Virginia home sales registered the sharpest decline in more than a decade in the month of November. According to a home sales report released by Virginia REALTORS®, there were 7,681 sales statewide in November – 4,453 fewer than last November, or a 36.7 percent decrease.
In November, there were 6,057 pending sales in Virginia, 3,781 fewer than a year ago, representing a 38.4 percent decrease. Virginia’s pending sales have been slowing down since July 2021.
On average, according to the report, homes are staying on the market longer. Virginia homes that sold in November were on the market an average of 30 days, four days slower than a year ago. As market activity has moderated, it’s taken longer to sell homes, on average, for four consecutive months. This is the first time this has happened since early 2015.
Virginia’s cooldown in sales is predicted to continue into the new year. Fewer buyers are in the market than the same time last year, which is largely a result of reduced purchasing power caused by mortgage rates rising rapidly in 2022 and the upward pressure on home prices.
“In the current economic environment, some buyers and sellers are taking a wait-and-see approach,” said Katrina M. Smith, Virginia REALTORS® 2023 President. “However, other buyers are choosing to take advantage of the decline in competition and the slight uptick in inventory occurring in most markets across the state.”
In total, 63 percent of counties and cities across Virginia had more active listings at the end of November compared to a year ago.
“The decreased confidence in the market on both sides of the table will take some time to overcome,” said Ryan Price, Virginia REALTORS® Chief Economist. “Consequently, sales activity will likely be sluggish in the coming months. Numerous variables, such as inflation, the health of the job market, interest rate trends and consumer confidence will determine how the market moves in 2023.”
Another consideration for the lack of home sales could be a big drop in rent prices in the state. According to the December rent report prepared by Rent.com, Virginia was one of five states that showed year-over-year decreases in November. So while people save up for a down payment or wait for interest rates to fall, renting is an affordable option for potential home buyers.
The four other states with decreases year-over-year in rental rates were Nevada, Maryland, Idaho and Georgia.
Further reading
Click here to view the November 2022 Virginia Home Sales Report.
Click here to view the December 2022 Rent Report.
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Crystal Graham
