The number of first-time homebuyers peaked in March, according to Virginia REALTORS^®

Results from the Virginia REALTORS^® Confidence Survey

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 March 22nd and March 31st, 2023, and reflects housing market conditions in Virginia in March 2023. A total of 511 Virginia REALTORS^® members responded to the survey, including 378 who had participated in a home sales transaction in the last 31 days.

Current Market Conditions

Buyers

According to Virginia REALTORS^®, buyer activity decreased in March. The Buyer Activity Index for the month was 51, a decrease from February, when it was at 56. In March, about 32% of REALTORS^® rated the level of buyer activity in their local markets as “high” or “very high”, and about 30% of REALTORS^® rated buyer activity in their local market as “low” or “very low”.

According to survey respondents, about 36% of buyers in March were first-time home buyers, a 9% increase from February. This is the highest percentage of first-time homebuyers since the start of the survey in 2021. In March, approximately 21% of respondents accepted an all-cash purchase, which is down from 23% in February. About 20% of home sales in March were non-primary residence sales (e.g., rental property, second home, vacation home), 6% fewer than it was in February.

The average number of offers increased from February to March, according to REALTORS^® responding to the Confidence Survey. Recent transactions received an average of 3.2 offers in February, an increase from 2.2 offers on average in February. For the month of March, about 44% of respondents stated that offers came in above the listing price, a small increase from 42% in February.

Sellers

Seller activity remained flat in March, according to Virginia REALTORS^®. In March, the Seller Activity Index was 15, unchanged from February. About 3% of REALTORS^® reported that seller activity was “high to very high” in their local market, down 1% compared to last month. About 73% of respondents reported that seller activity was “low to very low” in March, a slight decrease from February when it was 74%.

Market Outlook

Confidence in future home buyer activity increased in February compared to last month. This index gauges how REALTORS^® think the market will perform in the following three months. This index dropped to 52 in March from 61 in February. About 29% of respondents indicated that they thought buyer activity would be strong in the next three months in their local markets, a decrease from 39% in February.

The Seller Activity Index: 3-Month Outlook inched down in March. The Seller Activity Index in March was 29, a fall from 32 in February. Around 8% of Virginia REALTORS^® reported that they think seller activity will be strong in three months, decreasing by 2% from a month ago.

The share of survey respondents who expect prices to rise in their local markets in the next three months increased in March. About 37% of Virginia REALTORS^® responding to the survey stated that they believe prices will increase within the next three months. Roughly 30% of REALTORS^® believe that home prices will begin to fall within the next three months. Around 31% of respondents to the survey indicated that prices would most likely remain the same for the next three months.

Virginia REALTORS^® Confidence Survey: 2023 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 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 +/- 4.3%.

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.