What is in store for the New River Valley, Virginia Tech, and Radford real estate markets in 2020?
Whether you are an investor looking to buy or sell, a VT parent looking for student housing, or a NRV resident looking to get into a new home, you are probably wondering, “What is the market going to do in 2020?” Have we seen the top of the real estate bubble or will the seller’s market we have experienced this past few years continue? After researching local & national stats and consulting with local experts, here is a sense of what you can expect in the year to come in the New River Valley’s real estate market in 2020.
The Bottom Line: Low mortgage rates, a growing economy, and lack of properties for sale will see home prices continue to rise in 2020 - potentially leveling off at the end of the year as new construction begins to even out buyer demand.
Key Stats comparing year end 2018 and 2019 in the NRV:
7.4% decline in the number of properties listed for sale
4.8% increase in the number of closed sales
15.9% decrease in the days a property is on the market for sale before it goes under contract
4.5% increase in sale price
What this means: There are less homes for sale, but the properties that go on the market are selling for higher prices in less time.
“We expect about one in four offers to face bidding wars in 2020 compared to only one in 10 in 2019,” - Fairweather.
What is causing this trend:
The NRV is growing. The economy is healthy. Virginia Tech is enrolling more students and creating more jobs both at the university and ever-expanding Corporate Research Center.
Investors who have ridden the market all the way up are looking for stable markets to invest their nest eggs.
Parents of college students, worried that their child might not have housing, are competing for the few properties that are available.
New developments on the horizon in the NRV:
Area homebuilders are hard at work with new construction in the area. Predictions are that new inventory coming on the market starting later this year will start to even out what has been a very strong seller’s market.
What this means for …
… Property Owners (especially around Virginia Tech campus):
Expect the value of your property to continue to increase through the year
No one can time the market, but do not be surprised if values peak later this year with the new inventory hitting the market.
Conclusion: Now is a good time to sell to take advantage of a spring market with historically low inventory.
… Home Buyers:
Even with elevated property prices, continued low interest rates could make now a good time to buy.
Know your goals. Property will continue to be valuable in the NRV and will appreciate over time. If you are buying with a longer time horizon, even if we are near the top of the market, you will still be investing in a desirable area where home price will rise over time.
If you can wait … it could be worth waiting for new construction to come online later this year and in 2021 to see if the new inventory starts to level off prices.
… Investors
Cash is king: with the competition to get into properties in the NRV, more investment properties are selling for cash with no home inspections than normal. If you are able, consider a cash offer that you later finance as this might give you the leverage you need to get the deal done.
Buy for appreciation in Blacksburg. Buy for cash flow in Christiansburg and Radford. Blacksburg investment properties offer a stable environment where there will never be a lack of tenants … and you will pay for that. If you desire cash flow in the path of progress, consider investing in Christiansburg or Radford.
Conclusion: It is possible that early 2020 will be a peak time for sellers in the NRV - especially investment properties in Blacksburg and Christiansburg.
It is my pleasure to help property owners, investors, and homebuyers to buy and sell properties in the New River Valley.
I would love the chance to meet with you to help you determine what your property is worth and to talk about your home buying goals. Schedule a free, no commitment meeting with me by clicking here or give me a call anytime (978) 473-0587.