#26 Buyers are Active, Sellers Remain on the Sidelines: Results from the Virginia REALTORS® Confidence Survey

By Lisa Sturtevant, PhD
Chief Economist, Virginia REALTORS®

The Virginia REALTORS® Confidence Survey gathers information from REALTORS® on local housing markets based on their experiences with real estate transactions in the prior month. This month’s Confidence Survey was conducted between December 29, 2021 and January 2, 2022, and reflects housing market conditions in Virginia in December 2021. A total of 732 Virginia REALTORS® members responded to the survey, including 590 who had participated in a home sales transaction in the prior 30 days.

Virginia REALTORS® Confidence Survey: Highlights

Key Indicators July 2021

Aug

2021

 Sep 2021

Oct

2021

 Nov 2021 Dec 2021
Buyer Activity Indexa 77 68 66 66 66 64
Seller Activity Indexa 41 38 35 36 30 24
Buyer Activity Index: 3-Month Outlookb 68 63 59 58 72 78
Seller Activity Index: 3-Month Outlookb 50 47 42 41 49 50
Current Market Conditions            
First-time Homebuyers, as a Percent of All Sales 31 33 32 29 33 31
Cash Sales, as a Percent of All Sales 16 18 20 18 18 19
Sales as Non-Primary Residence, as a Percent of All Sales 16 16 16 16 17 18
Average Number of Offers, Most Recent Transaction 3.5 3.2 3.1 2.4 2.9 3.0
Market Outlook            
Percent of Respondents Who Expect Strong Buyer Activity in 3 Months 44 35 28 29 50 60
Percent of Respondents Who Expect Strong Seller Activity in 3 Months 24 16 11 12 22 25
Percent of Respondents Who Expect Prices to Rise in 3 Months 50 44 37 42 49 59
Percent of Respondents Who Expect Prices to Fall in 3 Months 20 24 27 27 17 11
Percent of Respondents Who Expect Prices to Remain Unchanged in 3 Months 27 29 35 31 31 27

a An index greater than 50 indicates more respondents reported the level of activity as “high to very high” than reported the level of activity as “low to very low.”

b An index greater than 50 indicates more respondents expect future activity to be “strong” than expect future activity to be “weak”.

Current Market Conditions

Buyers

The Virginia REALTORS® Buyer Activity Index has remained fairly steady over the past six months. In December, the Buyer Activity index was 64, down slightly from the prior three months where it was at 66. About 43% of REALTORS® rated the level of buyer activity in their local market as “high to very high” in December, the same share as in October and November. There was a slight uptick in the share of REALTORS® who said the level of buyer activity was “low or very low”—14% in December compared to 10% in November. About 41% reported that the level of buyer activity in the market was “average” in December.

According to survey respondents, 31% of buyers in December were first-time buyers. This share has been fairly steady over the past six months, according to Virginia REALTORS® responding to the REALTORS® Confidence Survey. About 19% of purchases in December were all-cash purchases and 18% of buyers purchased a home for a non-primary residence use (e.g., rental property, second home, vacation home).

Sellers

According to Virginia REALTORS®, seller activity in the state continues to decline. The Seller Activity Index was 24 in December, down from 30 in November and 36 in October. Only 8% of respondents reported that seller activity was “high to very high” in their local market, the lowest in six months. More than three in five REALTORS® (62%) reported that seller activity was “low to very low”, which is up significantly from November (52%) and October (43%).

Market Outlook

In this month’s REALTOR® Confidence Survey, Virginia REALTORS® are feeling confident about where the market is headed, perhaps anticipating a strong spring market. The outlook for buyer activity hit a six-month high and the outlook for seller activity matched the high reported in July.

The Buyer Activity Index: 3-Month Outlook was 78 in December, up six points from November, and higher than at any point since the survey began in July. About 60% REALTORS® responding to the survey indicated that they thought buyer activity would be strong in their local market in three months.

The Seller Activity Index: 3-Month Outlook was 50 in December, up one point from November. REALTORS® remain more cautious about the level of seller activity in upcoming months, though there is some improvement in the future seller activity index. About one in four (25%) Virginia REALTORS® reported that they think seller activity will be strong in three months, which is up from 22% last month. However, a similar share (25%) of respondents report they expect seller activity to be weak in three months.

Outlook for the Housing Market

Survey respondents remain very optimistic about price growth.  About 59% of Virginia REALTORS® responding to the survey expect prices will rise in their local markets, which is up from 49% in November. Fewer REALTORS® say they expect prices to fall. Only 11% of REALTORS® responding to the December survey stated that they thought prices would fall over the next three months. This share has been declining since September.

A note about surveys: This is not a randomized sample survey of Virginia REALTORS® members. However, the number of responses and the geographic coverage of respondents make it possible to draw conclusions about the opinions and expectations of Virginia REALTORS®. These statistics from this survey have a margin of error of +/- 3.5%.

Responses to our surveys are confidential. We do not look at individual responses but rather report data in the aggregate.

For more information about Virginia’s housing market, check out our most recent home sales report, local housing market data, or Facebook Live.

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