Key Takeaways: October 2024 Virginia Home Sales Report
November 22, 2024 - Virginia REALTORS®
Welcome 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 November 22nd and November 30th, 2023, and reflects housing market conditions in Virginia in November 2023. A total of 787 Virginia REALTORS® members responded to the survey, including 528 who had participated in a home sales transaction in the last 30 days.
Current Market Conditions
Buyers
According to Virginia REALTORS®, buyer activity remained stagnant in November. The Buyer Activity Index for November was 27, unchanged from October. About 11% of REALTORS® rated the level of buyer activity in their local markets as “high” or “very high” in November, and roughly 57% of REALTORS® rated buyer activity in their local market as “low” or “very low”.
According to survey respondents, virtually 32% of buyers in November were first-time home buyers, which is 3% higher than the previous month. Around 25% of respondents accepted an all-cash purchase in November, a 4% decrease compared to October. Approximately 19% of home sales in November were non-primary residence sales (e.g., rental property, second home, vacation home), 1% higher than last month.
The average number of offers fell slightly from October to November, according to REALTORS® responding to the Confidence Survey. Recent transactions received an average of 1.9 offers in November, a decline from 2 in October. About 32% of respondents in November stated that bids came in above the listing price.
Sellers
Seller activity in November increased compared to October, according to Virginia REALTORS®. The Seller Activity Index in November was 14, four percentage points higher than in October. Roughly 3% of REALTORS® reported that seller activity was “high to very high” in their local market, and 74% of respondents said seller activity was “low to very low.”
Obstacles
As we start to fade out of the fall market, many potential buyers and sellers face similar challenges that hinder them from participating in the housing market. In the survey, we asked Virginia REALTORS® about the main obstacles their clients are facing.
Buyers
In November, around 34% of Virginia REALTORS® emphasized that rising interest rates are their buyer clients’ most significant obstacle. Almost 25% of Virginia REALTORS® stated that the lack of housing inventory in the state was hindering buyers from purchasing a home in the November market. Potential buyers in Virginia seem not to have much of an issue with saving enough for down payments. Roughly 1% of Virginia REALTORS® stated that saving for a down payment was their clients’ most significant concern in November. Most buyers have been able to save up for a home, but high-interest rates and home prices are keeping them on the sidelines.
Thinking about your buyer clients. Which factor is the primary impediment to purchasing in the fall 2023 market?
Sellers
Nearly 19% of Virginia REALTORS® stated that their seller clients were unwilling to lose their low interest rate for a higher rate in the November market. About 11% of Virginia REALTORS® noted that the lack of inventory in their local market is making them reluctant to sell their home in November. In November, roughly 12% of REALTORS® said that rising home prices were stopping sellers from selling their homes because they are anxious that they will not get the same type/size of a home elsewhere in their price range. Many Virginia REALTORS® are facing a combination of these issues, which has stopped them from selling in the November market.
Thinking about your seller clients. Which factor is the primary impediment to selling their home during the fall 2023 market?
Reasons For Selling
Results From Virginia REALTORS® Confidence Survey
There are several reasons why people decide to sell their homes. In November, we asked Virginia REALTORS® what was the most common reason their seller clients wanted to sell their properties in the last 30 days. Out-migration continues to be one of the biggest reasons people sell their homes in Virginia. Roughly 28% of clients wanted to sell their homes because they were moving somewhere outside of the commonwealth. Around 10% of people were looking to relocate somewhere else in Virginia. Almost 17% were looking for a smaller home within the same area they reside in, and 14% were looking for a bigger house within the same locality. Around 8% said their clients aimed to sell their second home/investment property in November.
Are Potential Buyers Struggling with Getting Approved For A Mortgage?
In a recent Consumer Financial Protection Bureau report, lenders denied loan applications more often in 2022 than the year before due to inadequate income. Refinance applications were also rejected more often in 2022 than in the previous year nationwide. Monthly payments rose strongly between 2022 and 2021. In the report, the average cost of a monthly mortgage payment in December 2021 was $1,400 and rose to $2,045 in December 2022, reflecting a 46% increase. The rise of mortgage payments is outpacing income growth across the nation.
