53
New Residential Market
Authors Ron Wildermuth and Blair Hardesty
Data Analysis/ Residential DataBank
Layouts
Existing Residential Market
Author James Pritchard
Data Analysis/ Manager, Data & Analytics
Layouts Real Estate Information Network, Inc.
Hampton Roads MLS
Financial The E. V. Williams Center for Real Estate and Economic Support Development (CREED) functions and reports are funded by donations
from individuals, organizations and the CREED IPAC and CouncilAdvisory Boards.
Disclosure The data used for this report are deemed reliable; however, neither Old Dominion University, the E. V. Williams Center for Real Estate and Economic Development, nor sponsoring companiesand/or individuals makes any representation or warranty as to itsaccuracy.
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H A M P T O N
R O A D S
M A R K E T
R E V I E W
RESIDENTIAL
542012 Hampton Roads Real Estate Market Review
The housing tsunami that saw housing hyper- inflation fol-lowed by a housing depression has taken its toll on theindustry nationally and locally. For now the public attitudetoward housing as an investment has shifted to one of housing as a necessity. The “for sale” markets’ loss has beenthe “for rent” markets’ gain as many would be new home buyers chose to rent.
The year 2011 was a pivotal year in the long market adjustment process, now in its 5th or 6th year, depending on whatmetric you use to measure the market. Inventories of detached and attached new homes all but disappeared in 2011and high rise condos showed their strongest inventory reductions since the housing recession began. The significantincrease in high rise condo sales was due to aggressive price reductions by several key players and, in the case of onehigh profile condo project, the use of alternative marketing methods. The year was characterized by builders continuingto adjust their market position, re-evaluate margin expectations, value engineer, fine tune their products and deal withforced lot cost write downs. Meanwhile, banks stepped up efforts to find workout solutions for troubled residential build-ing sites.
Foreclosures were a drag on the new construction market as many potential new home buyers succumbed to the temp-tation of rock bottom distressed sale prices. In 2012, foreclosures will be less of a factor as inventories continue to drawdown, but short sales will be a big factor as more owners who are ready to sell find themselves trapped in homes withunderwater mortgage balances.
NEW CONSTRUCTION
2012 R E S I D E N T I A L
he Hampton Roads Residential market statistics covered in this report analyze the new homebuilding industry and the existing home sales activity for the year 2011. Included are the cities ofChesapeake, Hampton, Newport News, Norfolk, Poquoson, Portsmouth, Suffolk, Virginia Beach,and Williamsburg, and the counties of Gloucester, Isle of Wight, James City, and York. The new
homes portion of the report also includes informationfor Franklin and Southampton, while the existinghomes section of the report contains additionalinformation on Surry, Matthews and Currituck. The newconstruction data contained in this report wasgathered from the actual deeds recorded and from thebuilding permits issued by each city or county. Thesales data and existing home closings data wasgathered from the Real Estate Information Network(REIN).
General Overview
T
Amidst the doom and gloom there are indications of a bottoming in the key metrics of the residential new constructionmarket as the downward trend lines in permits, closings, average sales price and revenue all show clear signs ofleveling off.
The unprecedented affordability of a new home and near record low interest rates, combined with diminished homebuyerfears of a further decline in home values, have started to attract buyers back into the market.
What is needed now is a sustained economic recovery that generates robust employment growth which is the primarydriver of a healthy residential new construction market.
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2011 VERSUS 2010 RESIDENTIAL NEW CONSTRUCTION HIGHLIGHTSPermits down 9.3% with 289 fewer permits issued totaling 2,811
Closings down 2.8% with 67 fewer closings totaling 2,350
Average Sales Price down 3.4 %, a $10,802 decline to $309,238
Total Revenue down 6.1%, a decline of $46.8 mil to $726,710,422
(See Table # 1 for Details)
Table 1
02 03 04 05 06 07 08 09 10 11
Permits 6700 6978 7271 7854 7359 5035 3393 2911 3100 2811
Closings 5097 4841 5466 5128 4864 4153 3318 2775 2417 2350
Avg SalesPrice 215,161 244,113 295,114 363,818 395,928 387,116 361,496 321,711 320,040 309,238
TotalRevenue
(millions)1,097 1,182 1,613 1,866 1,926 1,608 1,199 893 774 727
Graph 1 Permits Graph 2 Closings
Graph 3 Average Sales Price Graph 4 Total Revenue (in Millions)
6,000
5,000
4,000
3,000
2,000
1,000
0
2,500
2,000
1,500
1,000
500
0
9,000
6,000
3,000
0
500
400
300
200
100
0
02 03 04 05 06 07 08 09 10 11 02 03 04 05 06 07 08 09 10 11
02 03 04 05 06 07 08 09 10 11 02 03 04 05 06 07 08 09 10 11
Thou
sand
s
Mill
ions
562012 Hampton Roads Real Estate Market Review
The run-up to the market peak that occurred from 2002 to 2004 and 2005 was followed by several years of decline inpermits, closings, sales price and revenue. But in 2010 and 2011, there were clear signs that the downward trend wasleveling off to create a market bottom from which a recovery can take place.
