The second quarter Virginia residential real estate market continued its rise over prior year benchmarks according to the Second Quarter 2017 Home Sales Report released by the Virginia REALTORS® association. The number of sales, value of all transactions, median price, and average length of time on the market illustrated notable year-over-year gains, continuing a trend of sustained growth in Virginia’s residential real estate market.
The second quarter of 2017 saw 37,201 residential transactions closed, a 5.3 percent increase over the 35,317 units sold in the second quarter of 2016. The value of those transactions was magnified by a rising median price, and totaled $13.091 billion, an increase of 9.2 percent from 2016’s second quarter volume of $11.986 billion. Relative to the second quarter of 2015, volume rose 20.2 percent (from $10.970 billion).
Annualized residential sales, a rolling sum of the home sales closed in the preceding twelve months, rose for the eleventh consecutive period. Relative to the previous quarter, annualized sales rose 1.6 percent (to 118,738 from 120,622). Serial improvement in annualized sales illustrates sustained growth in the market.
The rise in second quarter 2017 sales pace was spread across the strong performance of each month in the quarter. Historical trends indicate that Virginia home sales peak in June and begin to taper through the remaining summer months into the fourth quarter. Each month of the year so far has outperformed its 2016 benchmark.
The average number of days on the market dropped from prior year benchmarks to an average of 54 for the 2017 second quarter, 14.3 percent lower than last year’s second quarter average (63 days). Expected with industry seasonality, the average length of time on the market declined notably from the first quarter to the second, where June represents the pinnacle of market activity. The year-over-year decrease in days on the market reflects strong buyer motivation, compelled by persistently restricted inventory and sustained urgency to take advantage of relatively low-cost financing.
Virginia’s unemployment rate fell from its first quarter mark to 3.8 percent for the second quarter of 2017. State unemployment continues to outperform the national rate (4.4 percent). The average cost of borrowing remains low, encouraging market entry for buyers in all price brackets. Both 30-year and 15-year averages for fixed mortgage interest rates fell in the second quarter, to 3.99 percent and 3.24 percent, respectively. Despite fluctuation, affordable rates should continue to bolster consumer urgency and contribute to a strongly motivated buyer population as 2017 continues.
Click here to read the Second Quarter Home Sales Report.