The State Of The Market – April 2008

Continuing the theme from last month, movement in individual segments of the market but really no change in the market overall – despite MAJOR slowdowns in Dublin and Radford.  March moved 133 properties to closing, while April increased that number to 141 properties that closed, yet overall the market stayed almost dead even with the previous month – 11.61 months of inventory, very much a buyer’s market right now.  The numbers bear out what we are feeling on the street right now … increases in market time has led to numbers of homes for sale increasing, with very little improvement overall across the entire sector.  Something to keep an eye on.  Again, we’re looking at how long it would take to sell the existing
residential inventory in a particular area, if nothing else came on the
market until supply was exhausted.  Anything over 5 months is typically
a buyers’ market, and anything less than 5 months is typically a
seller’s market.

Area Active    Sold      Absorption Rate    Buyer/Seller Market 
Blacksburg 247 26 9.5 Months Buyer
Christiansburg 314 40 7.85 Months Buyer
Montgomery County 79 8 9.8 Months Buyer
Floyd County 86 10 8.6 Months Buyer
Giles County 56 11 5.09 Months Balanced
Pulaski 114 15 7.6 Months Buyer
Dublin 120 7 17.14 Months Buyer
Radford 109 4 27.25 Months Buyer

This month, I wanted to dig into the story a little bit more and see how the market was doing versus last year at this time, so I’ve compared home sales and average sales prices in April 2007 and April 2008, as well as home sales and average sales prices YTD in 2007 and 2008.  The results were surprising …

Apr 08 Sales April 07 Sales   Change  2008 YTD 2007 YTD   Change   
Home Sales       141        176    – 20%      514       560     – 8%
Average Sales Price    $193042     $187450    + 3%   $185215   $188664     – 2%

While interest rates are still very low, values in the New River Valley have fallen slightly since last year at this time, while they ROSE in April.  I was expecting that they would have risen by 2% or so for the year, not fallen by 2%.  Still, I’m confident that there’s not a slippery slope in the market here, although I’m no economist by any means. 

This doesn’t mean that there’s a bubble waiting to burst here in the New River Valley.  I think the larger picture here is that the New River Valley is seeing those pockets – Blacksburg condos, Christiansburg townhomes, for instance – starting to adjust to normal levels.  Once the market has balanced out, we’ll see positive growth again … and I think we’ll see that sooner than later!


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