Virginia · Virginia. For example, the economic region defined as Northern Virginia encompasses more counties ... Chesapeake, Franklin, Hampton, Newport News, Norfolk, ... Q3 2014

VirginiaHOME SALESREPORTQ4 2016

Published by the Virginia REALTORS®, the advocate for real estate professionals and property owners in Virginia.

2016 Fourth Quarter

Published by the Virginia REALTORS®

Data recorded January 12, 2016 1

The Virginia REALTORS® association publishes monthly and quarterly home sales reports to provide

our members, the media, and real estate‐related industries with current data. The report data

comes from a variety of sources and is analyzed by the Virginia REALTORS®. All data may be used

with citation to the proprietary owner, the Virginia REALTORS®.

The data presented is based on specific economic regions comprised of counties and independent

cities in Virginia, as detailed in the map below. It should be noted that these regions do not

necessarily align with the counties and cities that comprise the 28 local REALTOR® associations in

Virginia. For example, the economic region defined as Northern Virginia encompasses more

counties and cities than those within the bounds of the Northern Virginia Association of REALTORS®

(NVAR). Please take this into consideration when referencing regions.

Central Albemarle, Amelia, Buckingham, Caroline, Charles City, Chesterfield, Culpeper, Cumberland, Dinwiddie, Fluvanna, Goochland, Greene, Hanover, Henrico, King & Queen, King William, Louisa, Madison, Nelson, New Kent, Orange, Powhatan, Prince George, Rappahannock, Sussex; Charlottesville, Colonial Heights, Hopewell, Petersburg, Richmond

Eastern Accomack, Essex, King George, Lancaster, Middlesex, Northampton, Northumberland, Richmond, Westmoreland

Hampton Roads Gloucester, Isle of Wight, James City, Mathews, Surry, York; Chesapeake, Franklin, Hampton, Newport News, Norfolk, Poquoson, Portsmouth, Suffolk, Virginia Beach, Williamsburg

Northern Arlington, Clarke, Fairfax, Fauquier, Loudoun, Prince William, Spotsylvania, Stafford, Warren; Alexandria, Fairfax, Falls Church, Fredericksburg, Manassas, Manassas Park

Southside Brunswick, Charlotte, Greensville, Halifax, Henry, Lunenburg, Mecklenburg, Nottoway, Patrick, Pittsylvania, Prince Edward, Southampton; Danville, Emporia, Martinsville

Southwest Bland, Buchanan, Carroll, Dickenson, Floyd, Grayson, Lee, Russell, Scott, Smyth, Tazewell, Washington, Wise, Wythe; Bristol, Galax, Norton

Valley Alleghany, Augusta, Bath, Frederick, Highland, Page, Rockbridge, Rockingham, Shenandoah; Buena Vista, Covington, Harrisonburg, Lexington, Staunton, Waynesboro, Winchester

West Central Amherst, Appomattox, Bedford, Botetourt, Campbell, Craig, Franklin, Giles, Montgomery, Pulaski, Roanoke; Lynchburg, Radford, Roanoke, Salem

2016 Fourth Quarter



Fourth Quarter and Year End Market Summary

The fourth quarter of 2016 contributed to a year of significant market strength. With

particularly strong sales in November, following consumer reaction to the conclusion of the

Federal election cycle and the anticipation of rising rates, sales in the fourth quarter of 2016

outperformed the prior year fourth quarter by 6.8 percent (from 24,639 transactions to

26,308). Likewise, fourth quarter volume grew year‐over‐year, from $7.830 billion in 2015 to

$8.527 billion in 2016. The 8.9 percent increase in volume resulted from the boost in sales

numbers, magnified by rising median prices. Statewide, median price for the fourth quarter

rose 3.9 percent from 2015 to 2016, from $255,175 to $265,000.

The value of transactions for all of 2016 exceeded $37.916 billion, up 8 percent from the

accumulated volume in 2015 ($35.095 billion). Despite mid‐year inventory constraints, every

quarter of 2016 outperformed prior year benchmarks. The strongest relative gains occurred

in the second quarter, with the aggregate of sales for April, May, and June rising 10.7 percent

higher than for the same months in 2015. Pace for the year rose 6.6 percent, with 116, 091

transactions in 2016, over 108,870 in 2015.

