Recent forecasts for the Richmond, Virginia housing market suggest that home prices might rise more slowly in the coming months, compared to previous years.
But don’t let that fool you. The real estate market in Richmond, Virginia is hot in 2019. This is largely the result of limited inventory and steady demand, as explained below. These trends could carry over into 2020.
Richmond Housing Market Moving Quickly in 2019
One of the ways to measure the competitive nature or “hotness” of a housing market is by looking at how quickly a typical home sells in the area.
And in Richmond, Virginia, houses are going fast.
According to the national real estate brokerage Redfin, homes sold in Richmond in May 2019 spent a median of just 11 days on the market before going under contract. That was well below the national median number for the same time period. Nationwide, homes listed for sale spent a median of 36 days on the market.
This tells us that the real estate scene in Richmond, Virginia is very active right now. In fact, it’s one of the “fastest” metropolitan-sized housing markets we’ve seen lately. (Of course, anyone who has tried to buy a home in the area recently already knows this. And you can bet the local real estate agents know it as well.)
In summer 2019, Richmond is the kind of housing market where buyers have to compete fiercely for limited inventory. So it’s no surprise to see local agents reporting multiple-offer scenarios, as well as offers above the asking price. Those are common occurrences in a hot real estate market like Richmond.
Starter Homes Especially Hard to Come By
Starter homes, in particular, are hard to come by in the area. Loosely speaking, these are properties priced at or below $250.000. That’s where a lot of first-time buyers tend to shop, so it’s an important segment of the market. And those properties are moving quickly.
According to Laura Lafayette, CEO of the Richmond Association of Realtors:
“Houses under $250,000 aren’t spending any time on the market. There is so little first-time homebuyer inventory. That’s where we’re seeing many examples of multiple offers.”Source: Richmond.com
A separate report published by Realtor.com back in January singled out Richmond as being one of the few housing market in the U.S. where home sales actually accelerated over the previous year.
To quote that report:
“On the flipside, properties sold more quickly than last year in Birmingham, Ala., Milwaukee and Richmond, Va. at 12, 11 and 10 days, respectively.”Source: Realtor.com press release, January 2019
Home buyers should pay close attention to these trends. They should also be prepared to make a strong offer when the right house comes along. It’s probably not the kind of situation where you would want to “low-ball” the seller. There’s just too much competition from other buyers.
Richmond Price Forecast Stretching Into 2020
Recent real estate reports and housing market forecasts for Richmond, Virginia suggest that home-price growth might be slowing in the area. That’s a trend happening in many cities across the country right now, as of mid-summer 2019.
The housing research team at Zillow, for example, recently issued a home-price forecast for the Richmond housing market that predicts smaller gains in the months ahead. By their estimation, house values in the area could rise more slowly between now and the first half of 2020.
In July 2019, the company stated: “Richmond home values have gone up 6.0% over the past year and Zillow predicts they will rise 0.9% within the next year.”
As of July, the median sale price in the area was around $240,000.
The chart below, created by Zillow, shows the median home value for Richmond over the past 10 years or so. As you can see, house prices started to climb in late 2012, following the last recession. They rose even faster throughout 2017 and 2018. Then they slowed a bit. The company’s forecast is shown in the green shaded area. (But that’s just an educated guess.)
Given the current supply-and-demand situation within the Richmond housing market, it’s possible prices could climb at a faster pace than Zillow predicted over the next year or so. Only time will tell.
But it’s the competition factor that really stands out here. With limited inventory, this real estate market is making home buyers hustle.
Summary and Conclusion: Buyers Be Ready
We’ve covered a lot of trends, stats and predictions for the Richmond real estate market within this article. Here’s a recap of the most important takeaways:
- Home prices in and around the city appear to be slowing down.
- At least one forecast predicts slower price growth going into 2020.
- Despite that, the Richmond housing market is hot right now.
- Short supply and strong demand are making things competitive.
- Homes in Richmond are selling much faster than the national average.
Disclaimer: This article includes housing forecasts and predictions from third-parties not associated with the publisher. MetroDepth makes no claims or assertions about future real estate conditions in Richmond, Virginia or elsewhere.