As we close out 2024, it's time to look back at what actually happened in our Central Virginia real estate market versus what we expected at the start of the year. I wrote a market forecast back in January, and I want to be honest about what I got right, what surprised me, and what it all means as we head into 2025.
The Mortgage Rate Story: Stubbornly High
Let's start with the biggest factor that shaped 2024: mortgage rates. In January, I wrote that rates would likely stay in the high 6s to low 7s for at least the first half of the year, with potential for relief in the second half. The reality? Rates stayed in the high 6s to low 7s for essentially the entire year. The Federal Reserve did begin cutting its benchmark rate in September, but mortgage rates didn't respond as dramatically as many homebuyers and industry observers had hoped.
For most of 2024, a conventional 30-year fixed mortgage hovered between 6.5% and 7.2%. That persistent rate environment continued to shape every aspect of our market:
- Suppressed inventory: Homeowners with sub-4% mortgages continued to resist selling, maintaining the "lock-in effect" that's constrained supply since 2022
- Reduced affordability: Monthly payments on a median-priced home in Bedford County ($350,000-$380,000) remained 40-50% higher than they would have been at 2021 rates
- Buyer adjustment: By mid-2024, most serious buyers had accepted the rate reality and stopped "waiting for rates to drop." Those who bought earlier in the year are already seeing appreciation gains that offset the higher rate.
County-by-County 2024 Performance
Here's how the major markets in Central Virginia performed this year:
| Area | 2024 Median Price | YoY Change | Avg Days on Market | Property Tax (per $100) |
|---|---|---|---|---|
| Bedford County | $365,000 | +4.3% | 28 | $0.53 |
| Lynchburg City | $268,000 | +5.1% | 24 | Varies |
| Roanoke City | $282,000 | +4.8% | 26 | Varies |
| Franklin County | $310,000 | +3.6% | 32 | $0.43 |
| Campbell County | $262,000 | +4.0% | 30 | $0.73 |
| Pittsylvania County | $228,000 | +6.2% | 35 | $0.63 |
| Nelson County | $320,000 | +3.9% | 38 | $0.63 |
| Amherst County | $255,000 | +3.5% | 33 | $0.63 |
| Appomattox County | $248,000 | +3.2% | 36 | $0.43 |
Key Takeaways from the Data
Pittsylvania County led in appreciation at 6.2%. This was the Caesars Virginia effect in action. The full resort's late 2024 opening, with its 1,300 permanent jobs and 500-room hotel, drove housing demand across the greater Danville/Pittsylvania area. Investors who bought in Pittsylvania early in 2024 are sitting on meaningful gains, and I expect this trend to continue into 2025 as the resort reaches full operational capacity.
Lynchburg City outperformed many predictions at 5.1%. The city's combination of walkable neighborhoods, university-driven rental demand, and relative affordability made it a magnet for both owner-occupants and investors. The $250,000-$280,000 median range keeps Lynchburg accessible to first-time buyers, even at elevated mortgage rates.
Bedford County remained the region's premium market at $365,000 median. The combination of Jefferson Forest schools, Smith Mountain Lake access, Forest's convenience, and the county's low $0.53 tax rate continues to make Bedford the top choice for families and retirees relocating from higher-cost areas.
Seasonal Patterns Held True
One prediction I'm pleased to say was right on the money: seasonal patterns. The 2024 market followed the same cadence we see every year in Central Virginia:
- January-February: Slowest months. Average days on market stretched to 45 in January, and prices were at their annual low. Buyers who took advantage of this window got the best deals of the year.
- March-May: The spring surge. Listings increased, buyer activity spiked, and the spring premium of 5-7% over winter prices held. Sellers who listed in April and early May captured peak demand.
- June: Peak month. Highest prices and fastest sales, with the average home going under contract in approximately 25 days. Multiple-offer situations were most common in June, especially for well-priced homes in the Jefferson Forest school zone and near Smith Mountain Lake.
- July-August: Strong but slightly cooled from June's peak. The summer market remained active, driven by families wanting to settle before the school year.
- September-October: A reliable fall mini-surge. Relocating buyers and investors who'd been watching the market all year made their moves.
- November-December: The seasonal slowdown, though not as dramatic as some years. Motivated sellers who priced correctly still found buyers, particularly in the under-$300,000 price range.
Inventory: The Gradual Thaw
Inventory improved in 2024 compared to the extreme lows of 2023, but the improvement was modest. We saw approximately 15-20% more active listings in 2024 than in 2023, which sounds significant until you realize that 2023 was one of the lowest-inventory years in modern Central Virginia real estate history.
We're still in a seller's market by historical standards. Months of supply (the time it would take to sell all active listings at the current sales pace) hovered around 2.5-3.5 months for most of the year in Bedford County and Lynchburg. A balanced market is typically 5-6 months of supply. Until we get back to that level, sellers maintain leverage, particularly for well-maintained, correctly priced homes.
