Virginia’s real estate market has surged abnormally rapidly throughout 2021. According to Neighborhood Scout, home values appreciated 13.6% from Q3 2020 to Q3 2021, a significant surge that is put in perspective by how it stands out amongst the typical appreciation rate for the state. Across the last ten years, including 2021’s abnormally high appreciation rate, the average annual rate is 3.81%.
Homes remain mostly affordable in Virginia. The median home value is $330,186, and 45% of homes in the state cost between $126,000 and $378,000. However, 2021 was a major year of price surging that represented a frenzied state of affairs on the market. Let’s look at some of the defining trends of the past year in the Virginia real estate market as we enter 2022.
“Zoom Towns” Surrounding Richmond Experience Massive Surge
Work from home has changed the game across the country. It has shifted the balance of power in the hierarchy of cities in the nation, as people no longer have to live where they work. This has led to a serious surge in the value of homes in “zoom towns.” This is a new term that describes spacious suburbs that have attracted many buyers from bigger cities. Richmond is Virginia’s capital, and many of the suburbs surrounding it have experienced huge surges in the past couple of years due to the pandemic.
Several suburbs of Richmond have experienced rapid growth in the near two years since the pandemic began. According to a Forbes report, there are several examples of this. Highland Springs is a suburb of Richmond, whose home value has surged over 50% in the past two years. Hopewell is another suburb whose home prices have increased just under 50%. Colonial Heights is located due south of Richmond, and its home prices have surged 42.6%. These are only some of the several examples of suburbs in the area that have achieved abnormal real estate price surges since the pandemic began.
Virginia Beach a Rising Market
Virginia Beach is the biggest city in the state, located on its southeastern corner with sandy shores and sparkling, blue Atlantic waters. It is a popular vacation spot with surfing, a boardwalk, and great historical hotspots, but it is also a rising real estate market with a growing economy. According to Roofstock, Virginia Beach ranked #1 in the country last year for having the lowest median days on the market, with homes rapidly being swept away.
One of the reasons for the desirability of Virginia Beach is its status as a growing economic power in the area. The same report from Roofstock showed that the employment rate of Virginia Beach grew 2.7% in 2021, and household incomes grew 5.7%. There is more wealth and jobs in the area and, combined with low inventory, these factors are fueling rising housing costs. Home values increased 14.1% over the last year, with a median home sale price of $345,000. It is a rapidly growing market in a growing city with an emerging economy that buyers are flocking to.
What Does 2022 Hold?
Virginia is a microcosm of the ongoing real estate situation in America overall. There is a shortage of inventory across the nation, fueling rising prices and increased competition for listings. People are migrating to areas surrounding big cities, and secondary cities like Virginia Beach are receiving interest due to cheaper real estate and more spacious settings.
Predicting the future can be a difficult exercise, as there is no way to know for certain what will happen, especially amid a pandemic that shows no signs of slowing down. But it is clear that Virginia is a hot market, with several desirable areas attracting buyer attention, and 2022 will likely continue the trend of growth in the state.
