This year the housing market was different than what was forecasted. A review of Rein’s monthly market reports show that inventory has steadily declined since the beginning of the year which started at the lowest point since 2013. Sales
have remained strong throughout the year with the best months being February and May while July had a large drop year-over-year. The drop in July was not in Hampton Roads alone, in fact the Hampton Roads market has followed the national market with low inventory
and low sales in July. Redfin is attributing the July sales to a month of fewer business days due to five full weekends and a national holiday. New construction has continued to be strong since May with double digit growth and the median sale price has remained
relatively stable since April which had a 4% increase year-to-year. The mild winter may have helped the spring market and May had the lowest state unemployment rate since 2008.
Although the Federal Reserve threatened to raise mortgage rates this year, we have actually seen a decline of approximately 0.5% since January with rates below 4%. Many of the foreign economies are experiencing slow growth which is keeping
our rates low. If China, Japan, and Europe’s economies turnaround, our rates may rise a noticeable level but until that happens, economists don’t expect to see a significant change. We may continue to see rates near 4% for a while.
While the market has remained strong and rates low, the homebuyer market has seen a change in homebuyers. According to NAR, in this past year, 17% of homebuyers were single women, which was twice the rate of single men. Many female buyers
of single family homes are in their 40’s or older and are divorced or widowed. The report also showed that single millennial women are buying condominiums.
This July REIN implemented single sign-on technology to allow easy access to all the necessary transaction tools. You no longer have to recall numerous websites and passwords to process a single transaction. This should speed up and simplify
the transaction process. In October zipLogix Products were replaced by Instanet Solutions to also simplify the transaction process.
Matrix is now the sole MLS system. This decision was made by the product vendor who is no longer going to support the technology behind Fusion. The REIN staff was busy working with the vendor to create reports and functional processes
to make the transition seamless while offering all the tools that we need to run our businesses. Change can be painful for some, but in a world of changing technology and data access it is important that we stay up-to-date to effectively service our clients.
Since this year’s market has been so strong it is believed that it will remain strong into next year. Rates may increase to 4.5% but this should not have an impact on the market. It will still be difficult for first time home buyers to
qualify for a mortgage. If inventories increase, appreciation should slow down and keep prices at an affordable level, allowing many first time home buyers to qualify for a loan.