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Real Estate Blog by Windy Crutchfield, REALTOR®

A Healthy Housing Market Brings Challenges for 2017 Buyers

As most of you know, I update my website monthly with a review of current local housing market results. By examining the same economic factors on a regular basis, I can give buyers and sellers reliable and timely advice. It would be easy for me to provide my readers with a subscription to a newsletter that provides a national outlook, but my value to you as a real estate advisor is in knowing what is happening on a local level, as it happens. I also provide this annual review and forecast for the coming year.

2016 showed steady and healthy improvements in the economy. The United States is currently enjoying full employment (4.2%), a rising GDP, wage increases, and job gains. Job creation was however below expectation for economists and the annual growth rate was less than predicted. Home sales currently are the highest since February 2007 when the Recession began, but they still are $50,000 below the pre-recession sales prices. First-time buyers were at a 30 year low in 2015, but made gains to almost 50% in 2016. 61% of those first-time buyers were under the age of 35. The availability of starter homes, however, have dropped by 10%, making it harder for these young buyers to get into the market. In Virginia Beach, conservative sellers marketed their homes with only a 1% increase in list price from last year, but saw a 3.26 increase in sales prices and a 3.6 month absorption rate. Interest rates defied predictions and stayed below 4% for most of the year. Riding in on the strong economy is a new American President, espousing ideas that promote positive business growth. Stocks soared after the election to record highs. Based on the campaign platform, the technology, industrial, and transportation sectors should see healthy growth. Improvements to the sky-rocketing health insurance costs are expected with a modification to Affordable Health Care. And with a Republican-controlled Congress, the country should see the largest tax revolution since 1986, promoting...