Let me take an example: the house "2505 Windy Pines Bend, Virginia Beach VA 23456" is listed at $475,000. This house was bought in 2004 for $375,000 & $275,000 in 2001. Realisitically, this house should be priced at $350,000 at this stage & may be even less in future. Correct me if I am wrong.
Va Beach has participated in the house price rally (stands 11th across the nation in terms of price increase), but now when the prices are moving down in the rest of the country, the prices are pretty constant here.
I guess only time will tell.
I will caution you though, waiting for the prices to drop and intersect with low interest rates may be a gamble. A change in interest rates can make a HUGE difference in your monthly mortgage payment, it can make or break you. Right now realistic sellers know that competition is fierce and the market dictates closing cost assistance in some shape or form. I would seriously consider buying while rates are lower and sellers are motivated to make it work.
Chris Faircloth had a good answer for your question. There are nearly 12,000 homes for sale in the Hampton Roads area (which Virginia Beach is a part of). The question of home prices goes back to supply and demand. As long as we have more homes for sale than we have willing buyers, there's a good chance the prices will continue to drop gradually. Tougher lending practices do not really affect home prices, unless they are so tight no one can get a loan which would cause standing inventory to rise even higher. I don't see a quick turnaround (near future) in the current supply and demand mode we are in, and I can't predict what the market will do in a year or so.
Another thing to consider as Chris pointed out is the interest rates. Typically when the economy is good, interest rates are low, but when the economy sours, interest rates start to climb. I'm currently looking to refinance my mortgage, so I'm keeping a close eye on the rates right now. I'm hoping they will drop here shortly, but I'm not going to risk waiting very long. The rates are still pretty good, but I have doubts that the economy will get better in the short run, so the rates won't come down much if they do at all.
Wainwright Real Estate