REALTORS^® in Virginia Continue to Feel Gloomy About the Current Housing Market as Uncertainty Arises.

By Abel Opoku-Adjei
Research Associate, Virginia REALTORS^®

Each month, the Virginia REALTORS^® Confidence Survey gathers important information from REALTORS^® on local housing markets based on their experiences with real estate transactions in the prior month. This data provides a real-time look at housing market conditions. This month’s Confidence Survey was conducted between July 25th and August 1st, 2024, and reflects housing market conditions in Virginia in July 2024. A total of 574 Virginia REALTORS^® members responded to the survey, including 446 who had participated in a home sales transaction in the past month.

Current Market Conditions

Buyers

According to the survey, Virginia REALTORS^® stated that buyer activity decreased in July from a month ago. The Buyer Activity Index was 39 this July, down from 44 in June. Around 17% of REALTORS^® rated the level of buyer activity in their local markets as “high” or “very high” in July, and 38% of REALTORS^® rated buyer activity in their local market as “low” or “very low”.

Approximately 28% of REALTORS^® stated that their most recent transaction in July had a first-time home buyer involved, which is an increase from 26% in June. About 25% of the sales transactions in July were all-cash purchases, according to the survey respondents, reflecting a decline from 27 in June. About 19% of recent home transactions were non-primary residence sales (e.g., rental property, second home, vacation home), down 3 percentage points from the prior month.

Recent transactions received an average of 2.2 offers in July, a slight decline from 2.4 in June. About 39% of respondents in July stated that bids came in above the listing price, which is 10% lower than the previous month.

Sellers

Seller activity remained stagnant from June to July, according to Virginia REALTORS^®. The Seller Activity Index in July, which is unchanged from the prior month. About 11% of REALTORS^® reported that seller activity was “high to very high” in their local market, and 34% of respondents said seller activity was “low to very low.”

Obstacles

Buyers

Demand for housing continues to outweigh the available supply in the market, limiting options for buyers. About 18% of Virginia REALTORS^® stated that rising mortgage rates were holding their buyer clients back from purchasing a home in July, and 36% of Virginia REALTORS^® relayed that the lack of housing in the commonwealth was a major impediment for their clients. A large share of buyer clients faced a mixture of these hurdles in July.

Sellers

According to REALTORS^® in Virginia, roughly 14% of Virginia REALTORS^® stated that their seller clients were unwilling to lose their low-interest rate for a higher rate in the July market, and about 15% confirmed that the lack of housing in Virginia negatively impacted their sellers’ willingness to move. Virtually 14% of REALTORS^® said that rising home prices were stopping seller clients from selling their homes this month because they were worried that they would not get the same type/size of a home elsewhere in their budget.

Pending Sales Activity

According to our recent home sales report, there were 9,068 pending sales in June, 301 more than last year, marking a 3.4% increase. Most pending sales tend to close successfully, but there has been a common trend as to why pending sales have failed to close. In July, 409 REALTORS^® in Virginia stated that one or more of their seller clients had a purchase agreement, and 105 said that the purchase agreement didn’t close as intended.

We asked REALTORS^® what the most common reason was for the pending contract to fall through in July. About 40% of respondents confirmed that the inspection had major issues, which caused the purchase agreement to fail. Roughly 28% stated that the buyer’s mortgage was not approved in time for closing. Nearly 14% said that the buyer’s old home was unable to sell in time for them to finalize the purchase agreement, and 10% of REALTORS^® said that the buyer lost their job or faced financial issues jeopardizing the mortgage approval. Roughly 10% said there were issues within the title which caused the pending sale to collapse.

Reasons For Selling

Results From Virginia REALTORS^® Confidence Survey

We asked Virginia REALTORS^® what was the most common reason their seller clients wanted to sell their homes in July. According to the survey data, 24% of REALTORS^® in Virginia stated that their seller clients were moving out of the state, and 15% of people were looking to relocate somewhere else within Virginia. Around 18% were looking to downsize within the same area they live in, and 13% were looking for a bigger house within the same location. There were about 10% of sellers who were looking to sell their second home in July.

Market Outlook

Confidence in future buyer activity fell for the second consecutive month in July, according to REALTORS^®. This index gauges how REALTORS^® think the market will perform in the following three months. The three-month buyer activity index was 44 in July, a decline from 49 in June. About 17% of respondents indicated that they think buyer activity will be strong in the next three months in their local markets, and 29% stated that they believed buyer activity would drop in the next three months.

The Seller Activity Index: 3-Month Outlook increased from June to July. The Seller Activity Index in July was 39, down three from the prior month. Roughly 11% of Virginia REALTORS® reported that they think seller activity will be strong in three months, and 39% said it would be low.

About 33% of Virginia REALTORS^® responding to the survey stated that prices will rise within the next three months. Nearly 27% of REALTORS^® believe that home prices will decrease between August and October, and 33% of respondents indicated that prices would remain the same. 

Virginia REALTORS^® Confidence Survey: 2024 Highlights

^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 expected 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®. The statistics from this survey have a margin of error of +/- 3.904%.

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 Research & Statistics Team Facebook page.