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Despite Slowing Sales, Virginia Home Prices Keep Rising
Sales activity in Virginia’s housing market moderated in February compared to the same time last year, according to the most recent 2022 Virginia Home Sales Report released by Virginia REALTORS®.
In total, there were 8,160 home sales in Virginia in the last month, down 8.4% from a year ago.
Sales activity has been moderating in the Commonwealth for much of the past six months as the market returns to more seasonal patterns. This moderation is also due, in part, to the low inventory of available homes. At the end of February, there were 12,142 active listings across the state, which is 22.3% lower than the same time last year.
Despite the slowdown in sales, prices continue going up. The statewide median sales price was $350,000 in February. This is $28,550 higher than it was in February of 2021, which is an 8.9% increase—the sharpest gain since June of 2021. On average, homes continue to sell higher than list price in Virginia. The February 2022 average sold-to-list price ratio was 101.4%.
The average sales price in the Williamsburg area footprint was $403,810, rising 11.8% from a year ago, a gain of nearly $43,000. The strongest growth was in Williamsburg at 22% with New Kent County coming in at 21.4% and York County at 13.8%.
The state and regional data was accessed March 15.
Another challenge buyers are facing is the rise in mortgage rates. “I’ve seen some buyers moving a little more cautiously as home prices have continued to climb. However, others are jumping into the market now, before mortgage rates rise any further,” says Virginia REALTORS® 2022 President Denise Ramey. As of the third week in March, the average rate for a 30-year fixed mortgage was 4.16%. This is the first time the average mortgage rate has been above 4% since May of 2019.
Virginia REALTORS® Chief Economist Lisa Sturtevant, PhD says, “Rising mortgage rates will cool demand somewhat, but there are still a lot of buyers in the market. A lack of inventory and high home prices are the biggest challenges in the market right now.”
This information was provided by the Virginia Association of REALTORS® and Williamsburg Area Association of REALTORS®.