Virginia's housing market sees the biggest drop in sales since the beginning of the pandemic

Posted at 10:06 AM, Jul 22, 2022
and last updated 2022-07-22 10:06:53-04

RICHMOND, Va. -- Virginia's housing market is seeing the sharpest drop in sales since the beginning of the pandemic.

Despite this, home prices keep rising.

The market is cooling down, but inventory is still causing prices to continue trending upward. In addition to prices, high interest rates are also driving people out of the market.

June 2021 was a record month for home sales in Virginia with nearly 17,000 homes sold.

In June 2022, the number of homes sold sat at just over 13,000.

The Virginia Association of Realtors (VRA) said this is the biggest drop-off in Virginia's housing market since the beginning of the pandemic.

Chief economist Ryan Price attributes the slow down to rising interest rates which the Federal Reserve has been increasing to combat inflation.

Price said this is leading potential buyers to push pause on their home search.

"These buyers are more likely to be, you know, first-time homebuyers, maybe folks who don't have as large of a downpayment to kind of offset some of those interest rate increases. People that are a little bit more price sensitive," Price said.

In the Richmond Metro, the median price of a home is about $380,000, according to Price.

While sales are down across the region, VRA's data shows the biggest drop-off from last June to this June was in Chesterfield County.

Going forward, Price said as the market continues to cool, he expects price growth to ease in the coming months.