Market Update - September 2018
The national real estate market has rebounded significantly since the "Great Recession", and as a result, home values in Richmond, Virginia have increased nearly to post recession highs. The reasons for the continued recovery are as follows...
- Solid Economic Growth
- A healthy Labor market
- A large milennial population
In addition, there are a number of factors that could create a significant slow down in the postive equity trend that we have experienced in Richmond, Virginia.
- Rising Mortgage Interest Rates
- Unforseen economic circumstances
- Rising National Debt
The fact remains that year-over-year home prices have increased in both the luxury, or high end markets, as well as the lower price range, or first time home buyer markets. The actual numbers in Richmond, Virginia show a year-over-year % change in price of +2.5%. The average year-over-yeaer equity gained per houshould is $6,000 according to core logic. In fact, according to Daren Blomquist from Attomdata, "the number of equity rich homeowners is more than twice the number of seriously underwater homeowners." While it is safe to say that we have recovered from the devestating impact of the recession, we should still pay attention to the fact that mortgage interest rates are rising, and as a result, consumers have lost confidence in terms of mortgage rates being a reason for them to consider buying or selling a home. Furthermore, the national debt continues to rise at a breathtaking pace and that could ultimately produce an "unforseen economic circumstance" that could negatively impact Richmond, Virginia home prices. Only time with tell with regard to the latter point, but I have to believe that our out of control debt will eventually catch up with us. For now, the lack of inventory, healthy labor market, consumer confidence index, and a large millenial buying population, should continue to drive prices up overall for Richmond, VA home owners for the rest of 2018 as well as 2019. There are certainly seasonal flucuations in demand in Richmond and the surrounding counties, which makes this time of year a better time to buy and arguably a worse time to sell.
If you or anyone you know is thinking about buying or selling a home and simply wants to have a conversation about whether or not now is a good time? Feel free to give us a call or drop us an email.
- Clayton Gits . Owner . Mission Realty brokered by eXp