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Virginia
The Virginia housing market flew during the real estate boom, only to stall when higher interest rates and the credit crunch hit. Virginia’s real estate markets will take a long while before conditions improve.
New home construction is already down by a third and home sales in many areas have slowed to the lowest level in at least twenty years, triggering lower prices that buyers have not yet warmed to. The housing markets in Virginia have seen better days.
The real estate slowdown has had a heavy impact on the economy. Window and door manufacturers have laid off employees. Carpenters are out of work. Home builders are canceling projects waiting to see what the economy will do with worries of a recession. The national housing recession has hit Virginia.
In Arlington, which is a bedroom community serving Washington D.C., prices have been declining for most of two years, although a summer spike helped the market last year. Arlington’s market will see more deteriorating conditions in 2008, and is forecast by Housing Predictor to deflate 6.1% on average home values.
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| City |
Forecast |
| Arlington |
− 6.1% |
| Alexandria |
− 7.2% |
| Richmond |
− 5.7% |
| Roanoke |
− 4.8% |
| Norfolk |
− 5.4% |
| Virginia Beach |
− 6.1% |
Many members of Congress make their homes in Alexandria at least when the House and Senate are in session. The market hadn’t begun to see major fall out from the credit crunch until the end of last year. But fewer buyers are in the market place and prices are falling. Alexandria will suffer through 2008 with slower sales and housing deflation projected to be 7.2%.
In Richmond, which has turned into one of the banking capitals of the nation, many have suffered from lay-offs and more job cuts are certain in this lending environment. Foreclosures are rising even in this banking capital as fall out from the credit crunch begins to be felt.
With lower average prices than other parts of Virginia the housing bubble’s burst won’t have as devastating effects in Richmond, deflating 5.7%.
In Roanoke the market’s troubles seem to start earlier than other places in the state as home sales slowed. Roanoke will see slower home sales in 2008 on 4.8% depreciation.
The housing bubble burst in Norfolk will also have an impact on the local economy as home construction slows and builders offer more incentives to sell already built homes.
Norfolk will see 5.4% in average deflation, according to the Housing Predictor forecast and slowly wander through a housing market that will take years to fully adjust.
In Virginia Beach, where easterners flock during the summer months to bask in sunshine and feel the cool waters of the Atlantic Ocean, the market has turned chilly. Virginia Beach is the most populated area in Virginia and it is suffering from the credit crunch.
Because many buyers pay cash for second homes typically second home markets are less effected by the influences of national real estate trends. But the Virginia Beach housing market is feeling the pinch forecast to deflate prices 6.1% by years end.
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