Year-end Housing Report Shows Low Inventory, High Prices

Interest rates expected to trend down, but prices won’t change significantly, Fredericksburg Area Association of Realtors says.

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by Adele Uphaus
MANAGING EDITOR AND CORRESPONDENT

The Fredericksburg Area Association of Realtors’ year-end housing report shows continued low inventory, low demand, and high prices.

“The real estate market in the Fredericksburg area saw a continuation of low inventory issues in 2023,” said Randy Walther, FAAR president, in a press release accompanying the report, which was released last week. “The start of the year held hope that a stable market would take hold but rising interest rates quickly changed that outlook.”

The total sold dollar volume for 2023 in FAAR’s membership area—Fredericksburg City, the town of Colonial Beach, and Stafford, Spotsylvania, Caroline, King George, and Orange counties—was $2.64 billion, a 21% decrease from 2022.

The median home price was $439,000, up 3% compared to 2022. The total number of units sold last year was 5,531—a 24% decrease.

Homes spent an average of 27 days on the market, a 35% increase over 2022.

Stafford County had the highest median home price in the area last year—$500,000, a 3% increase over 2022. The lowest was $300,000 in Colonial Beach.

The median home price in Fredericksburg was $450,000; in King George, $440,000; in Spotsylvania, $430,000; in Orange, $387,750; and in Caroline, $340,375.

As 2023 progressed, Walther said, would-be sellers “were less inclined to give up a low interest rate loan if they had to assume a new loan at a higher rate.”

He said many buyers “brought funds to the table that allowed them to buy down a new loan or in many cases, they paid cash from the sale of a previous home.”

Walther said interest rates are trending down again from last year.

“As a result, the expectation is that 2024 will see more improvement in the market,” he said.

However, Walther said FAAR “does not expect prices to change significantly anytime soon.” 

“The Fredericksburg region is growing and housing needs will remain a concern,” he said. “This is especially true in the entry level market.”

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