Richmond's bumpy real estate year
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High mortgage rates all but froze the U.S. housing market last year, Axios' Sami Sparber writes.
Why it matters: The "lock-in effect" is real. As one real estate agent put it, 2023 was "the year your first home accidentally became your forever home."
Driving the news: The number of Richmond-area listings available to buy has been dropping steadily since 2019, per the latest Redfin data.
- Metro Richmond's active listings went from 6,507 in October 2019 to 3,779 in October 2023, per Redfin.
- Last year, Richmond was on track to see its lowest number of closed sales in years, down 23% over 2022, according to the latest report from the Richmond Association of Realtors.
Meanwhile, prices kept climbing, hitting $368,750 in October, lower than the national median of $413,874, but roughly $130,00 higher than the median sales price at the start of 2019, per Redfin.
Zoom out: Across the country, it got even harder for first-timers to make the leap to homeownership last year.
- You now have to earn $105,000 a year to afford a typical Richmond house.
Yes, but: There is hope ahead. If the economy is steady, rates could land around 6%. If the economy stumbles, mortgage rates could fall more significantly, says Greg McBride, Bankrate's chief financial analyst, Axios' Brianne Crane reports.
- No one can say with certainty just how much mortgage rates will change because they are impacted by inflation and the Federal Reserve.
- Any change likely won't bring down prices much, but it could be enough to motivate folks to sell.