Roanoke Valley Real Estate | A Market Worth Watching

It’s no secret that the Roanoke Valley is a wonderful place to live. Its scenic mountain views, numerous outdoor activities and less hectic lifestyle has made this area a hotspot for younger generations just starting out, to retirees looking for a quiet place to call home after finishing up long careers. Perhaps the most important draw for people in the area is the low cost of living and the affordability of real estate. The average home price in Roanoke is $133,000, 28 percent below the national average. With all the positive changes that have occurred in Roanoke in the past few years, now may be a great time to take that next step towards owning a home.

A city expanding
Roanoke is a growing city with a workforce that is increasing in number each year. Botetourt County has made successful efforts in recruiting companies to either relocate to the area or expand their current business. Its location along Interstate 81, proximity to prestigious universities and lower taxes have proven to be a great reason to have a business in Roanoke. The Virginia Tech/Carillion Heath Sciences and Technology Campus is a major source of growth for the city. By 2020 it plans to employ 3,147 people—an increase of 85 percent over those currently employed. A boom in new breweries has also contributed to the city’s expansion—the area’s high water quality boosts beer production—and the popularity of outdoor lifestyles enjoyed by locals has bolstered the craft culture. Breweries are promoting their businesses as not to be missed after a day-long hiking, paddling and cycling adventures. The city is promoting a lifestyle to go along with that new job you may be considering in the area. According to Kit Hale, Managing Partner at MKB Realtors in Roanoke, “The Roanoke region is doing a nice job of promoting our area as an outdoor destination. Resources like Roanoke Outside Foundation, Go Outside Festival and efforts by the Roanoke Regional Chamber are focusing on our beautiful valley and surrounding areas.” Walter Grewe, Certified Residential Specialist at Long and Foster Realty agrees, saying “Roanoke is becoming known more and more for its quality of life for residents of all ages.” Ultimately, this growth and development has encouraged a variety of people to call Roanoke home and created new housing demand that enlivens the overall state of the housing market.

Your house is getting ready to go on the market, or perhaps it’s been on the market for several weeks. HOME shares comments from local real estate professionals as they divulge the top three things buyers are looking for in their home search, as well as the three issues buyers complain about when they tour homes on the market.
buyers want
Cyndi Fletcher, Berkshire Hathaway HomeServices, REALTORS

• EVERYTHING renovated!
• Good schools.
• Outdoor living spaces, i.e., porch, deck or patio a must!

Amy Cullen, MKB Realtors

• Location.
• Spacious kitchen/living area for family and entertaining.
• Move-in ready.

Scott Avis, MKB Realtors

• Updated/new kitchen.
• Updated/new master bath.
• Outdoor living/entertaining space.

Bill Gearhart, Coldwell Banker

• Convenient location.
• Low maintenance.
• Modern amenities.

Susan Bailey, Long & Foster Realty

• Location! Good schools, close to workplace, vibrant neighborhood.
• Condition: Everything is done—turn key!
• Price: Buyers want a good value.

buyers’ complaints
Cyndi Fletcher, Berkshire Hathaway HomeServices, REALTORS

• Kitchen and bath upgrades are not done.
• Small bedrooms.
• Small closets.

Amy Cullen, MKB Realtors

• Inventory is low. (It’s a good time to be a seller!)
• Homes are disorganized, cluttered and not market-ready.
• Appliances are old and outdated, possibly requiring maintenance or replacement.

Scott Avis, MKB Realtors

• Lack of renovation.
• Not enough modern/open space.
• Lack of yard and outdoor living space is problematic.

Bill Gearhart, Coldwell Banker

• Low inventory.
• Low inventory.
• Low inventory.

Susan Bailey, Long & Foster Realty

• Wallpaper and paint colors: Buyers want it neutral.
• Furnishings look tired and exhausted, therefore, the house does too.
• Bathrooms not updated, if not, buyers see dollar signs.

What buyers want
Demand in Roanoke is centered around urban living, says Hale. “Young people are gravitating towards older neighborhoods where walkability and socialization are prevalent. Whether it’s downtown living or areas like Raleigh Court, Grandin Court or the Daleville Town Center, I believe the demand will continue to be more focused on densely populated areas of our region,” attracting the attention of an important group of buyers to the market this year—the millennials. Hale adds, “We see millennials as having the biggest impact on the market, both in terms of homeownership and driving culture as to house price, mixed-use and mixed density locations and walkability.”
Grewe feels that two other important groups of buyers will have a large impact on the market in 2019 as well—first-time homebuyers and baby boomers. He says, “The ability of first time homebuyers to find homes to purchase and the baby boomers deciding to cash in on the equity they are sitting on and downsize to one-level living, rather than remodeling their current homes and aging in place, will be a factor.” There is already a demand for housing priced between $100,000–200,000 for those first-time buyers, but more homes in the $200,000– 250,000 will allow baby boomers to make a move and feel comfortable doing so. He says “It will also open up inventory in other price ranges, getting more of the folks who are still living in their first home the opportunity for more choices.”
Roanoke is also enjoying a boom in new construction. Like many areas around the country, the housing market collapse triggered a surplus of new homes just sitting on the market. Hale says, “When the market began to recover, new home inventory couldn’t keep up with demand. Local developers are enjoying a robust market.” Although Grewe says new construction is available across all price ranges in the Roanoke Valley, “It is currently focused in the price points above $225,000, with some proposed townhouse and patio home projects in the upper $180,000s to low $200,000s range.”
Roanoke Valley by the numbers
An important and crucial way to gauge the market in any area continues to be home prices and sales of existing homes. In Roanoke, “The average starter home has risen to a price range of $130,000, midrange homes begin at $245,000, with luxury homes starting at $750,000 and going up,” according to Hale. Overall, median sales prices seem to have risen in the past few years. In 2017 the average price of a home sold in Roanoke was $180,000; in 2018 it rose to $217,465. Sales of existing homes were up two percent in 2018 which shows that people are taking that risk and entering the market. Also relevant to demand, the average time on the market for homes has decreased by nearly 16 percent in 2018.
All of these factors contribute to a healthy market, but perhaps the most important factor is the presence of inventory. Hale comments that as home prices increase, inventory will increase. But Roanoke has a healthy absorption of 4.34 months. “We don’t suffer lack of inventory like many areas of Virginia and around the country,” says Hale. Grewe adds, “The only price points where we see any surplus are in the luxury market—homes priced at $750,000 and above.” A healthy market also has a higher inventory of affordable single-family homes. In Roanoke in 2018, 733 homes were sold in the $200,000–245,000 range. Hopefully, as we move into 2019, inventory will be on the rise in all price ranges as more and more people decide to list their homes for sale.
Buying or selling—is now your time?
Whether you are a first time home buyer, a seasoned seller looking for a change or a retiree looking to downsize, there is a place for you in the Roanoke real estate market. Now may be the perfect time to make a change, but before you do, enlist the help of our local experts. The Roanoke Valley has many qualified real estate professionals, builders and relocation experts ready and willing to make your next move as easy and painless as possible. ✦