Year‐over‐year, fourth quarter home sales increased in all price bands except the lowest ($0

to $100,000), where limited inventory typically restricts market activity. The most significant

increase in market activity was in the $300,000 to $500,oo0 price range, with 13.1 percent

more transactions in that range than in the fourth quarter of 2015.

Sales increased in every region of the state in the fourth quarter. Median price rose regionally

for the quarter everywhere except in the Southwest, where there was a moderate decline.

Though 30‐year and 15‐year fixed mortgage interest rates remain at enticing lows, they each

jumped notably from October to November and again from November to December.

Responding to the Federal Reserve Bank’s decision to raise the key rate in December,

average rates for 30‐year and 15‐year fixed mortgage interest rates in the fourth quarter rose

to 3.81 percent and 3.07 percent, respectively. Effectively, the cost of borrowing rose in the

fourth quarter by an average of 10.6 percent and 11.6 percent for 30‐year and 15‐year fixed

mortgages, respectively. Rising but accessible rates may contribute to greater activity in 2017

as buyers react with urgency.

2016 Fourth Quarter



Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec

2013 5,647 6,022 7,555 8,739 10,582 10,872 10,456 10,234 8,243 7,995 6,989 7,606

2014 5,427 5,705 7,150 8,507 9,701 10,633 10,176 9,486 8,360 8,448 6,662 8,306

2015 5,807 6,086 8,521 9,170 10,369 12,684 11,821 10,205 9,568 8,871 7,020 8,748

2016 5,943 6,561 8,672 10,202 11,772 13,274 11,509 11,754 10,096 8,953 8,504 8,851

Each month of the fourth quarter in 2016 had higher sales than in the corresponding months of the

previous year. November 2016 sales increased especially, rising more than 21 percent year‐over‐

year, from 7,020 in 2015 to 8,504 in 2016. Whereas pace usually declines markedly in the middle of

the fourth quarter, November 2016’s buoyancy contributed to a quarter that outperformed the end

of 2015 by 6.8 percent. Still reflecting industry seasonality, the 2016 fourth quarter pace declined

from the third quarter pace by 21.1 percent. The seasonal taper through the end of 2016 was on par

with 2015’s, when sales declined 22 percent from the third quarter to the fourth.

5,943 6,561

8,672

10,202

11,772

13,274

11,509 11,754

10,096

8,953 8,504

8,851

2,500

5,000

7,500

10,000

12,500

15,000

Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec

Number of Single Family, Townhome, and Condo Sales

Month‐to‐Month Sales TrendsSingle Family Homes, Townhomes, Condos

2013 2014 2015 2016

2016 Fourth Quarter



Sales in the fourth quarter of 2016 grew by 6.8 percent year‐over‐year, from a total of 24,639 in 2015

Q4 to 26,308. Relative to the fourth quarter of 2014, fourth quarter sales for 2016 rose 12.4 percent.

Further indicated through the annualized sales trend (page 5), year‐over‐year improvements in

quarterly performance indicate sustained market expansion.

Note: the horizontal bar in the graph indicates the variance in fourth quarter sales from 2013

through 2016, beginning with 22,590 sales in 2013 and rising eventually to 26,308 sales in 2016, with

graduated increases for each year in between. 2016 fourth quarter sales were 16.5 percent higher

than their 2013 benchmark.

15,000

20,000

25,000

30,000

35,000

40,000

2013Q1

2013Q2

2013Q3

2013Q4

2014Q1

2014Q2

2014Q3

2014Q4

2015Q1

2015Q2

2015Q3

2015Q4

2016Q1

2016Q2

2016Q3

2016Q4

Number of Single Fam

ily, Townhome, C

ondo Sales

Quarterly Residential SalesSingle Family Homes, Townhomes, Condos

6.8 %

2016 Fourth Quarter



Each data point on the graph above represents twelve months of home sales data ending in the

quarter shown. For example, the 2016 Q4 figure (116,091 sales) includes home sales from January

2016 through December 2016, and the 2016 Q4 figure (114,422 sales) includes home sales from

October 2015 through September 2016. This rolling sum of home sales reduces seasonal effect,

providing a clearer indicator of long‐term trends in Virginia’s housing market. The trend of

continued improvement in this measure illustrates how Virginia’s residential real estate market has

grown consistently over the long‐term. Annualized sales ending in the fourth quarter of 2016 grew

1.5 percent from the previous quarter. Year‐over‐year, the measure grew 6.6 percent.

