March Surge Contributes to Significant Growth in First Quarter Residential Market
April 25, 2017
The first quarter of 2017 illustrates another year of significant market strength. With particularly strong sales in March, the first quarter of 2017 outperformed the prior year first quarter by 7.8 percent (rising from 21,213 transactions to 22,859). Likewise, first quarter volume grew year-over-year, from $6.492 billion in 2016 to $7.287 billion in 2017. The 12.2 percent increase in volume resulted from both significant gains in pace and steadily rising median prices. Median price for the first quarter rose 4 percent from 2016 to 2017, from $249,900 to $260,000.
Each month of the first quarter outperformed its prior year benchmark in sales. Annualized pace, the sum of all transactions for the preceding twelve months, rose for the tenth consecutive quarter. Relative to the prior quarter, the annualized measure was up 1.4 percent.
Year-over-year, first quarter home sales increased in all price bands except the lowest, where limited inventory typically restricts market activity. Sales pace and median price increased in every region of the state.
Though 30-year and 15-year fixed mortgage interest rates remain relatively low, they each continued to rise in the first quarter. The Federal Reserve Bank announced a raise in the key rate in March, acting on strong national jobs reports. The average rates for 30-year and 15-year fixed mortgage interest rates in the first quarter were 4.17 percent and 3.39 percent respectively. The prospect of rising rates may continue to spur greater activity in 2017.
According to 2017 Virginia REALTORS® President Claire Forcier-Rowe, “The start of 2017 has underscored the sustained strength of Virginia’s housing market and also illustrated the effects of evolving economic factors. Prices have inclined steadily as eager buyers enter the market and, with greater inventory in March, sales surged with their pent up demand.”
Click here to view the First Quarter Home Sales Report.
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