THE TEN YEAR TREND . . . .
DetachedDetached permits were down 3.4% to 2,044. Closings increased by 2.2% to 1,509 due to an increase in the availabilityof value priced detached homes in communities like Turtle Creek in Newport News, Hampshire Glen in Hampton andRose Glen Manor in Virginia Beach. The average sales price declined 3.6% to $345,368 and detached revenue declinedby 1.5% to $521.1 mil.
Attached — MultistoryMultistory permits were down 14.6% to 105. Closings increased by 11.1% to 160 due to dramatic price concessionsat several condominiums. The average sales price declined 6% to $261,194. Multistory condos were the only prod-uct type with increased revenues which was due to the significant increase in closings. Multistory revenues totalednearly $41.8 mil.
Attached — MultiplexMultiplex permits were down 35% to 160. This portion of the residential market was hit hardest and is attributed to firsttime homebuyers that continue to stay away and those that chose to purchase distressed properties. Closings were down15% to 198, the largest decline of the four product types. Average prices were down 5.7% to $216,140 as a result ofincreased competition in this market segment. This group experienced the largest revenue decline of 19.9% to just under$42.8 mil.
Attached — Townhouse/DuplexTownhouse/Duplex permits were down 18.4% to 502 as many buyers opted for detached foreclosure and short sale prop-erties. Closings were down 14.2% to 483 and average sales prices were down 6.5% to $250,440. Revenues experiencedthe 2nd largest decline of the four product types down 19.8% to $120.9 mil.
(See Table # 2 and Graphs # 5 - # 9 for details)
2011 VERSUS 2010 CONSTRUCTION ACTIVITYBY PRODUCT TYPE
2012 R E S I D E N T I A L
FROM PEAK TO TROUGH . . . . Permits down 64.2% with 5,043 fewer permits issued in 2011 versus 2005
Closings down 57% with 3,116 fewer closings in 2011 versus 2004
Average Sales Price down 21.9%, an $86,690 decline from 2006 to 2011
Total Revenue down 62.3%, a decline of $1.2 billion in 2011 compared to 2006
(See Table # 1 and Graph #’s 1 – 4 for details)
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Table 2 NEW CONSTRUCTION ACTIVITY 2010 vs 2011Hampton Roads, Va - by Product Type
Product Type * Permits Closings Avg Sales Price Revenue 2010 2011 % Change 2010 2011 % Change 2010 2011 % Change 2010 2011 % Change
Detached 2116 2044 -3.4% 1477 1509 2.2% 358,378 345,368 -3.6% 529,323,913 521,160,889 -1.5%
Multistory 123 105 -14.6% 144 160 11.1% 277,805 261,194 -6.0% 40,003,969 41,791,119 4.5%
MultiPlex 246 160 -35.0% 233 198 -15.0% 229,325 216,140 -5.7% 53,432,711 42,795,705 -19.9%
Town/Dup 615 502 -18.4% 563 483 -14.2% 267,807 250,440 -6.5% 150,775,239 120,962,709 -19.8%
Totals/Avgs: 3100 2811 -9.3% 2417 2350 -2.8% 320,040 309,238 -3.4% 773,535,832 726,710,422 -6.1%
Graph 5 Permits Graph 6 Average Sales Price
Graph 7 Closings Graph 8 Total Revenue
Town/Dup
Multiplex
Multistory
Detached
Town/Dup
Multiplex
Multistory
Detached
Town/Dup
Multiplex
Multistory
Detached
Town/Dup
Multiplex
Multistory
Detached
0 500 1000 1500 200 2500
0 200 400 600 800 1000 1200 1400 1600 0 50 100 150
0 100 200 300 400 500
2011 Permits
2011 Permits
2010 Permits
2010 Permits
2011 Ave.Sales Prices
2010 Ave.Sales Prices
2011 Revenue
2010 Revenue
Thousands
Millions
Graph 9 Product Mix 2011 Closings
64%
7% 8%
21%
Detached Multistory Multiplex Town/Dup
582012 Hampton Roads Real Estate Market Review
2012 R E S I D E N T I A L
PermitsPermits were up in four cities. The largest gainer was Newport News, up 23.5% to 226 permits issued. Permits were downin nine cities/counties. The largest percentage decline was in Isle of Wight County, down 31.4% to 83 permits issued. Thelargest reduction in the number of permits issued occurred in James City County, down 117 permits for the year.
