The Hampton Roads real estate market experienced large gains and declines during August 2011. The number of homes that were listed for sale, those homes that went under contract and the number of residential settled sales all had double digit moves when compared to August 2010. The distressed residential market also showed signs of improvement.
The number of residential listings for sale in August 2011 was down 15% when compared to August 2010. This is the largest decline on a year-over-year basis since May 2004 when there was a 16.7% decline. All seven of the major local cities (Chesapeake, Hampton, Newport News, Norfolk, Portsmouth, Suffolk and Virginia Beach) saw decreases, with six of those having declines greater than 10%. The sharp drop in active residential listings contributed to the 5.7% fall in the months’ supply of inventory measurement in August as well. Over the past year, the months’ supply of inventory has fluctuated, but not at this magnitude.
Nearly 1 of every 3 homes sold in August – 29 percent – were in foreclosure or sold for less than what the homeowner owed last month, reported Real Estate Information Network Inc. That’s up from 25 percent a year ago.
The number of residential under contract sales grew by 23.4% in August this year when compared to the same time last year. All seven of the major local cities experienced year-over-year gains. Newport News had the largest gain, 57%, with Norfolk showing the second largest, 49%. The rise in under contract sales provides foreshadowing for future sales, but does not guarantee these sales figures over the next few months.
Rounding out the month’s positive trend, the number of residential settled sales was higher in all seven major local cities and the region as a whole in August 2011 when compared to August 2010. The region showed a 15.8% year-over-year rise in settled residential sales. Chesapeake and Newport News had the highest gains, 39% and 37% respectively. Suffolk had the smallest improvement with 5% growth. The median settled sales price for these homes was down 6.8% when compared to those homes sold in August 2010. For year-to-date 2011, the median residential settled sales price is $195,000, or 9.7% lower than the same time period last year when it was $216,000.
The distressed homes market, those that are bank owned or short sales, grew as a percentage of residential active listings, but fell as a percentage of residential settled sales. Distressed homes grew slightly as a percentage of homes actively listed for sale to 22.6%, the highest percentage since February 2011. However, the percentage of residential settled sales that distressed homes comprised fell to 29.3% which is the lowest percentage since September 2010. Overall, the number of individual distressed homes in the Hampton Roads real estate market is declining, down 12.8% since the beginning of this year. Since the year began the number of active distressed homes listed for sale has dropped each month from 2,897 to 2,526. Should this trend continue, the distressed homes market in Hampton Roads may stabilize and lessen its impact on the non-distressed homes market, namely prices.
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