Richmond Real Estate Market Report

Blog by Arnold Shuchat | January 11th, 2015

Time to take a look at the first 2 weeks of 2015 and give an impression as to market sentiment.

Firstly over the last 11 days, there have been 48 price changes and the most noteworthy fact is that of the 48 changes, 16 or 33% of them are actually price increases.  Now one would have to acknowledge that in most cases were a seller to err on an initial price it would usually be on the high side... "We only need one buyer...." usually wears thin and most price adjustments are usually decreases.  In fact a review of most of the changes over the last couple of years only would show about 2-3 on any given price change list being increases. So this is an indication of strong seller market sentiment.

There have been 229 new listings and 69 new sales for an absorption ratio of 30% which is strong for this time of year.  In years past the action usually kicks up in the third week.  Here there has been an early strong push with a strong bite on early in the year as well.

Without getting too detailed into it, it appears that "9" is the new "8" in hundred of thousands for single family homes for sale on the west side.  When inventory grows, absorption times grow as buyers take more time to review the larger inventories.  But I suspect that there is quite a pent up demand for SFDs and buyers who know what they want and are prepared to move will have the greatest chance of success here.

In addition, there is the roster of sellers who felt that they missed the roaring 2011 market prior to March of that year.  They have been waiting, some of them getting on in years and they are looking to cash out. There have been many more estate sales in the last couple of years than I can remember.  There is definitely a changing of the guard here and I suspect that with good guidance, those aging sellers will not want to once again be trapped holding for another few years.  They will get out at or near the highs of 2011.

Below is a graph of a few key sub areas' Housing Price Index performance over the last few years.  The above reason is why I suspect listings are starting off the year pedal to the metal and why I think it should be a record spring 2015.