ClosingsClosings were up in 2011 compared to 2010 in five cities including Chesapeake, Hampton, Newport News, Portsmouthand Williamsburg. Although Williamsburg had the largest percentage increase of 50%, Newport News had the largestnumber increase, up 45 closings for a 45.9%increase. Virginia Beach, Suffolk, Norfolk and thecounties of Isle of Wight, James City, York andSouthampton all saw declines in closings. Thelargest percentage loser was Southampton County,down 43.8% and the largest number loss was Suffolkwith 54 fewer closings in 2011.
Average Sales PriceThe average sales price declined in all but twocities/counties. James City County and NewportNews both saw increases. The James City Countyaverage increased 4.2% to $327,752. Newport Newsincreased 6.2% to $221,525.
Sales prices in the remaining citiesdeclined as little as -.7% in VirginiaBeach to -11.7% in Norfolk.
RevenueThere were revenue increases insix cities. The largest percentage and dollar value increase occurred in Newport News with a 54.9% increase in revenueto $31.6 million, an $11.2 million increase compared to 2010. Seven cities/counties showed declines in revenue. YorkCounty had the largest percentage and dollar volume decline, down 47.5% with total revenue of $23.8 million, a $21.5million drop.
(See Table # 3 for details)
2011 VERSUS 2010 NEW CONSTRUCTION ACTIVITY BY CITY
Closings were up in 2011 compared to 2010 in fivecities including Chesapeake, Hampton, NewportNews, Portsmouth and Williamsburg.
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NEW CONSTRUCTION ACTIVITY 2010 vs 2011Hampton Roads, Va — By City
City/County Permits Closings Avg Sales Price Revenue
2010 2011 % Change 2010 2011 % Change 2010 2011 % Change 2010 2011 % Change
CHES 722 653 -9.6% 545 576 5.7% 310,238 298,111 -3.9% 169,079,477 171,711,923 1.6%
SOHAM 46 32 -30.4% 16 9 -43.8% 225,763 214,861 -4.8% 3,612,200 1,933,750 -46.5%
GLOUC 109 105 -3.7% 37 37 0.0% 259,809 238,463 -8.2% 9,612,946 8,823,119 -8.2%
HAMP 144 168 16.7% 105 130 23.8% 265,293 260,309 -1.9% 27,855,806 33,840,178 21.5%
I of W 121 83 -31.4% 95 63 -33.7% 317,470 299,641 -5.6% 30,159,661 18,877,380 -37.4%
JCC 468 351 -25.0% 334 325 -2.7% 314,511 327,752 4.2% 105,046,608 106,519,476 1.4%
NNEWS 183 226 23.5% 98 143 45.9% 208,686 221,525 6.2% 20,451,254 31,678,067 54.9%
NORF 173 210 21.4% 165 150 -9.1% 330,013 291,322 -11.7% 54,452,162 43,698,277 -19.7%
PORT 62 46 -25.8% 45 52 15.6% 196,439 190,488 -3.0% 8,839,770 9,905,385 12.1%
SUFF 303 259 -14.5% 272 218 -19.9% 301,694 296,328 -1.8% 82,060,691 64,599,528 -21.3%
VBCH 587 538 -8.3% 557 540 -3.1% 378,364 375,554 -0.7% 210,748,648 202,799,417 -3.8%
WMSBG 34 35 2.9% 22 33 50.0% 281,942 256,770 -8.9% 6,202,729 8,473,424 36.6%
YORK/POQ 148 105 -29.1% 126 74 -41.3% 360,428 322,304 -10.6% 45,413,880 23,850,498 -47.5%
Totals/Avgs: 3100 2811 -9.3% 2417 2350 -2.8% 320,040 309,238 -3.4% 773,535,832 726,710,422 -6.1%
For 2011, the top two subdivisions for permits were both attached residential products. The No 1 subdivi-sion was Kings Pointe at Western Branch in Chesapeake with 70 permits for a mixture of non-elevator servedmulti-story condominiums and four-plex condominiums. The No 2 subdivision for permits was Windy Knollsby Beco Construction in Newport News which had 63 permits issued for three 21-unit buildings. The top sin-gle family detached subdivision for permits was Hampshire Glen in Hampton. Of the 60 permits issued, 57were to HHHunt Homes.
