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Pending Sales Remain Strong Locally; Down Nationally

Nationally residential pending sales for May 2019 were down 0.7%, “falling on an annualized basis for the fifth consecutive month” according to a report by the National Association of Realtors. The local market for Hampton Roads tells a different story, with residential pending sales for May 2019 rising 7.15% year-over-year, a trend where 59 of the past 60 months exhibited annualized increases (September 2018 was the only month in five years to experience a minor year-over-year decrease of 0.29%). Locally, the real estate market has maintained a consistent pattern for three to five years with declining inventory and steady sales, and June 2019 is no different.

For June 2019, the region’s residential active listings dropped 8.14% year-over-year. This is the 47th consecutive month that active listings have declined year-over-year. Each of the region’s seven major cities (Norfolk, Virginia Beach, Portsmouth, Chesapeake, Suffolk, Hampton and Newport News) experienced a decline in inventory, with Hampton and Newport News undergoing the most significant decreases at 17.17% and 16.17% respectively.

June’s supply of residential home inventory is currently at 3.96 months, down 10.61% from June 2018. This is the 50th consecutive month that the months’ supply of inventory has declined year-over-year. Of the region’s seven major cities, Suffolk and Portsmouth are the only cities with a month’s supply over 4 months, which is still significantly below the six months that is typically considered a balanced market.

Residential pending sales for the region rose 6.78% year-over-year in June 2019, with 2,946 homes going under contract (vs. 2,759 in June 2018). All seven of the region’s major cities experienced a boost in sales, with three cities experiencing double digit gains: Newport News 16.67%, Hampton 13.57% and Norfolk 12.46%. Year-over-year increases for the remaining four cities ranged between 1.83% - 8.99%. 

Though more modest than pending sales, June’s residential settled sales in the region also rose, up 0.48% year-over-year with 2,960 closed units. Hampton and Portsmouth saw gains of 22.7% and 8.38% respectively, while the remaining five major cities underwent declines under 10% each. Residential settled sales for the second quarter of 2019 (April-June) are up 2.1% year-over-year, with Hampton’s sales rising the most at 18.73%. Chesapeake and Newport News were the only major cities for the second quarter to undergo declines at 6.8% and 0.63% respectively.

The area’s residential median sales price for June 2019 was $255,575, up 3.05% from June 2018 when it was $248,000. All seven of the region’s major cities experienced a year-over-year increase in median sales price for June, ranging from 1.58% to 8.63%. The regions’ median sales price for second quarter 2019 (April-June) was $250,000, up 4.17% year-over-year.

The number of distressed homes in the Hampton Roads region, those that are either short sales or foreclosures, has significantly decreased. In June 2019, distressed homes accounted for just 6.47% of all residential settled sales, down 1.42% year-over-year. Though up slightly from the previous month, this is the lowest recording in almost 11 years (since July 2008). Similarly, distressed homes accounted for only 6.72% of all residential active listings in June 2019, down 2.76% year-over-year and the lowest recording since REIN began tracking the data in August 2009.