November 21, 2022 - Robin Spensieri
By Abel Opoku-Adjei
Research Associate, Virginia REALTORS®
Each month, the Virginia REALTORS® Confidence Survey gathers insights from REALTORS® on local housing markets based on their experiences with real estate transactions in the prior month. This information provides a real-time look at housing market conditions. This month’s Confidence Survey was conducted between October 24th and November 1st, 2022, and reflects housing market conditions in Virginia in October 2022. A total of 799 Virginia REALTORS® members responded to the survey, including 604 who had participated in a home sales transaction in the prior 31 days.
Current Market Conditions
According to Virginia REALTORS®, buyer activity declined in October. The Buyer Activity index for the month was 23, which is down from 29 in September, the lowest level since the REALTOR® Confidence Survey launched in July 2021. About 6% of REALTORS® rated the level of buyer activity in their local markets as “high” or “very high”, and about 60% of REALTORS® rated buyer activity in their local market as “low” or “very low”.
Around 24% of buyers in October were first-time buyers, according to survey respondents, which is the lowest so far this year. In October, about 21% of respondents accepted an all-cash purchase, up from 19% in September. This month, there were about 20% non-primary residence sales (e.g., rental property, second home, vacation home), an increase of 2% from the previous month.
The average number of offers increased as sellers received more offers compared to September, according to REALTORS® responding to this month’s survey. Recent transactions received an average of 1.8 offers in October, a slight increase from 1.7 offers on average in September, but down from 2.4 offers on average from October 2021. During the month of October, about 29% of respondents stated that offers came in above the listing price, down from 32% in September.
Seller activity declined in October, according to Virginia REALTORS®. In October, the Seller Activity Index was 21, a fall from 27 in September. About 3% of respondents reported that seller activity was “high to very high” in their local market, down 2% compared to last month. About 60% of REALTORS® reported that seller activity was “low to very low,” an increase from last month when it was 52%.
Confidence in future home buyer activity declined compared to last month. This index gauges how REALTORS® think the market will be performing in three months’ time. The index decreased to 22, down from 25 in September, the lowest since the REALTOR® Confidence Survey kicked off in July 2021. Remaining unchanged from last month, about 6% of respondents indicated that they thought buyer activity would be strong in the next three months in their local markets.
The Seller Activity Index: 3-Month Outlook declined in October. The index dropped slightly this month to 26. Only 3% of Virginia REALTORS® reported that they think seller activity will be strong in three months, down from 6% in September.
The share of survey respondents who expect prices to rise in their local markets in the next three months dropped again compared to last month. About 72% of Virginia REALTORS® responding to the survey stated that they believed prices will drop within the next few months. Roughly 20% of REALTORS® responding to the survey indicated that prices would remain the same for the next three months.
Virginia REALTORS® Confidence Survey: 2022 Highlights
|Sep 2022||Oct 2022|
|Buyer Activity Indexa||76||78||84||71||56||48||43||39||29||23|
|Seller Activity Indexa||20||19||20||26||33||31||33||29||27||21|
|Buyer Activity Index: 3-Month Outlookb||83||77||75||61||45||39||41||42||25||22|
|Seller Activity Index: 3-Month Outlookb||43||40||40||41||42||42||40||39||30||26|
|Current Market Conditions|
|First-time Homebuyers, as a Percent of All Sales||29||32||33||30||30||27||29||28||32||24|
|Cash Sales, as a Percent of All Sales||18||18||18||21||16||16||19||22||19||21|
|Sales as Non-Primary Residence, as a Percent of All Sales||21||14||16||19||15||15||17||18||18||20|
|Average Number of Offers, Most Recent Transaction||4.1||6.3||6.6||5.3||2.9||3.1||1.8||1.7||1.7||1.8|
|Percent of Respondents Who Expect Strong Buyer Activity in 3 Months||70||63||59||36||18||13||11||12||6||6|
|Percent of Respondents Who Expect Strong Seller Activity in 3 Months||19||20||18||16||14||12||9||9||6||3|
|Percent of Respondents Who Expect Prices to Rise in 3 Months||64||69||68||43||32||19||18||14||9||7|
|Percent of Respondents Who Expect Prices to Fall in 3 Months||7||8||10||25||33||49||53||51||66||72|
|Percent of Respondents Who Expect Prices to Remain Unchanged in 3 Months||26||21||18||28||32||30||26||30||23||20|
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”.
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 +/- 3.4%.
Responses to our surveys are confidential. We do not look at individual responses but rather report data in the aggregate.
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