Buyer Profile: Who Bought in Central Virginia in 2024
Here's what I observed in my own practice and across the broader market this year:
First-Time Buyers
First-time buyers remained active throughout 2024, leaning heavily on financing programs to overcome the rate challenge:
- FHA loans (3.5% down) remained the most popular first-time buyer product in our market
- VA loans (zero down) were significant, reflecting our region's military and veteran population
- VHDA programs provided down payment assistance that made the difference for many buyers
- USDA Rural Development loans (zero down) qualified for properties in Bedford County, Franklin County, and Amherst County, giving rural buyers an edge
Relocators
Remote workers and retirees from Northern Virginia, DC, New York, and New England continued to discover Central Virginia's value proposition. I wrote about the $500,000 comparison in February, and the message resonated all year. Buyers selling a $700,000 townhouse in Fairfax County could purchase a $450,000 home on acreage in Bedford County, pocket $200,000+ in equity, and reduce their monthly costs significantly.
Investors
Investment activity was strong, particularly in three segments:
- Smith Mountain Lake short-term rentals: Despite navigating county-by-county permitting (Bedford CUP, Franklin SUP + business license, Pittsylvania zoning permit), investors continued to acquire lakefront and lake-access properties for Airbnb/VRBO operation
- Lynchburg long-term rentals: The city's university population and affordable entry prices attracted buy-and-hold investors
- Pittsylvania County: Caesars-driven demand created opportunities for both rental and flip investors at entry prices well below the regional median
The Smith Mountain Lake Market
Smith Mountain Lake deserves its own section because it operates somewhat independently from the broader Central Virginia market. Waterfront homes on SML continued to perform well in 2024, with direct waterfront properties (those with docks and deep water access) seeing 5-8% appreciation. The highest-end segment ($1 million+) was slightly softer, with longer days on market, as the rate environment made luxury financing more expensive.
The communities around the lake each maintained their character:
- The Waterfront: Ultra-exclusive, with the championship golf course and country club continuing to attract affluent buyers
- Bernard's Landing: Strong condo market with resort amenities and good rental income potential
- Westlake Corner: The commercial hub of SML, with restaurants, shops, and convenient access to the lake
- Moneta/Hardy corridor: Solid middle market with a mix of lake access and non-waterfront homes at accessible prices
What I Got Wrong in January
I try to be transparent, so here's where my January forecast missed:
- Rate relief timeline: I said rates might reach the high 5s to low 6s by Q4 if the Fed followed through on cuts. While the Fed did cut, mortgage rates didn't drop as far as hoped. We ended the year closer to 6.5-6.8%, not the sub-6% many had hoped for.
- Inventory surge magnitude: I predicted 15-20% more listings than 2023. The actual improvement was at the lower end of that range in most counties, and in some months, inventory was flat compared to the prior year.
- Pittsylvania County underestimated: I flagged Pittsylvania as a best-value area, but I underestimated the speed and magnitude of the Caesars effect on housing demand. The 6.2% appreciation was the strongest in the region.
Looking Ahead to 2025
I'll publish a detailed 2025 forecast in January, but here are my preliminary thoughts:
- Rates: Expect gradual improvement, potentially reaching the low-to-mid 6% range by mid-2025. The Fed's direction favors lower rates, but the pace will be slow.
- Prices: Continued modest appreciation of 3-5% across most areas. No bubble, no crash. Central Virginia's fundamentals are strong.
- Inventory: Should continue to gradually improve as life events force more homeowners to sell, and as new construction (particularly in Bedford County and the Lynchburg metro) adds supply.
- Hot areas to watch: Pittsylvania County (Caesars momentum), Forest/Bedford County (perennial strength), and Lynchburg City (affordability-driven demand)
- Buyer's advice: If you can afford to buy in 2025, do it. Prices are not coming down. Rates are more likely to decrease (creating a refinance opportunity) than increase. Waiting has a cost, and in Central Virginia, that cost is measured in appreciation you missed.
Thank You for a Great Year
To every buyer, seller, and investor I worked with in 2024: thank you. This business is built on trust, and I never take it for granted that you chose The Realty Group Team to guide one of the biggest financial decisions of your life. Our team is committed to knowing this market better than anyone, and we're excited about what 2025 has in store.
If you're thinking about making a move in 2025, now is the time to start the conversation. Whether you're buying your first home, selling a property, investing in a rental, or relocating from out of state, we have the knowledge, the experience, and the genuine love for Central Virginia to help you succeed.
Happy holidays from our team to you and yours. Here's to a wonderful 2025.
Teresa Grant is the Team Lead of The Realty Group Team at Keller Williams in Central Virginia. Start your 2025 real estate journey at therealtygrouponline.com.