New Kent housing market showing signs of recovery

New Kent’s housing market is on the upswing, at least according to statistics released by the Virginia Association of Realtors and the Central Virginia Regional Multiple Listing Service (MLS). But those same statistics show that a buyer’s market still holds in the county.

When the economy began to tank in 2008, sale prices on single family houses plummeted. But after bottoming out in 2010, prices have been on a slow but steady rebound. In 2011 in New Kent, house sales totaled 155. Last year, the sales figure rose to 226, the largest statistical increase in the Richmond area.

And although a slight dip occurred in average sales prices from 2011 to 2012, New Kent is exhibiting significant positive growth, said Kathy Diradour, who represents both the realtor and MLS groups. Diradour revealed the promising statistics to county supervisors during the board’s Monday meeting. Those statistics, however, reflect the Richmond region only and do not include the Williamsburg MLS, which overlaps into New Kent.

“New Kent’s market is beginning to show positive activity, and that’s what we’re looking for,” she told the board.

Average selling price for a New Kent house in 2011 reached almost $242,000. In 2012, the figure fell to just over $235,000, but Diradour said the good news is a downward trend in inventory of houses on the market.

As of early this month, New Kent has 209 active listings and is averaging 19 sales per month.

“New Kent has 11 months of [housing] inventory supply,” she said. “We want to see that drop because it shows there’s still a buyer’s market in New Kent.”

Five months inventory or less is preferable, she said. Listings in New Kent remain on the market an average of 85 days compared to 60 days for the rest of the Richmond metro area, she added.

Construction figures in New Kent, meanwhile, have exhibited more dramatic growth. New single family houses sold rose from 38 in 2001 to 68 in 2012. Pending sales also showed improvement from 55 to 65.

“That’s pretty good growth,” Diradour said, adding that the county can “expect to see prices increase at a moderate rate.”

Foreclosures in New Kent, meanwhile, have totaled 191 since the market declined, but there are only nine active at the present time.

“The positives are that our market shows slow recovery, prices continue to increase, there’s lower inventory than in the past, and New Kent is right in there,” Diradour told the board. “Looking at the numbers, New Kent is doing quite well.”

But there are obstacles remaining, and topping the list are tight credit and regulatory agency uncertainty, she said.

“A lot of transactions don’t get through because they can’t be underwritten,” she said, although interest rates continue to remain low.

“If we can get lending under control, we will move toward a full recovery,” she said.

Under questioning from supervisors. Diradour said she does not expect the current mortgage interest deduction on taxes to go away if or when Congress gets around to revising the country’s tax code. Deductions for second homes could be doomed, she said, adding, however, that both are still on the table.