Richmond's real estate market is cooling, slightly
With pending home sales falling and asking price decreases more common, Richmond's real estate market is showing early signs of slowing down.
Why it matters: We keep hearing a market crash is coming, but so far, local data doesn't support that claim.
Yes, but: Monthly data shows early signs of a cooler market, even if it's slight.
What's happening: From May 2021 to May 2022, new listings were down 12% and pending sales were down 9.3%.
- More buyers are holding off as home ownership becomes too expensive — home prices are up 22.6% from June 2021 and mortgage rates recently surpassed 5% for the first time in 10 years.
- More sellers are dropping their asking price. There was a 5.2 percentage point increase in price reductions year over year in May, according to Redfin.
Zoom out: Nationally, mortgage applications were down 24%, and on average, 6.5% of sellers dropped their asking price each week in June, per Redfin's latest market update.
- In June, national pending home sales were down 13% from this time last year, the largest decline since May 2020, Redfin's report stated.
Be smart: Inventory is still critically low overall, which continues to push home prices up.
What we're watching: New listings and pending sales. If more listings flood the market this summer and buyers don't bite, that's when we would start to see more power shift into buyers' hands.
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