Welcome to 2008! I hope everyone had a good holiday and that 2007 was a good year for you! I am looking forward to a good year, as well as a good real estate year, and I wish everyone a prosperous 2008!
As I do each year, I am in the process of gathering the 2007 stats for my real estate market trends, where I compare, by real estate area & county/city, the sales & price activity for Richmond. I plan to have this completed by mid January and will post that to my website then! But I did pull up a very interesting report that was put out by the National Association of Realtors. This was a summary of the housing market for a number of different metropolitan areas, including Richmond. It is a long report, so I don't want to spend a lot of time & space going through the entire report here. However, I did want to let you know about a few things I saw in the report that surprised me a little and did want want to share that with you.
The first thing that struck me was the price activity in the Richmond area. According to this report, Richmond had price appreciation (which is different than what we continually hear on the news). I know that much of what is in this report will vary by real estate area and even by neighborhood, but I did want to let you see how we compared to other metropolitan areas, as well as the overall US average:
1 Yr 3 Yr 3 Yr
Appreciation Appreciation Equity Gain
Richmond 4.2% 36.9% $63,800
Raleigh NC 8.4% 30.5% $52,600
Charlotte NC 8.3% 20.4% $35,100
Washington DC .3% 30.9% $105,200
Hampton Roads 5.7% 61.7% $29,900
Atlanta GA .9% 11.9% $18,700
US Average -1.1% 15.4% $29,900
So in looking at this, you can see that, yes, we did slow our appreciation rate in 2007, but over the past three years, we have had a pretty good appreciation run and sellers who bought homes are still building equity in their homes.
Another thing I found very interesting in this report was the fact that, unlike previous market downturns which were accompanied by severe job cuts, we continue to add jobs. Additionally, apartment rents are rising at the highest pace in 5 years, which will encourage some renters to become home owners. Locally, we added 24,000 net new jobs (August 2007 vs. August 2005), which speaks well for a rise in home sales & a strengthening in home prices. Another thing that has helped our market is a reduction in new home construction over the past year, which helps to prevent prolonged oversupply conditions. The report shows that more new jobs have been added compared to new homes, which bodes well for strengthening home prices.
The report also discusses the mortgage market, which indicated that since 1990 interest rates have trended down and additionally, the fees associated with taking a mortgage out have also fallen. If interest rates continue to remain at the historically low levels we have been seeing, this report published by the National Association of Realtors for the Richmond area seems to indicate that we should see a price growth in the area of around 4.5%. Of course, this is a prediction and you should remember that no one, not even the National Association of Realtors has a crystal ball! However, I feel optimistic about 2008 and our real estate future!
If you would like to see a copy of this report, I will be happy to provide it to you. Please just call or email me and I will send it to you. Have a great 2008!