Prices Rise as Inventory Remains Level

Prices Rise as Inventory Remains Level

VIRGINIA BEACH, Va. (June 2023) – Real Estate Information Network (REIN), the leading provider of real estate data in Hampton Roads, has released new numbers showing a significant increase in the median sales price (MSP) of homes sold. The MSP increased by nearly 5% from April to May, reaching a record high of $335,000 for the region.

The previous high MSP for the region was $328,773, which was recorded in May 2022.

Inventory remains tight heading into the summer selling season. Many consumers who might otherwise choose to sell their homes appear unwilling to do so, as both home prices and mortgage rates are higher than they have been in recent years, according to Jon McAchran of AtCoastal Realty and the President of REIN’s Board of Directors.

“The local real estate market remains relatively strong,” McAchran said. “Prices have been steady over the past few months, whereas a number of markets across the nation have seen their selling prices weaken.”

What’s lacking, he said, is enough inventory to meet the needs of potential buyers.

“Even with mortgage rates up and the price of homes higher, people are buying. If there was more inventory, consumers might be more likely to find the home they need, regardless of the price.”

Month’s Supply of Inventory (MSI) is a calculation of how long there would be homes on the market if no new inventory was added. For May, the number was 1.37. Typically, a market is considered “healthy” if the MSI is between 5.0-7.0 months of supply. Since January 2021, the highest the MSI has been was 1.47, which was in July 2021.

“Needless to say, it has been a seller’s market in Hampton Roads for a number of years, and prices are likely to remain high until inventory increases again,” said McAchran.

May data points from REIN:

  • Active residential listings for May were 3,217, up 1.93% from 3,156 in April, but down 6.37% from May 2022.
  • Pending sales stood at 2,856, down 20.86% from 2,363 in April. Pending sales were also down 8.64% year-over-year from May 2022.
  • Settled sales during the month were 2,498, that’s up 5.71% from 2,053 in April, but down 21.69% year-over-year from 3,190 in May 2022.
  • Median sale price (MSP) of homes sold in the region rose to $335,000, up from $320,000 in April and up from the previous record high of $328,773 in May 2022.
  • Month’s Supply of Inventory (MSI) for May was 1.37, up from 1.32 in April and 1.10 in May 2022.
  • Median days on market (DOM) for residential listings was 11, down by one day from 12 in April. In May 2022 the DOM was just eight.
  • Residential new construction sold in the MLS during the month was 252, compared to 277 last month and 263 last year.