The top subdivision for closings and revenue for 2011 was Colonial Heritage in James City County by TheLennar Corporation. Of the 63 closings recorded, 44 were detached and 19 were duplexes with average clos-ing prices of $353,564 and $258,368. Hampshire Glen was No 2 for closings with 54 recorded and divid-ed between HHHunt Homes (46), Sadler Building Corp (5) and Stylecraft Homes (3). Southmoor at RidgelyManor in Virginia Beach was No 3 with 46 closings recorded and an average price of $163,809.
Sherwood Lakes in Virginia Beach was the No 2 community for revenue in Hampton Roads with $17,916,153in revenue divided between Home Associates of VA with $11,378,816 and HBD Building with $6,537,337.Heritage Park in Virginia Beach was the No 3 community for revenue with 29 closings totaling $17,690,898.There were eight builders with closings in Heritage Park and L R Hill Custom Builder was the top builder with10 closings recorded and $5,751,675 in revenue during 2011.
(See Table # 4 for details)
HAMPTON ROADS 2011 TOP SUBDIVISIONS
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602012 Hampton Roads Real Estate Market Review
2012 R E S I D E N T I A L
HAMPTON ROADS 2011 TOP BUILDERS
Ryan Homes was the top builder in Hampton Roads for permits, closings and revenue. Ryan Homes is actively buildingin 11 new communities on the Peninsula including eight detached and three townhome communities. Their topdetached subdivision for permits was Turtle Creek in Newport News with 36 permits, and for closings was Fenwick Hillsin James City County with 31 closings recorded. Greensprings West in James City County was their top community forrevenue with $10,208,067.
HHHunt Homes was the No 2 builder for permits with 151 issued during 2011. HHHunt was active in seven commu-nities on the Peninsula during the year including five detached and two attached. Most of the permits were issued toHampshire Glen in Hampton and Meridian Parkside in Newport News with 57 permits each. The Dragas Companieswas the No 3 builder for permits with 134 issued across four communities in Chesapeake including Brighton Park, KingsPointe, Oakbrooke Crossing and their latest community, The Grove at the Arboretum.
Dragas was the No 2 builder for number of closings with 155 recorded during 2011. Southmoor in Virginia Beach hadthe most closings at 46. HHHunt Homes was the No 3 builder for number of closings recorded with 106. HampshireGlen in Hampton had the most with 46.
(See Table # 5 for details)
Ryan Homes is actively building in 11 new com-munities on the Peninsula including eightdetached and three townhome communities.Their top detached subdivision for permits wasTurtle Creek in Newport News with 36 permits,and for closings was Fenwick Hills in James CityCounty with 31 closings recorded andGreensprings West in James City County was theirtop community for revenue with $10,208,067.