This month, we asked our members in the survey if they had noticed any changes in their clients’ mortgage lending process. Approximately 38% of Virginia REALTORS® stated that their clients are facing more difficulties obtaining loan approval than last year, and 42% said they haven’t noticed any changes. Many REALTORS® in Virginia agree that the high-interest rates are dampening their clients’ purchasing power and squeezing them out of the market. For some, their clients are getting approved for a mortgage, but the monthly payments are outside of their financial budget.
Market Outlook
Confidence in buyer activity increased from October to November, says REALTORS® in Virginia. This index gauges how REALTORS® think the market will perform in the following three months. The three-month buyer activity index was 37 in November, up from 26 in October. About 15% of respondents indicated that they thought buyer activity would be strong in the next three months in their local markets, and 39% stated that they believed buyer activity would drop in the next three months.
The Seller Activity Index: 3-Month Outlook increased in November compared to October. The Seller Activity Index in October was 27, a rise from 16 in October. About 6% of Virginia REALTORS® reported that they think seller activity will be strong in three months, and 51% said it would be low.
Virginia REALTORS®, who responded to the survey, believe that home prices will stagnate in the coming months. Around 32% of Virginia REALTORS® responding to the survey stated that they believe prices will decrease within the next three months. Virtually 32% of REALTORS® believe that home prices will increase within the next three months. Approximately 32% of respondents to the survey indicated that prices would remain the same for the next three months.
Virginia REALTORS® Confidence Survey: 2023 Highlights
Key Indicators |
Jan 2023 |
Feb 2023 |
Mar 2023 |
Apr 2023 |
May 2023 |
June 2023 |
July 2023 |
Aug 2023 |
Sep 2023 |
Oct 2023 |
Nov 2023 |
Buyer Activity Indexa | 39 | 56 |
51
|
65 | 63 | 59 | 49 | 39 |
37
|
27 | 27 |
Seller Activity Indexa | 19 | 15 |
15
|
11 | 16 | 14 | 10 | 10 | 14 | 11 |
14
|
Buyer Activity Index: 3-Month Outlookb | 52 | 61 |
52
|
64 | 57 | 57 | 48 | 37 | 36 | 26 |
37
|
Seller Activity Index: 3-Month Outlookb | 37 | 32 |
29
|
25 | 28 | 25 | 20 | 17 | 22 |
16
|
27 |
Current Market Conditions | |||||||||||
First-time Homebuyers, as a Percent of All Sales | 32 | 25 | 36 | 33 | 33 | 32 | 29 | 28 | 29 |
29
|
32 |
Cash Sales, as a Percent of All Sales | 19 | 23 | 21 | 19 | 19 | 21 |
21
|
23 | 26 | 29 | 25 |
Sales as Non-Primary Residence, as a Percent of All Sales | 18 | 20 | 14 | 14 | 15 | 18 |
16
|
17 | 18 | 18 | 19 |
Average Number of Offers, Most Recent Transaction | 1.3 | 2.2 | 3.2 | 4 | 2.6 | 2.7 | 3.2 | 2 |
2.3
|
2 | 1.9 |
Market Outlook | |||||||||||
Percent of Respondents Who Expect Strong Buyer Activity in 3 Months | 28 | 39 | 29 | 42 | 33 | 32 | 25 | 15 |
13
|
10
|
14 |
Percent of Respondents Who Expect Strong Seller Activity in 3 Months |
12 |
10 |
8 |
7 |
8 |
6 |
5 |
6 |
4 |
3
|
6
|
Percent of Respondents Who Expect Prices to Rise in 3 Months | 22 | 37 | 38 | 50 | 46 | 47 | 38 | 36 | 34 | 25 | 32 |
Percent of Respondents Who Expect Prices to Fall in 3 Months | 44 | 31 | 29 |
16
|
16 | 21 | 25 | 25 |
32
|
41 | 32 |
Percent of Respondents Who Expect Prices to Remain Unchanged in 3 Months | 33 | 31 | 30 | 30 | 34 | 28 | 32 | 34 |
30
|
31
|
32 |
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®. The statistics from this survey have a margin of error of +/- 3.49%.
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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