Nearly nine in 10 Virginia counties and cities across the commonwealth posted declines in home sales from 2022 to 2023 while prices continued to rise, and those in the industry have hopes that the inventory logjam is beginning to ease.
A total of 98,464 properties changed hands across the Old Dominion in 2023, according to figures reported Jan. 23 by the Virginia Realtors trade group. That’s a drop of 24,780 homes, or 20 percent, from 2022.
The sales total was the lowest recorded in Virginia since 2014, but was not accompanied by a drop in prices. In fact, the median sales price of $390,000 in 2023 was up $15,000, or 4 percent, from a year before.
The market’s forward momentum will be aided by stable, lower mortgage-interest rates. If that materializes, it could not just spur activity not just on the buyer side, but among homeowners who so far have refused to give up rock-bottom-rate mortgages obtained during the early days of the pandemic.
“If rates continue trending downward, it will likely spur housing market activity on both sides of the table, as there is pent-up demand from both first-time buyers and those looking to move up,” said Tom Campbell, president of the trade group.
But it’s not suddenly going to be a buyers’ market awash in availability.
“While there will likely be some gains in inventory, the overall supply will continue to be tight, and the market will remain competitive,” said Ryan Price, chief economist for Virginia Realtors.
Closing out 2023, there were 6,929 sales statewide in December, 563 fewer than a year ago, reflecting a 7.5-percent drop. The year-over-year decrease in sales has been getting smaller and smaller each month, signaling that the market likely is approaching the bottom of the slowdown.
The December statewide median sales price was $382,725, up 6.6 percent from a year before. Virginia’s median sales price rose 11 out of 12 months in 2023, and the price growth accelerated in the second half of the year even as mortgage rates were approaching 8 percent.
(The December median sales price being lower than the full-year median price is typical, as sales prices tend to be lower during slower seasons.)
In December 2023, the total sales volume of $3.3 billion was down a fraction of a percent from a year before, the smallest dropoff since the spring of 2022 and reflecting both the increasing price appreciation and the modest improvement in sales activity.
Sales volume for 2023 as a whole stood at $47.4 billion, down from $60 billion a year before.
Figures represent most, but not all, homes on the market. All December 2023 figures are preliminary and are subject to revision.