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Permits Closings
SubdivisionPermitsIssued Subdivision
ClosingsRecorded
AveragePrice Subdivision
TotalRevenue
1 Kings Pointe, C 70 1 Colonial Heritage, J 63 324,854 1 Colonial Heritage, J 20,465,794
2 Windy Knolls, N 63 2 Hampshire Glen, H 54 281,509 2 Sherwood Lakes, V 17,916,153
3 Hampshire Glen, H 60 3 Southmoor, V 46 163,809 3 Heritage Park, V 17,690,898
4 Meridian Parkside, N 57 4 Sherwood Lakes, V 44 407,185 4 Hampshire Glen, H 15,201,482
5 Sherwood Lakes, V 54 5 Brighton Park, C 44 182,212 5 Sajo Farm, V 13,715,791
6 Colonial Heritage, J 52 6 Oakbrooke Crossing, C 41 179,063 6 East Beach, R 13,162,884
7 Culpepper Landing, C 49 7 Meridian Parkside, N 37 195,965 7 Woodbridge Point, V 12,131,975
8 Whitehall, J 38 8 Sajo Farm, V 35 391,880 8 Greensprings West, J 11,872,067
9 Sajo Farm, V 37 9 Woodbridge Point, V 33 367,636 9 Culpepper Landing, C 10,198,831
10 Turtle Creek, N 36 10 Fenwick Hills, J 32 283,521 10 Fenwick Hills, J 9,072,675
11 Woodbridge Point, V 35 11 Harbour Breeze Estates, S 31 267,005 11 Rose Glen Manor, V 8,775,450
12 Parkside, S 34 12 Heritage Park, V 29 610,031 12 Harbour Breeze Estates, S 8,277,167
13 Oakbrooke Crossing, C 32 13 Village at Quarterpath, W 29 244,446 13 Brighton Park, C 8,017,313
14 Riverwalk Townes, Y 28 14 Riverwalk Townes, Y 29 240,719 14 The Westin, V 7,973,000
15 East Beach, R 27 15 Culpepper Landing, C 28 364,244 15 Stonehouse, J 7,890,241
PPermits Closings
BuildersPermitsIssued Builders
ClosingsRecorded
AveragePrice Builders
TotalRevenue
1 Ryan Homes 205 1 Ryan Homes 178 309,177 1 Ryan Homes 55,033,436
2 HHHunt Homes 151 2 Dragas Companies 155 176,032 2 Chesapeake Homes 30,054,644
3 Dragas Companies 134 3 HHHunt Homes 106 244,019 3 Dragas Companies 27,284,891
4 Chesapeake Homes 95 4 Chesapeake Homes 104 288,987 4 HHHunt Homes 25,865,970
5 McQ Bldrs & Dev Inc 93 5 McQ Bldrs & Dev Inc 79 285,894 5 McQ Bldrs & Dev Inc 22,585,650
6 Beco Constr 88 6 Lennar Corp 63 324,854 6 Lennar Corp 20,465,794
7 Bishard Dev Corp 63 7 Terry Peterson Res 63 298,764 7 Terry Peterson Res 18,822,156
8 Lennar Corp 52 8 Napolitano Homes 47 361,576 8 Napolitano Homes 16,994,085
9 Terry Peterson Res 52 9 Ashdon Bldrs 46 329,452 9 Home Assoc of VA 16,592,640
10 Pace Constr & Dev 48 10 Hearndon Constr 46 288,787 10 Ashdon Bldrs 15,154,798
11 Ashdon Bldrs 47 11 Home Assoc of VA 41 404,699 11 Stephen Alexander Homes 13,830,947
12 Hearndon Constr 45 12 Moody Dev Corp 39 205,234 12 Hearndon Constr 13,284,214
13 Home Assoc of VA 44 13 Bishard Dev Corp 37 305,237 13 Pace Constr & Dev Inc 11,978,727
14 Virginia Ent 43 14 Pace Constr & Dev 35 342,249 14 Bishard Dev Corp 11,293,767
15 Platinum Homes 39 15 Franciscus Homes 34 236,978 15 Armada Hoffler 10,343,400
Table 5
Table 4
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622012 Hampton Roads Real Estate Market Review
2012 R E S I D E N T I A L
The Hampton Roads existing residential real estate market showed signs of stability throughout the year 2011.Existing home closings picked up from where the leading indicators left off at the end of 2010. Even without the influ-ence of the federal first-time home-buyer’s tax credit, closings on existing homes rose, though many of those closingswere of distressed homes. Not all quarters of 2011 were positive. Although the first, third and fourth quarters expe-rienced growth in closings of existing homes each month, the second quarter was negative when compared to the sec-ond quarter of 2010. Overall, the region flourished as inventory levels dropped and closings rose for the vast majori-ty of local cities and counties.
