Richmond Market Mid-Year Review
We are almost through June and the market may have started to show some signs of slowing down… just a little. Some sellers are still hesitant to list their homes due to having to battle for the top dog spot on the buyer side. Many buyers have tried to go to new construction, but with only 2,094 new construction homes on the market this year, the demand is overpowering the supply.
I wrote earlier about the construction company’s strain to keep up with demand, build time has stretched to in some cases over 7 months. Resale homes are still going quickly; as of this being written there have been 11,998 homes listed, 11,028 pending and 9,303 listings closed on in 2021. The average price per sqft in the Richmond area is also on the rise from $143 a square foot in 2020 to $161 a square foot in 2021.
Even the number of days from when a listing goes active to having a ratified contract has dropped significantly from 13 in 2020 to 6 in 2021. It is still very much a sellers market, but it does look hopeful that mid year we have close to the same of amount of listings as in all of 2020 (12,046 in 2020 11,998 YTD.) Months supply of inventory has dropped from 2.2 months in 2020 down 59.1% to 0.9 months this year.
Many homeowners that were on the fence about buying and/or selling in 2020 have started to reopen the dialogue again. And let me just go “on the record” and throw out a kudos to lenders big and small for keeping up with the extremely high volume of applicants, mortgages, refinance etc. they have been seeing for the past 18 months or so. Somehow closings are still happening normally in the 30 day range.
Based on the data in my opinion and that is all that this is; one person’s opinion…the market is starting to plateau for the short term. Cautious sellers will hopefully re-enter the market now that the buyer market isn’t on fire like it was during the Covid lockdown. On the buyers side, offering thousands of dollars over asking price, forgoing inspections, waiving appraisals and paying sellers closing cost to win won’t be necessary anymore. There will be certain homes that warrant that but not on the scale we saw late 2020 and even early this year. I also haven’t see the mass exodus from certain states wanting to transplant their families here like that on a Texas or Florida scale, but their will always be those in smaller numbers that move closer to family that already reside here.
All data, numbers and percentages in this article were obtained legally from CVRMLS.