Indicating that growth has been sustained regardless of seasonal market fluctuations, annualized

sales have grown for nine consecutive quarters. The average growth per quarter over that time

period has been 1.9 percent. This suggests that, if remaining on trend, the annualized sales figure

ending in the first quarter of 2017 may approach 118,000 sales.

70,000

75,000

80,000

85,000

90,000

95,000

100,000

105,000

110,000

115,000

120,000

2013Q4

2014Q1

2014Q2

2014Q3

2014Q4

2015Q1

2015Q2

2015Q3

2015Q4

2016Q1

2016Q2

2016Q3

2016Q4

Number of Single Family, Townhome, and Condo Sales

Annualized Residential Sales Single Family Homes, Townhomes, Condos

6.6 %

2016 Fourth Quarter



Region 2015 Q4 2016 Q4

Central 5,296 5,690 7.4%

Eastern 488 555 13.7%

Hampton Roads 5,525 5,962 7.9%

Northern 9,016 9,598 6.5%

Southside 493 540 9.5%

Southwest 420 486 15.7%

Valley 1,420 1,431 0.8%

West Central 1,970 2,035 3.3%

Other 11 11 0%

ALL of Virginia 24,639 26,308 6.8%

The chart above compares 2015 fourth quarter sales to 2016 fourth quarter sales, by region. All

regions experienced growth from the same period last year, for a statewide aggregate jump of 6.8

percent. The greatest year‐over‐year percentage increases occurred in the Eastern and Southwest

regions. Performance metrics are relative to the absolute number of sales, so less dense regions

with increasing sales may show a relatively higher growth percentage. The densest regions –

Northern, Central, and Hampton Roads – all gained notably as well.

Regional Changes in Sales 2015 Q4 vs. 2016 Q4 Units

+15.7 %

+7.4 %

+3.3 %

+6.5 %

+9.5 %+7.9 %

13.7 %+0.8 %

2016 Fourth Quarter



In comparison to the fourth quarter of 2015, aggregate median price rose by 3.9 percent for the

fourth quarter of 2016. Relative to the fourth quarter of 2014, median price rose by 5.6 percent.

Price rises have been spurred by increased buyer confidence, with demand exceeding supply.

Reflecting typical seasonal trends, median price fell relative to the third quarter of 2016 by 2.2

percent, from $271,000 to $265,000. A decline in price from the third to fourth quarters is expected

as the industry seasonality is more pronounced in winter months.

$232,500

$268,242

$263,520

$249,000

$235,000

$267,000

$260,000

$251,000

$247,525 $274,950

$265,000

$255,175

$249,900 $279,000

$271,000

$265,000

$150,000

$200,000

$250,000

$300,000

$350,000

2013Q1

2013Q2

2013Q3

2013Q4

2014Q1

2014Q2

2014Q3

2014Q4

2015Q1

2015Q2

2015Q3

2015Q4

2016Q1

2016Q2

2016Q3

2016Q4

Med

ian Price

Median Residential Sales PriceSingle Family Homes, Townhomes, Condos

5.6 %

3.9 %

2016 Fourth Quarter



Region 2015 Q4 2016 Q4

Central 220,000 229,500 4.5%

Eastern 205,000 210,000 2.4%

Hampton Roads 219,000 227,500 3.9%

Northern 396,000 400,000 1.0%

Southside 89,900 95,750 6.5%

Southwest 119,700 117,950 ‐1.5%

Valley 180,000 195,000 8.3%

West Central 160,750 166,500 3.6%

Other 80,000 78,500 ‐1.9%

ALL of Virginia $255,175 $265,000 3.9%

Median sales price increased year‐over‐year in every region except the Southwest. There were

particularly strong price gains in the Southside and Valley regions.

Regional Changes in Median Sales Price 2015 Q4 vs. 2016 Q4

+6.5 %

+3.6 %

‐1.5 %

+4.5 %

+8.3 %

1.0%

+3.9 %

+2.4 %

2016 Fourth Quarter



This graph represents the dollar value of residential real estate sold (in billions) during each quarter

for the last four years. The volume of real estate sold in the fourth quarter of 2016 rose by 8.9

percent year‐0ver‐year, from $7.830 billion to $8.527 billion. Volume is amplified year‐over‐year by

increases in both price and the number of transactions.

