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News and Events • January 9, 2023

Williamsburg Real Estate Market Update for 2022 and a Few Thoughts on 2023

by Ted Evans

Below is the annual letter that I send to my clients with an update on the previous year and what I feel we will see in the Williamsburg area for the upcoming year. If you have specific questions on the local real estate market, please feel free to call/text me at (757) 254-6678 or email tevans@cbwilliamsburg.com.

I hope everyone had wonderfull Holiday Season and wishing all a happy and healthy 2023!    Like all “markets”, the real estate market experiences volatily from time to time.  Historically you can count on an average annual 3% home price appreciation….well 2021 and 2022 improved that average.   And 2023 is looking to give us a bit of a reality check!

Nationwide

  • Case Schiller reports we have had 124 straight months of positive home growth (from Feb. 2012 – June 2022). Now 6 straight negative home growth months.
  • Fortune magazine also adds – from the beginning of the pandemic in March 2020 through October 2022 home prices have increased on average 38% (see local info – page 2 graph)
  • Fed Chairman Powell – “In the long-term supply and demand have to be better aligned so prices can go up at reasonable levels and a reasonable pace.”

What does all that mean for little ‘ole Williamsburg, Virginia are surrounding areas?  I am going to answer this the best I can – realizing I ultimately have little idea what the future holds!!

Locally

  • We have about 125 single family homes for sale – normally in January we have 550-600 homes.
  • Prices here are not rising, they are falling – but not by very much and not at all in some price ranges.
  • We will not see dramtic prices increases in any price range.
  • We still have more demand for homes than supply. But we are not seeing the rush to purchase, buyers waiving inspections, bidding against other purchasers – in other words, maybe getting back to normal!

2023:

  • Economics 101 says commodities in short supply and being chased with high demand leads to price increases. (See graph below of our market’s inventory levels and prices for the past 10 years.)  But Econ 101 is wrong for 2023 in my opinion.  Even with our short supply of single family homes – we are seeing a steadying of the Williamsburg housing market.
  • We are going to see price stabiity in price ranges under $500,000 and price decreases of about 3-5% in the higher prices ranges.
  • I do expect more homes to come available and interest rates to settle into a 5%-6% range.
  • Again – moving towards a normal market for sellers and buyers and providing both with more confidence in their purchase and sale of a home.

As I always say – real estate is local, even down to the neighborhood level – so no matter what you read or hear – please feel free to call me for help and advice on the Williamsburg market.   That’s what I’ve done for the past 20 years and happy to help where I can.

Thank you very much!

Ted Evans, Associate Broker        Coldwell Banker Traditions     Williamsburg VA

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