The crash of the residential real estate market is making itself felt locally as described in an article in today's Virginian Pilot (http://hamptonroads.com/2007/12/number-unsold-homes-region-highest-decade). While the figures are very bad locally, they are even worse in many markets around the country. If this situation continues, many real estate related businesses will either shrink considerably or go out of business. Here are some story highlights:
More than five times as many homes are for sale in Hampton Roads now as were on the market during the heady days of the real estate boom in 2004, and the excess inventory is showing no sign of shrinking anytime soon.
As 2007 winds down, an estimated 23,500 existing single-family, detached homes are unsold in greater Hampton Roads, from the Peninsula to northeast North Carolina, according to the Real Estate Information Network Inc. and the Old Dominion University Economic Forecasting Project. In 2000, the inventory of unsold homes was 8,475. It dropped steadily to a low of 3,480 in 2003 but has been growing rapidly ever since.
Though the prevalence of so-called "subprime" mortgages in Hampton Roads is not believed to be as big a problem as in other parts of the country, there has been a ripple effect locally as national lenders have tightened their standards considerably. With credit harder to obtain, more houses are staying on the market longer - especially the more expensive ones.