$0

$2

$4

$6

$8

$10

$12

$14

2013Q1

2013Q2

2013Q3

2013Q4

2014Q1

2014Q2

2014Q3

2014Q4

2015Q1

2015Q2

2015Q3

2015Q4

2016Q1

2016Q2

2016Q3

2016Q4

Billions of dollars of resien

tial sales

Quarterly Residential Sales Volume ($B)Single Family Homes, Townhomes, Condos

8.9 %

2016 Fourth Quarter



Annual volume for 2016 rose 8 percent year‐over‐year to $37.916 billion, over $35.095 billion for all

of 2015. 2016 annual volume was 20.7 percent higher than for 2014 ($31.425 billion). This chart

indicates clearly that for each quarter of 2016, volume exceeded performance for the

corresponding quarter in 2015, just as each quarter of 2015 exceeded the benchmarks of 2014. The

continued improvement over prior year quarterly comparisons illustrates sustained growth and

market strength.

$5.580 $5.410 $6.247 $6.475

$9.964 $9.553$10.789 $11.941

$9.334 $9.056

$10.228$10.973

$6.958 $7.405

$7.830

$8.527

$0

$5

$10

$15

$20

$25

$30

$35

$40

2013 2014 2015 2016

Billions

Annual Sales Volume by QuarterSingle Family Homes, Townhomes, Condos

Q1 Q2 Q3 Q4

$31.425

8.0 %

$34.095

$37.916

2016 Fourth Quarter



Year‐0ver‐year home sales increased in every price category except the lowest ($0 to $100K), where

restricted inventory limits the number of sales possible. Growth was particularly strong in the

ranges from $300k to $500k.

2,370

6,268

6,669

4,367

2,622

2,790

717

505

2,473

6,269

5,988

3,878

2,301

2,583

694

453

0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000

0 ‐ $100K

$100K ‐ $200K

$200K ‐ $300K

$300K ‐ $400K

$400K ‐ $500K

$500K ‐ $750K

$750 K ‐ $1M

$1 M+

Price Ran

ge

Price Distribution of Residential Home SalesSingle Family Homes, Townhomes, Condos

2015‐Q4 2016‐Q4

NO CHANGE

9.0%

23.8%

25.3%

16.6%

10.0%

10.6%

2.7% 1.9%

Market Share for Price Bands

0 ‐ $100K

$100K ‐ $200K

$200K ‐ $300K

$300K ‐ $400K

$400K ‐ $500K

$500K ‐ $750K

$750 K ‐ $1M

$1 M+

‐4.2 %

11.4 %

12.6 %

14.0 %

8.0%

3.3 %

11.5 %

Because sales in ranges

below $750,000 represent

the vast majority of

transactions in Virginia, they

are the clearest indicator of

market performance. The

highest number of

transactions by price band in

2016 Q4 happened in the

$200k to $300k range.

2016 Fourth Quarter



The average number of days on the market in the fourth quarter of 2016 decreased from the same

quarter last year by 10.4 percent. Declining days on the market reflect sustained demand and

reaction to the prospect of rate increases, as buyers continue to transact with urgency. Typical of

industry seasonality, average time on the market lengthened from the third quarter to the fourth.

0

10

20

30

40

50

60

70

80

90

100

2013Q1

2013Q2

2013Q3

2013Q4

2014Q1

2014Q2

2014Q3

2014Q4

2015Q1

2015Q2

2015Q3

2015Q4

2016Q1

2016Q2

2016Q3

2016Q4

Average Days on the Market

Average Days on the MarketSingle Family Homes, Townhomes, Condos

‐ 10.4 %

2016 Fourth Quarter



The changes in the pace of Virginia home sales in the fourth quarter tracked the changes in the

pace of sales in the United States as a whole.

Virginia median price changes were similar to the changes in the median of existing‐home sales

prices nationally for the fourth quarter of 2016. Both Virginia and the United States as a whole

showed moderate increase in median price year‐0ver‐year.

