August brought an increase in median sale price and number of homes sold in the Hampton Roads Region, according to the Long & Foster Real Estate Market Minute Report. Hampton City experienced a 18% increase in sale price, while Virginia Beach City saw a 16% increase. Year-over-year units sold increased across the region, ranging from 15% in Norfolk City to 4% in Newport News City. Inventory continued to drop region-wide and time on market ranged from 30 to 41 days.
The fall housing market, which historically slows down, is expected to be quite strong this year. “In the fall of a presidential election year, we normally see a pull back in the housing market due to the uncertainty of the election,” said Gary Scott, president of Long & Foster Real Estate. “We believe this autumn will be different and we’re cautiously optimistic that low interest rates will drive the market, despite the pandemic, unemployment levels, social unrest and the upcoming election.”
With recent stock market volatility, consumers are taking advantage of low interest rates by purchasing real estate to diversify their portfolios. Real estate appreciates about 4% per year on average and generally does not go through massive price fluctuations, like the stock market.
“There’s never been a better time to borrow money, so it’s a great time to add an investment property to your portfolio,” said Scott. “Real estate investors can benefit from appreciation, depreciation, cash flow and equity build-up.” If you choose to diversify, it’s best to deploy your partners, such as your accountant and financial advisor, to help with your goals and objectives, Scott added.
COVID-19 (coronavirus) and low interest rates have changed consumer’s behavior very quickly. We are nearly at the highest rate of homeownership ever. Renters are determined to be buyers because of interest rates and others who were previously priced out of a certain market, can now afford to buy a home, resulting in higher homeownership rates.