.81 months in 2017 to 4.17 months in 2018,” Chandler said, adding that settled sales (sales that have closed) were also down, the first time that has happened in a year.
The number of active listings — homes in the market that are listed for sale — also declined again, for the 38th straight month. Active listings were down just over 8 percent, with 9,688 available homes, compared to 10,549 at the same time last year.
Six of Hampton Road’s seven major cities (Virginia Beach, Norfolk, Chesapeake, Hampton, Portsmouth, and Suffolk) experienced the decline in inventory. Only Newport News saw an increase in homes for sale, with inventory up 3.57 percent over the same time last year.
Portsmouth and Norfolk registered the largest inventory declines at 17.41 percent and 12.94 percent respectively.
“Another key metric we watch is average sales price. This increased in September from $213,000 in 2017 to $235,000 in 2018. Typically, as the market softens, one would expect to the average sales price decline, but it has not in our area,” Chandler said.
Four of the region’s cities recorded year-over-year decreases: Hampton (-11.73 percent); Virginia Beach (-7.72 percent); Chesapeake (-6.95 percent); and Newport News (-2.30 percent).
The only city to significantly buck this trend was Suffolk, which was up 33.93 percent from last September.
“Finally, remember that all real estate data is local,” Chandler said. “National, state, and regional trends are generally indicative of the market at large, but Realtors will assess market data at the city, neighborhood and sometimes even street level. “
He said local agents also look closely at property types and features, as compared to other homes on the market.