*Virginia sales reported in the graphs above include all single family, townhouse, and condo sales. U.S. sales are existing single family sales as

reported by the National Association of REALTORS®. Existing sales do not include newly constructed homes sold for the first time.

8,851

437,000

0

100,000

200,000

300,000

400,000

500,000

600,000

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Aug‐15 Oct‐15 Dec‐15 Feb‐16 Apr‐16 Jun‐16 Aug‐16 Oct‐16 Dec‐16

Monthly Residential SalesVIRGINIA (All MLS‐Reported Home Sales*) UNITED STATES (Existing Home Sales*)

80,000

130,000

180,000

230,000

280,000

330,000

Nov‐15 Dec‐15 Jan‐16 Feb‐16 Mar‐16 Apr‐16 May‐16 Jun‐16 Jul‐16 Aug‐16 Sep‐16 Oct‐16 Nov‐16 Dec‐16

Monthly Residential Median Sales PriceUNITED STATES (Existing Home Sales*) VIRGINIA (All MLS‐Reported Home Sales*)

2016 Fourth Quarter



The Virginia unemployment rate rose in the fourth quarter to seasonally‐adjusted 4.2 percent, on

par with the fourth quarter of 2015. Virginia unemployment continues to track below the national

average. Low unemployment is correlated with bolstered consumer confidence.

5.3% 5.3%5.1%

4.9% 4.8%

4.5%

4.2% 4.2% 4.1%

3.7%3.9%

4.2%

3.0%

3.5%

4.0%

4.5%

5.0%

5.5%

6.0%

2014‐Q1 2014‐Q2 2014‐Q3 2014‐Q4 2015‐Q1 2015‐Q2 2015‐Q3 2015‐Q4 2016‐Q1 2016‐Q2 2016‐Q3 2016‐Q4

Virginia Unemployment RateSource: Bureau of Labor Statistics

2016 Fourth Quarter



After multiple quarters of reduced average rates, average 30‐year and 15‐year fixed mortgage

interest rates increased notably in the fourth quarter of 2016. With more intense anticipation of a

hike by the Federal Reserve Bank in the key rate, and then its actual announcement in December,

rates rose relatively steeply from October to November and again through the final two months of

the year. Both the 30‐year and 15‐year fixed mortgage interest rates ended the year at their highest

points since the fourth quarter of 2015.

4.30%4.36%

4.23%4.14%

3.97%

3.72%3.83%

3.95%3.90%

3.74%

3.59%

3.45%

3.81%

3.00%

3.40%

3.80%

4.20%

4.60%

2013‐Q4 2014‐Q2 2014‐Q4 2015‐Q2 2015‐Q4 2016‐Q2 2016‐Q4

Average 30‐Year Mortgage Interest RatesSource: FreddieMac

3.35%3.40%

3.32%3.27%

3.18%

3.01%3.06%

3.15% 3.13%3.03%

2.85%2.75%

3.07%

2.20%

2.40%

2.60%

2.80%

3.00%

3.20%

3.40%

3.60%

2013‐Q4 2014‐Q2 2014‐Q4 2015‐Q2 2015‐Q4 2016 Q2 2016 Q4

Average 15‐Year Mortgage Interest RatesSource: FreddieMac

2016 Fourth Quarter



The Virginia REALTORS® association is the largest professional trade association in Virginia,

representing approximately 32,000 REALTORS® engaged in the residential and commercial real

estate business. The Virginia REALTORS® association serves as the advocate for homeownership

and private property rights and represents the interests of real estate professionals and property

owners in the Commonwealth of Virginia.

NOTE: The term REALTOR® is a registered collective membership mark that identifies a real estate

professional who is a member of the National Association of REALTORS® and subscribes to its strict

code of ethics.

All inquiries regarding this report may be directed to:

Jenny Wortham

Virginia REALTORS®

[email protected]

804‐262‐3755

The numbers reported here are preliminary and based on current entries into multiple listing

services. Over time, data may be adjusted slightly to reflect increased reporting. Information is

sourced from multiple listing services across Virginia and is deemed reliable, but not guaranteed.

Documents

Virginia · Virginia. For example, the economic region defined as Northern Virginia encompasses more counties ... Chesapeake, Franklin, Hampton, Newport News, Norfolk, ... Q3 2014