The active inventory of existing homes for sale in the region for 2011 fell as measured at year end 12% when com-pared to 2010. There were 8,614 existing homes for sale at the end of 2011 whereas there were 9,809 existinghomes for sale at the end of 2010. The sharp drop in existing homes for sale and the consistent growth of closingsduring the majority of 2011 caused the months’ supply of inventory in the Hampton Roads region to fall to 6.9 months.A measure between six to eight months inventory is within most experts’ ideal range of supply to signify a healthy mar-ket. However, this particular measure does not account for the added inventory new construction homes contributeto the entire real estate market supply.
EXISTING HOMES
25,000
20,000
15,000
10,000
5,000
0
$250,000
$200,000
$150,000
$100,000
$50,000
$02000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
5,53
816
,612
$99,999
$49,300
$64,100
$109,900$117,050
$130,000
$157,900
$194,500
$215,000
$60,300$65,100 68,200
$59,100$56,600$55,200$53,800$51,000
$224,900
$219,900
$208,000 $205,000$194,000
4,87
318
,430
3,83
119
,604
2,80
120
,881
2,01
523
,209
2,09
324
,207
4,31
321
,890
6,98
2
18,5
72
9,05
514
,517
10,0
7715
,526
9,80
914
,265
8,61
415
,017
Existing Active Homes for Sale Existing Home Closings Existing Home Median SP HUD Median Household Income
$68,200
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40%
35%
30%
25%
20%
15%
10%
5%
0%
2,500
2,000
1,500
1,000
500
0
Existing Real Estate Closings
Average Days on Market for Existing Homes
JAN09
FEB09
MAR09
APR09
MAY09
JUN09
JUL09
AUG09
SEP09
OCT09
NOV09
DEC09
JAN10
FEB10
MAR10
APR10
MAY10
JUN10
JUL10
AUG10
SEP10
OCT10
NOV10
DEC10
JAN11
FEB11
MAR11
APR11
MAY11
JUN11
JUL11
AUG11
SEP11
OCT11
NOV11
DEC11
Distressed ExistingHome Closings
Existing Home Closings % Distressed of Closings
120
100
80
60
40
20
02000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
6961
4636
27 28
48
66
84 87 87
101
Average Days on Market for Existing Homes
Existing home closings rose 5% in 2011 to 15,017 from 14,313 closed in 2010. Virginia Beach had the largestpercentage of the existing closings at 31%, down from the 33% measured in 2010. Chesapeake, Norfolk andNewport News each had 10% or more of the existing home closings. Norfolk showed significant growth of exist-ing home closings for a total of 14% in 2011. The rest of the local cities and counties experienced less than a1% gain or loss as a percentage of all existing home closings in 2011.
Once the federal first-time home-buyer tax credit ended in 2010, sale prices of existing homes in the region beganto fall. The trend continued throughout 2011 for existing home closings. Each month, measured on a year-over-
63
642012 Hampton Roads Real Estate Market Review
2012 R E S I D E N T I A L
year basis, experienced median sale price declines. Overall, the region’s median sale price of existing homes fell to $194,900in 2011. This 5% decline follows the 1% fall in 2010 and a prior 5% drop in 2009. Since the peak median sales price in2007 of $224,900, the region’s median sales price for existing homes has fallen 13%. In addition to the median sale pricefor existing homes being lower in 2011, the average sale price of these same homes in 2011 was down 10% when com-pared to 2010.
Not a single city or county in the Hampton Roads region experienced a median sale price increase for 2011. Suffolk andWilliamsburg fared the best with each showing flat median sales prices of existing homes for the year. However, Williamsburghad a 9% increase in the average sale price of existing homes for the year in 2011 when compared to 2010 statistics. Itwas the only city or county to measure a positive increase in either median or average sales price of existing homes during2011.
