Virginia is one of those states in the U.S. with a very rich history and lovely scenery to accompany it. The school system is top-notch and home to some of the best universities. Additionally, it’s conveniently located to Washington DC. Virginia is one of the best places to settle in or invest in. Whether you want to live close to the beach or the mountains, you can take in the picturesque scenery year round.
Virginia’s economy has stayed resilient through economic crises. At the moment, the state’s real estate market is positioned for continued growth. Virginia has relatively high standards of living coupled with a corresponding high per capita median household income.
The income is much more than the national average, which balances the high standard of living in many ways. Finding good realtors in Norfolk, VA will put you ahead of other investors as you study the investment patterns in the state. It always helps to consult an expert.
Factors Affecting Investment in Virginia’s Real Estate
Virginia’s thriving economy catapults it to the top of most investors’ lists. However, as attractive as the area is, it is still necessary to carefully consider all the factors to decide if they align with your personal investment goals for both the short and long term. This will help you form a clearer idea of the kind of things that may affect your ROI. This is where professional realtors in Virginia come in. They have their fingers on the pulse of local real estate markets and can guide you to the most profitable investment opportunities.
Taking all these factors into consideration may make an investor sit back and think about the viability of Virginia’s real estate market. Thankfully, most of the present factors indicate that Virginia is a good location for real estate investment. Here’s why:
Virginia’s Powerful Tech Industry
Virginia was one of the first states to incorporate tech into its economy. It has steadily maintained one of the country’s highest concentrations of tech workers over the years. Because of the state’s value in the tech industry, it is regarded as the best state for investors and businesses by several publications, including Forbes.
The workforce consists of a large percentage of well-paid, educated individuals. From an investor’s standpoint, this means more empowered buyers in the housing market. As a result, the demand for houses steadily paces the increase in home prices.
Any serious investor would consider the purchasing power of the target customers. There’s no point in investment if your target client base will be unable to purchase your product. The strong tech presence in Virginia forecasts a growing economy, which directly affects the wages of workers and their ability to buy or rent homes.
Taxes Are Fair
In addition to the booming economy, Virginia runs on a moderate tax and income system. The income of workers in the state is directly proportional to the rate of taxes. Those who are in the lower income brackets are only required to pay 2% tax rates. However, wealthier households pay a higher rate.
The corresponding property taxes are much lower than the national average, and they are also very considerate of retirees. Retirement taxes in Virginia are very friendly and do not operate like other states where social security is taxed.
Sometimes, income and property taxes stand between an individual and home ownership. Thankfully, the fair tax system in Virginia creates an environment where individuals have higher purchasing power and can go after properties or rentals of their own. This is a positive sign for prospective real estate investors.
Home Prices Exceed the National Average with Possibility of Increase
The home values in Virginia have gradually appreciated over the last decade. While this is good news for homeowners, the higher prices make it a bit harder to break into the market. First-time buyers may be confronted with prices that are higher than the national average. At the end of 2022, Virginia had a median home value of $365,000, as opposed to the national median home value, which was $328,745.
There are expectations that the home value will continue to increase in 2023. As a result, investors in the Virginia real estate market now have a high chance of making profits as the years go by. It’s only a matter of economics. As long as the purchasing power of residents remains high, investors will most likely be smiling at the bank in the coming decades.
Rent Prices Overtake the National Average
Currently, the median rent in Virginia is $1,940. While less than the national average, the rental market still will provide a positive ROI. For many real estate investors, the rent in the target location has to be a priority. It is one of those things that should be studied before a decision is made regarding investment, as it determines how fast you get your ROI. A place like Virginia with higher rent prices is an indication of fast profits for savvy investors. These are things you discover with proper research and the help of a professional realtor.
What Markets are Best for Investment in Virginia?
The whole of Virginia is an excellent choice for real estate investment, but there are a few choice locations that have advantages over others. Cities like Virginia Beach, Arlington, Norfolk, Richmond, and Chesapeake are some of the best cities to invest in their real estate because of their high population. Richmond’s population growth in the past decade has been one of the fastest in the U.S. A lot of the growing neighborhoods in Richmond, like Lakeside and Scott’s Addition, are also excellent places to invest in real estate in Virginia.