A recent report from NBC29 states that Governor Terry McAuliffe is unveiling new plans to strengthen the Virginia economy. A number of analysts have said that economic activity is increasing, but have raised fears that economic stagnation could be on the horizon.
Despite concerns that the economy may be starting to falter, the housing market remains as strong as it’s been all year. The Virginia Association of REALTORS has stated that the housing market is on solid footing moving into 2016. There are still some concerns that the economy could stall, but most data suggests the economic recovery will be sustainable heading into the New Year.
Sales and Prices Rise Steadily
The housing market in Virginia hasn’t been as vibrant as some other regions, but growth has been steady. The VAR reports that median prices rose by 1.54% and sales increased 2.83% year-over-year. The VAR said that this news should be welcome for any citizens concerned about the possibility of an economic downturn.
However, the report cautions that there are a couple of reasons housing sales could decline in the near future. VAR economists said that some people may have been purchasing homes during the final months of 2015 because they wanted to get better deals before the Federal Reserve rose rates. Fed Chairwoman Janet Yellen recently confirmed that rates are going to be raised this month, which could deter some buyers from entering the market in the early months of 2016.
On the other hand, there are also signs that job growth is starting to become stronger in Virginia, which well bode well for the state real estate market. The VAR predicts that stronger job growth is likely to benefit the Virginia housing market. However, the market could slump if job growth in Delaware and other neighboring states proves to be stronger, because it could pull many citizens to those areas.
The biggest factor that could fuel the housing market is a growing need for federal contractors in Virginia. The Northern Virginia Regional Commission said Virginia generates more from revenue from the federal contracting industry than every other state except California. The $51.1 billion the state is generating from federal contracting is helping stimulate the economy, which makes it more attractive to aspiring homeowners. Concrete delivery companies, home re-modelers, etc, are seeing a surge in demand.
Virginia has had plenty of ups and downs over the past year, but the general outlook for the economy appears to be fairly favorable. Housing sales should continue to rise in the coming months if growth meets current expectations.