James City County had the highest median existing home sale price at $285,000 in 2011, down 5% from the median saleprice of $295,000 in 2010. York County was the second highest median in 2011 at $270,000, down from $278,000 in2010. Norfolk, Portsmouth, Poquoson, and Currituck County experienced median sale price drops of 7% to 8%. At the other
$225
,500
$230
,000
$223
,950
$232
,500
$213
,750
$205
,000
$201
,000
$198
,350
$190
,625
$169
,250
$155
,000
$146
,900
$254
,950
$256
,000
$245
,000
$301
,900
$295
,000
$285
,000
$265
,000
$215
,000
$179
,800
$183
,900
$172
,250
$162
,500
$175
,000
$164
,900
$152
,100
$293
,700
$270
,000
$250
,000
$150
,500
$135
,000
$124
,850
$230
,000
$212
,000
$210
,000
$135
,000
$173
,500
$152
,750
$230
,000
$230
,000
$223
,950
$229
,000
$215
,500
$215
,250
$290
,000
$279
,000
$270
,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,00
$50,000
$0
CHES
CURR
GLOC
HAM
P
IWC
JCC
MAT
C
NNEW
NORF
POQ
PORT
SUFF
SURC
VBCH
WM
BG
YORK
2009 Median SP Existing Homes 2010 Median SP Existing Homes 2011 Median SP Existing Homes
Existing Homes Median Sale Prices
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end of the spectrum, Portsmouth had the lowest median sale price for existing homes at $124,850.Hampton had the next lowest median sale price closed at $146,900 for existing homes in 2011, 5% lowerthan the average price of $155,000 in 2010.
Detached existing home closings comprised 11,918 or 79% of all existing home closings and increased5% from 11,315 in 2010. Within the Hampton Roads region, only Suffolk and Virginia Beach did not expe-rience growth in the number of detached existing home closings; down year-over-year by 1%. Most citiesand counties showed year-over-year detached existing home sales gains of 10% or larger. For instance,Norfolk increased 15% from 1,539 detached existing home sales in 2010 to 1,764 in 2011. Another areawith large year-over-year gains was Isle of Wight County; it saw a 16% increase in the number of detachedexisting home sales to 237 in 2011 compared to 204 in 2010.
Attached existing homes market did not experience strong gains across as many cities and counties with-in the Hampton Roads region in 2011. For the year, the region experienced a 3% increase in attachedexisting home closings to 3,099 in 2011 from 2,998 in 2010. A handful of cities saw an increase in thenumber of attached existing homes that closed in 2011. Norfolk had the largest year-over-year gain of36%, followed by Newport News with a 17% increase. Poquoson and Isle of Wight County had the largestyear-over-year drop-offs, 30% and 25% respectively. The median sale price of attached existing home clos-ings in 2011 declined 6% to $155,000 in 2011 from $165,000 in 2010.
Distressed homes, those that are bank owned or short sales, increased both their presence and effectson the existing residential real estate market in Hampton Roads during 2011. Throughout the year, dis-tressed homes comprised between 22% and 26% of the active existing homes for sale in the region on amonthly basis, peaking in December. Virginia Beach, Chesapeake and Norfolk showed the most activitypertaining to distressed existing homes. This is largely due to the population densities within these cities.
Distressed homes in the Hampton Roads region also comprised between 29% and 42% of closed existinghome sales during 2011 on a monthly basis. The peak for these sales was in February. The percentagethen tapered off sharply and became relatively flat for the remainder of the year. From May 2011 until
Closings By Type and City
City/ DET DET % ATT ATT % %County Sold Sold Change Sold Sold Change Total Total Change
2010 2011 10-11 2010 2011 10-11 2010 2011 10-11CHES 1840 1907 3.64% 339 371 9.44% 2179 2278 4.54%CURR 27 44 62.96% 0 0 0.00% 27 44 62.96%GLOC 212 235 10.85% 7 6 -14.29% 219 241 10.05%HAMP 958 999 4.28% 122 112 -8.20% 1080 1111 2.87%IWC 204 237 16.18% 32 24 -25.00% 236 261 10.59%JCC 368 407 10.60% 77 70 -9.09% 445 477 7.19%MATC 19 28 47.37% 0 1 0.00% 19 29 52.63%NNEW 1112 1173 5.49% 234 273 16.67% 1346 1446 7.43%NORF 1539 1764 14.62% 212 289 36.32% 1751 2053 17.25%POQ 71 85 19.72% 10 7 -30.00% 81 92 13.58%PORT 839 925 10.25% 105 91 -13.33% 944 1016 7.63%SUFF 697 690 -1.00% 83 87 4.82% 780 777 -0.38%SURC 24 29 20.83% 0 0 0.00% 24 29 20.83%VBCH 3028 3003 -0.83% 1640 1643 0.18% 4668 4646 -0.47%WMBG 32 37 15.63% 23 22 -4.35% 55 59 7.27%YORK 345 355 2.90% 114 103 -9.65% 459 458 -0.22%Totals 11315 11918 5.33% 2998 3099 3.37% 14313 15017 4.92%
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662012 Hampton Roads Real Estate Market Review
2012 R E S I D E N T I A L
December 2011, the percentage of closed existing home sales comprised by distressed homes ranged from 29% to34%, as measured on a monthly basis.
