Central Virginia’s real estate market is still strong but has relaxed slightly from some of the “craziness” earlier in the year, according to the Charlottesville Area Association of Realtors and its market report.
“The CAAR housing market continued to cool slightly in the fourth quarter [of 2021] with slower sales activity driven primarily by rising home prices and a lack of available inventory leaving buyers with few choices,” the report states.
The final quarter of the year is traditionally slow for home real estate, but CAAR President-Elect S. Lisa Herndon said that’s not happening.
“You’re still finding multiple offers in the market, which is surprising, and the weather makes no difference,” she said.
According to the report, 1,228 home sales occurred in the last three months, about a 5% decrease from the end of 2020.
Being a seller’s market, and even with slower sales activity, the area saw the median home price increase 6% from last year to $369,900 for the fourth quarter.
Herndon and CAAR President Pam Dent said low inventory has been the biggest factor, with just one month of supply at the end of the fourth quarter. There were 436 active listings in the region at the end of the quarter, which is 213 fewer active listings than a year ago, a decline of 33%, according to the report.
“Our inventory started declining, but at a slow rate, probably eight or 10 years ago, and then it accelerated during the pandemic,” Dent said. “We had people wanting to get out of the big cities and come down to a smaller area.”
She pointed to the increase in broadband access in counties like Nelson and Louisa, where people can keep their jobs from larger markets like Northern Virginia and Washington D.C., and have a home out in the country.
Nelson saw the highest percent increase in sales price in the fourth quarter to $388,750, up a “dramatic” 26% compared to a year ago, according to the report.
Albemarle County had the most expensive sale prices, with a median price of $425,000 in 2021’s last three months. The report said that “price growth has moderated” in the county, as the median is up 1% from the fourth quarter of 2020.
Charlottesville was second with a $399,000 median price for the quarter, about a 1% drop from its price in 2020’s last quarter.
Fluvanna County had a median price in 2021’s fourth quarter of $315,000, up 15% from the median price in the last quarter of 2020, while Greene County saw a 7% rise in median price to $325,215 in the fourth quarter of 2021.
Louisa County saw a decrease of 2% compared to the last three months of 2020, with a median price of $310,000.
Building permits were on the rise in the region in the fourth quarter, according to the report, but Dent said builders can’t build enough homes to fill the gap in what’s needed.
“It’s still going to be a year or more before those homes come to the market, and particularly with the supply chain issues, some of the construction products projects are taking longer to finish,” she said.
Herndon said she’s had to have conversations with buyers, especially first-time homebuyers, telling them they may not find their dream home and that the home they can afford might require a little more renovation.
She recommended finding professional help to navigate the market.
“There may have been times in the past where buyers felt comfortable diving into the process, but this market is not that market,” she said.