Wednesday, April 17, 2024

Home prices in Virginia Beach are going up. Just look at these 1st quarter numbers

VIRGINIA BEACH — The real estate market is often an indicator of the bigger economic picture not only nationwide, but also locally.

Each quarter Southside Daily will take a look at real estate sales across the city, attempt to talk to a local Realtor, and to analyze what the quarterly numbers might mean.

The most recently completed quarter (January-March 2018) saw sales increase 3.15 percent over the same time period last year, with a total of 1,472 sales across Virginia Beach. That number includes sales of any dwelling, such as homes, condominiums, duplexes, and townhomes.

It does not however include businesses.

“Sales have been good relative to available inventory, which is tight,” said Rob Waring, co-owner and principal broker of Beach South Realty in Kempsville. “For the most part anything on the market for more than 90 days has issues that lowering the price won’t overcome, or the pricing is beyond what the comps (typically comparable properties nearby) will support.”

During the most recent quarter the average number of days a home was on the market was 68.

The median sale price of homes in Virginia Beach was $250,000 (versus $245,000 during the same quarter in 2017), while the average sales price was $305,571 ($290,187 in 2017). The median represents the absolute middle sales price in all of the homes sold, while the average takes all of the prices from highest to lowest and mathematically assigns an average sales price.

“Generally, that (an increase in those numbers) is a good thing as long as it doesn’t get out of hand,” he said, noting that a three to five percent annual increase is good, since a buyer can then sell fairly quickly if they need to without losing money.

“That’s particularly important in a market with a high military population that turns over rapidly,” Waring said.

The median list price, which represents the list price of the home or homes that fell in the middle of all the properties listed, rose by 2.04 percent from one year ago.

Tight inventory

Waring said current resale inventory that is listed below $400,000 to $500,000 is limited, and most new construction in single family homes is starting in the high $300,000s, leaving first-time buyers who want new construction the choice of mainly townhomes or condos.

“This (limited resale inventory) forces many first-time home buyers wanting affordable single family homes into the resale market and creates scarcity in that category, pushing the values of entry level homes higher,” he said.

Waring said there are likely two reasons why inventory in the city is tight: First, interest rates are low, encouraging both buyers and Realtors. Second, he suspects many homeowners who were negatively impacted by the housing crisis some 8-10 years ago are now “coming back into the market” and choosing to buy once again.

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