Region’s Real Estate Market Continues to Slow
VIRGINIA BEACH, Va. (December 2022) – For the first time in years, the number of monthly settled sales and monthly pending sales recorded by the Real Estate Information Network (REIN) dipped below 2,000.
As mortgage rates continue to be higher than they have been in recent years and inflation remains a challenge for consumers, the market continues to slow entering the winter season. Likewise, home prices, which had reached record high median sales prices (MSP) earlier this year, are now falling toward a market correction.
“Home prices are dropping here in our local real estate market, but certainly not at the level they are in some areas of the country,” said REIN Board President Liz Moore of Liz Moore & Associates. “It’s typical for the market to slow as we enter the winter months, so when you factor in the impact of mortgage rates and inflation on consumer spending, it’s kind of a double-whammy.”
Moore said the MSP of homes in the region has dropped about 8% since May. It’s considered a market correction, she said, if the MSP falls by 10% over a 12-month period.
“Affordability is always a concern,” said Moore. “A healthy market benefits everyone.”
November’s data points from REIN:
- Active residential listings totaled 3,863. That’s down by 229 listings month-over-month and up 379 listings year-over-year.
- Pending sales stood at 1,913 for November. That’s down 4.5% month-over-month, but down by a whopping 1,003, or 34.4% year-over-year. According to REIN’s data, the last time pending sales fell below 2,000 for a single month was four years ago in December 2018 (1,687).
- Settled sales during the month were 1,923. That’s down 16.8% month-over-month and is 1,061 fewer than in November 2021 (-35.6%). The last time settled sales dipped below 2,000 was nearly three years ago in February 2020 (1,826).
- The median sales price (MSP) of homes sold across the region in November was $302,000. That’s down from $310,000 in October, but up year-over-year from $295,000 in November 2021.
- The MSI for the month was 1.42. That’s a slight drop from 1.45 the month prior, but year-over-year is well above the MSI of 1.09 recorded in November 2021.
- Median days on market (DOM) for residential listings was 20. That’s a month-over-month increase of one day. The median days on market have increased for seven straight months, and this marks the highest median DOM so far this year.
- Residential new construction sold in the MLS during the month was just 200. That’s down from 244 last month and down 25.4% from 268 last year.