The high percentage of distressed existing home sales when compared to all existing home sales continued to have anegative impact on the overall median sale price of existing homes in the region. The lower median sale price of exist-ing distressed homes of $130,000 for 2011 was $84,000 less than the median sale price for existing non-distressedhomes. This contributed downward pressure on the market’s overall median sale price for existing homes. At $214,000,the median sale price of non-distressed homes saw a $6,000 decline from 2010, negating the $5,000 increase seenthe year prior.
The average number of days an existing home spent on the market before closing in 2011 was 101 days, an increaseof two weeks when compared to the 2010 average of 87 days. Despite the statistic’s susceptibility to manipulation, theaverage is the highest historically since tracking began and has more than tripled since the lowest average of 26 dayson the market in 2004. The average days on market has climbed an average of 10 days per year since 2004.
As 2011 ended and 2012 progresses, there are early signs of growth in the existing homes real estate market ofHampton Roads. The rising trends in closings during the fourth quarter of 2011 and the sharp rise of homes under con-tract in December 2011 show promise in the beginning stages of 2012. The key leading indicator of under contractsales showed a significant jump of 21% in December 2011 when compared to December 2010. In comparison, therewas a similar rise, though not as pronounced, at the end of 2010 leading into a strong first quarter in 2011 and, ulti-mately, a strong year. Although it is likely that not all of the contracts written in December 2011 will become closed exist-ing sales, those that do close, should turn into a solid base for growth in the existing residential real estate market ofHampton Roads in 2012.
Closings Concentration 2011
15%3%
2%
7%
2%
3%
10%
14%1%7%
5%
0%
31%
0% 0%
0%
VBCH
WMBG
YORK
CHES
CURR
GLOC
HAMP
IWC
JCC
MATC
NNEW
NORF
POQ
PORT
SUFF
SURC
20
12
RE
SID
EN
TIA
L
ABOUT THE DATA:
The underlying data the resale home closing statistics are based upon is the col-
lection of those closings belonging to Real Estate Information Network, Inc. (REIN)
members only. The data for each sales transaction was input by hand and therefore may
contain some errors at the individual home sale level. But, as a collection, this data rep-
resents the timeliest and most accurate dataset of resale homes for the entire Hampton
Roads region.
The strength of the dataset lies within its proximity to origin and depth. The MLS
(Multiple Listing Service) data is considered the deepest of any resale home database
due to the sheer number of rich data fields within the database and the information con-
tained within. The information is also being keyed by either the actual listing agent or
administrative staff of the same real estate firm. The combination of these two key ele-
ments allows the MLS data to be more precise than many other information reposito-
ries and vastly timelier.
But, MLS data does have weaknesses. Most notably is the portion of the dataset
at the edges of the MLS’s boundaries. Usually, MLS membership wanes around the bor-
ders of the coverage area, due to overlapping MLSes. In such overlap areas, any given
real estate broker may choose to join only one of the two or more MLSes that cover the
particular area. For the local MSA and the region covered by REIN, this translates into
less than ideal accountability for sales in North Carolina, Northern Neck areas of
Virginia, and the Williamsburg area.
As for REIN, it is an independent MLS owned by broker stockholder members.
Currently, there are approximately 500 real estate firms with over 5,800 real estate
agents serving the entire Hampton Roads region.
67
RESIDENTIAL SUBMARKETS(NEW CONSTRUCTION)
SouthsideChesapeakeFranklin/SouthamptonIsle of Wight CoNorfolkPortsmouthSuffolkVirginia Beach
PeninsulaGloucesterHamptonJames City CountyNewport NewsYork County
RESIDENTIAL SUBMARKETS (EXISTING HOMES)
SouthsideChesapeakeCurrituckIsle of Wight CoNorfolkPortsmouthSuffolkSurryVirginia Beach
PeninsulaGloucesterHamptonJames City CountyMatthews Newport NewsYork County
To Franklin andSouthampton