What seemed like rock bottom home prices Virginia homes were getting are projected to slip further as the region encounters greater economic turmoil recovering from the real estate collapse. The housing market in most of Virginia seemed as though it was on the mend, but an uptick in foreclosures is troubling the region and sending prices on homes lower, despite a surge of federal employees from the nation’s capital buying homes.
Home sales in posh Alexandria fell towards the end of 2011 providing another obstacle for the market to overcome as home prices fell. The region has been experiencing an upshot in home sales as a result of so many workers from the nation’s capital buying homes in the area. Sales should recover during the year in Alexandria on forecast deflation of 4.0% in 2012.
Arlington homeowners are concerned over rising foreclosures in their community as more mortgage holders walk away from their underwater homes. The area has seen housing prices level-off in recent months after a surge in home sales. However, a projected increase in bank assisted short sales and foreclosures are expected to pressure home prices, which are forecast to decline 3.3% for the year.
Richmond has seen home sales rise and fall as its market tries to recover from the worst real estate collapse since the Great Depression. A resurgence in foreclosures is already weighing heavily on the area and is sure to send home values lower yet, but a recovery will be assisted by tax payer money spent in the region. Sales are projected to rise in 2012 on 4.5% deflation.
The housing market in Hampton Roads should recover sooner than many other areas of the state with a higher demand for homes in the area. Sales appeared promising for a while with near record low mortgage rates, but returned to being sluggish. Housing prices are forecast to drop another 3.8% in 2012.
Second home sales in Virginia Beach are suffering through the housing slump, but discount priced foreclosures should prompt buyers to make more purchases towards spring before summer returns for vacationers to enjoy the beaches. Housing values are forecast to drop 5.3% on coastal properties over the year.
In Norfolk and Newport News a lower unemployment rate than many other areas of the country has helped to push home buyers off the fence, but the market is still reeling from an over supply of homes that will need to be sold off before a real housing recovery can start. Home values for the area are forecast to drop another 4.0% for 2012.