Since 2010 onward, West Virginia has slowly bounced back from being one of the two worst economies nationwide. The state finally pulled out of its slump. Housing markets braced for a long sought after recovery. Meanwhile, the state held the second lowest number of foreclosures which provided endurance for West Virginia real estate. Morgantown was among the first cities to generate a demand in housing after the financial crisis. Forbes ranked Morgantown as the #10 best small city in the nation to conduct business back in 2010. Places like Fairmont proved to be one of the most stable markets nationwide. These numbers still don’t resolve the high unemployment in the state or the high rate of poverty. But, West Virginia University students renting temporary homes in Morgantown and retirees moving to different cities in the state thanks to affordable housing appear to keep things in balance.
Fast forward to the 2013 West Virginia housing market. The state ranked first with an 8.6 percent increase in home prices. Rising rent prices and a proportional growing number of renters (along with low mortgage rates, attractive investment options to generate job growth, and positive economic trends) should prove to be key factors towards the recovery of the West Virginia real estate. The West Virginia housing market continues growing thanks to affordable home prices. Let’s see if the housing inventory shortage has been resolved by new construction in the residential sector and if housing affordability remains as before.
Influencing Factors of the 2015 West Virginia Real Estate
According to Fannie Mae’s National Housing Survey from March 2015, an all-time high 46 percent of people interviewed consider this time to be a good time to sell. Combine that with the incredibly low interest rates, growth in home prices, and a decrease in the cost of down payments. This equates to a ton of potential for West Virginia. The state does not differ from overall national predictions.
- West Virginia remains extremely affordable at this point. With home values declining by 14.6% through 2014, the median home value in the state sits at a comfortable $90,700. Homes in areas such as Clarksburg may hold values at or less than $65,400. Of course, Charleston has a higher median home value of $162,400. We expect a 0.3% rise this year. What’s more, NeighborhoodScout reports West Virginia’s appreciation rate at 2.83% for the past 12 months.
- Labor market contraction and mixed household conditions resulted in a somewhat downbeat West Virginia economy. Despite these downturns, the state market still showed some signs of improvement.
- The state offers plenty of natural amenities/resource: four enjoyable, outdoor seasons along with diverse options for hobby seekers. These options vary from hunting, recreational caving, scientific research, beautiful mountain scenery, idyllic rivers, historically significant coal mining, and logging industries. WV also balances these natural features with vibrant metropolitan cities. The moment investors pull these strengths together, West Virginia begins offer so much more. Fayetteville serves as one particular example. Fayetteville is one of the nation’s top rated small towns. The city established New River Gorge Preserve as a community with a goal to balance luxurious living while still preserving the natural habitat. Buyers will typically invest between $80,000 to $600,000 for home sites. Prices for cottages start at $225,000 and $300,000 for full homes.
- The Charleston West Virginia real estate market serves as another example of growing opportunities. Since 2005, Charleston West Virginia real estate officials have worked on the redevelopment of the city’s riverfront with the goal of making the city an attractive place to live and work, as well as a tourist destination. The natural consequences of this evolution automatically spur economic growth in the area.
Real estate typically correlates with employment. The employment market saw a 0.3 percent increase in February thanks to utilities, trade and transportation industries. These domains added about 400 jobs. The logging and mining industry in West Virginia accounted for the largest job loss of about 900 positions. Compared to the same time last year, payroll employment expanded by 2.3 percent in West Virginia. This rate was driven by a growth of 5.2 percent in the business services and professional industry.
West Virginia issued 207 new residential permits at the beginning of this year. This number represents a huge increase compared to the time period of winter 2014 through January 2015. Most of the permits were issued by the Charleston MSA. Overall, home values appreciated through February 2014 except for the Huntington and Morgantown area.
Development firms are currently constructing single and multi-family homes in Kanawha, Putnam and Cabell counties. Realtors expect this trend to continue through the year if things remain steady.
As realtor.com® Chief Economist Jonathan Smoke forecasts, millenials are the buyers who will generate about more than two-thirds of the household growth between now through 2020. This generation outnumbers the baby boomers. Basically, these individuals and their choices will influence real estate as well as the upcoming housing market. Given that most older residents choose to buy a house and move to West Virginia to benefit from the lower cost of living, this generates a low employment rate as most seniors have already retired. It seems that younger Americans are leaving the state in mass, searching for a better future and jobs elsewhere. If millennials choose other states, the decrease of younger demographics in West Virginia may affect the housing market.
According to our housing market predictions, it seems that West Virginia might benefit from some investments which would generate employment and positively affect the real estate in the area. Despite the shortcomings of this market, we predict relative stability for the real estate market in West Virginia (assuming no severe events occur in the weather or economy that would disrupt the flow that is slowly putting the state on a financial uptick). There might be some improvements or setbacks, but we cannot predict anything out of the ordinary.
We should also examine the land for sale in WV. This factor also influences the area and its real estate. Investors might catch interest for a new building lot in the state. Americans might just as well plan ahead in order to ensure a future weekend getaway or simply acquire a recreational or investment property. West Virginia’s land is diverse and can fulfill a wide range of needs for different buyers. Parcels vary in size and price depending on the type of land and construction of the domain. For an example, out of the thousands of listings on specific land transaction sites, 10 acres are currently available for $30,000. This listing includes a stream, field and trees. That doesn’t mean that one cannot find pricy posh properties in West Virginia’s countryside.
If demographic factors don’t surprise us in the near future with who-knows-what kind of newly established community needs among the first home buyers and if hopefully people get to stick to their jobs in West Virginia, we predict at least a plateau for the near future, with no hectic changes. We forecast a minor, but welcomed increase in the interest for the real estate of the state if metropolitan areas keep expanding as local governors intend.