NORFOLK, Va. (WAVY) – If you are in the market for a new home in Hampton Roads, you may need to act fast. Homes are selling without inspections and sometimes sight unseen.

This frantic market movement begs the question: how long will it last? An overview of local real estate demands out-of-town perspective.

Nicole and Kevin Franqui moved to Norfolk just over a year ago from San Diego.

“We realized how much we were spending for an apartment in Southern California, and we started looking at what we could get for a lot cheaper out here,” said Kevin Franqui.

The couple paid $283,000 for their home in Norfolk, sight unseen, and $3000 over the list price, and they have plenty of company.

“It’s the wild wild west out there,” said realtor Taylor Lennox with COVA Collective Realty in Chesapeake. “It’s a multiple offer situation. People having to put in over appraised value. But those people that purchased this time last year could then turn around and sell their properties this year for a really good profit.”

That’s because inventory, or the number of homes for sale, is at historic lows. The Hampton Roads REALTORS Association says our area had only a month and a half supply of homes in November. That’s a 12.5% drop from the same time a year ago. The median price for a single-family home is $300,000, up 6.4%.

“You can sell your house and make a fortune. I don’t care who you are,” said Barbara Gatewood Sgueglia Chairman of the Hampton Roads REALTORS Association. “But where are you going to go?”

For Deb and Brian Kraus of Norfolk, the answer was across town, and it was not an easy journey.

“So you’re talking sight unseen, no inspection, that kind of thing,” said Deb Kraus. “They wanted an offer on the table before you can even get an appointment to see a house.”

They ended up renting for four months. The Kraus’s got their new home when a previous buyer backed out.

So why is the market so hot? Dr. Robert McNab, an economist with Old Dominion University, blames a combination of tight supply and cheap money. “That means that people are out there upscaling, refinancing, buying, who have might not bought in the past because it was cheaper than renting, that will change in the coming year as interest rates rise,” he said.

McNab said you can thank inflation running at a 40-year high for the coming interest rate hikes.

“That’s going to cool the market somewhat, but we are still not building enough housing for the population growth in Hampton Roads, and in Virginia, and in the United States.”

Having a transient military population means there are homes for sale in Hampton Roads, there are just fewer from which to choose.

“I think in the end we got a good deal based on what we would have paid for a house a couple of months later,” said Deb Kraus.

Related Link: HRRA Market Indicators Report | November 2021

As for the infamous “housing bubble” that led to the financial crisis of the late 2000’s, several experts said that came with too many unqualified buyers getting loans they should not have received. They agree, this time the market is driven by not enough supply, and too much demand.