THE STATE OF REAL ESTATE: Local pros weigh in on current conditions
As homeowners—whether we plan to stay put, renovate, move neighborhoods or relocate to another city—the real estate market in our area is of interest to us all. It can be one indicator of the economic vitality and health of a region—something to which we are all attuned. HOME asked local Realtors and other experts to weigh in on what they’ve been experiencing in our area so far in 2015. Here, see what they have to say.
This year has been good but harder than the last two or three years. The market has been good and bad depending on the price range and area of Roanoke that you work in. I have had a lot of success in the higher-end market but it has certainly been hit or miss. There certainly are not enough high-end buyers in Roanoke to cover the supply, but the one thing that has really hit home this year is that homeowners can help their market as much as anything. Owners need to keep their homes renovated and their yard maintained; it has come close to impossible to get fair market value for an unkempt, outdated home. Buyers have become very aware of what materials and upgrades are out there and have become extremely picky. If you want to sell, you need to be better than the competition in quality and price.
In my experience, I continue to see growth and popularity in the neighboring communities within close proximity of Downtown Roanoke. Buyers are trending in urban, established, and gentrifying city neighborhoods. Active inventory has increased by 14 percent in the past year, and sales volume has increased by 25 percent within Roanoke City. In my opinion, we can still consider our current market condition a “buyer’s market,” with home prices remaining stable. The movement to live in an urban environment surrounded by culture, nightlife and art is attracting interest by all demographics.
Joe Patrick Kraft
Park Place Realtors
We have found this year’s Roanoke real estate market activity to be following the same upward climb we have seen over the previous two years. Buyers and sellers continue to feel comfortable with the economy and are moving on with life’s plans, moving up as families expand, or downsizing as they become empty nesters. As a result, we have seen an increase in activity in sales of higher-priced homes this year. There was a bit of a hiccup with the Norfolk Southern move, but things have settled down as folks realized there would not be an additional 500 houses on the market this spring. (The actual number is in the 140 range.) We anticipate strong activity for the rest of the year as sellers who held off on putting their homes on the market this spring due to the Norfolk Southern move decide to move on with their lives. Whether or not there is a buyer’s or seller’s market really depends on the neighborhood these days, and sellers have learned that they can create their own seller’s market by making sure their home is nicely appointed, in great condition, and priced competitively.
Cyndi and Jeff Fletcher
Berkshire Hathaway HomeServices Premier, REALTORS
We have seen a significant upswing in contracts generated this year over the past 12 months. The higher-cost homes do not seem to be selling quite as well as the middle and lower end. Homes that are well priced based on comparables within the market, as well as properties that are “move-in ready,” seem to be the fastest movers. We see the prices going up about 2 to 3 percent over a year ago and very little change with regard to number of days on the market. We are very optimistic about continued improvement throughout the rest of this year and a consistent improvement moving forward due in part to the upcoming election cycle.
As most Roanokers realize, due to the loss of many employers, we are in a buyer’s market. Nationally, the census bureau data showed that housing starts increased over 9 percent. This is the best news since July 2007. The prices may not be increasing as rapidly as they declined, but the number of home sales speaks volumes.
Robert A. Lichtenstein
Lichtenstein Rowan, REALTORS
The Roanoke real estate market has remained robust in the
first half of 2015. Total volume of homes sold is up a little
more than 16 percent over the same period last year. Units sold are up about 12.5 percent over 2014, and average home sale prices are enjoying a 3.2 percent appreciation. The market still is fairly heavy in terms of inventory and remains somewhat of a buyer’s market.
Absorption rate, which is a measure of supply and demand, shows 9.42 months of inventory against 9.34 months of inventory this time last year. Absorption rate assumes a snapshot of current home inventory and measures the rate at which homes are going under contract. The result is reflected in the number of months to deplete the entire inventory. Distressed properties (foreclosures and homes that are “under water”) are contributing to the current inventory. In addition, the relocation of certain companies and businesses are adding to an elevated inventory. By comparison, during the real estate boom, the absorption rate was just over 4 months of supply. And, during the peak of the downturn, the Roanoke market had about 18 months of inventory.
Interest rates remain at record lows and are forecasted to be favorable for the foreseeable future. It is a great time to buy a home, especially for first-time homebuyers.
Principal Broker/Managing Partner
The overall real estate market is as strong as it has been both in the Roanoke Valley and nationally since 2006. Price appreciation was up in 2014 over 2013 in Roanoke and is increasing again year-to-date in 2015. Interest rates continue to be historically low. If anyone has even the slightest interest in purchasing a house anytime soon, now is the time to buy! Interest rates certainly are going to increase over the next year. Even a 1 percent increase in the overall rate can make a HUGE difference in affordability!
The Norfolk Southern move has certainly increased the volume of homes on the market, but the market has responded well to it. The nicer and reasonably priced existing homes have sold. Though there are still a number of homes on the market, the market has absorbed a lot of them to date and will continue to do so. We anticipate a stronger fall in the new-home market as the inventory of existing homes dwindles.
We are in a buyer’s market now because of the increased number of homes for sale, so that’s just another reason to buy now. As an owner of three home-building firms building in the Roanoke Valley, I have seen an increase in buyers looking at our homes this year. While the market is competitive because of the number of homes on the market, new homes compare well with their newer features and better floor plans. We are seeing significant interest from baby boomers for patio homes and one-floor living choices. These homes have been our best sellers this year, and we are working now to offer more choices in no-maintenance living to buyers in the Roanoke Valley.
Boone Homes, Inc,
Berkshire Hathaway HomeServices Premier Realtors, Boone Homes Inc., Litchtenstein Rowan Realtors, MKB Realtors, Park Place Realtors