By Diana McFarland

Managing editor

While sales of new houses are generally outpacing existing homes in Isle of Wight County, many millennials are going for older, smaller homes, according to local real estate and loan professionals.

“Their goal is not to start off in a house that their parents are in now,” said Gwyneth Beaton, a loan officer with Towne Mortgage of younger homebuyers seeking their first purchase.

And that’s just one end of the market. Second time homebuyers are fueling a boom along the Route 17 corridor in Carrollton — in Founder’s Pointe, Eagle Harbor and Benn’s Grant.{mprestriction ids=”1,2,3,4,5,6″}

“That’s where the sales are going crazy,” said Elaine Dow-Hines, a realtor with Berkshire Hathaway in Smithfield.

New home buyers are looking for a different style of house — those with hardy plank exteriors and more natural colors, Hines said, adding that it also appears buyers are coming from Newport News and Hampton where the market is built out and most choices there are of existing homes.

Countywide, sales of existing homes are up 11 percent from last year, and building permits for single family homes were up 42 percent, according to the multiple listing service and the U.S. Census.

In 2015, there were 478 houses sold in Isle of Wight. That jumped to 532 by the end of 2016. Building permits also went up — from 121 in 2015 to 172 in 2016.

The majority of sales are for houses priced from $250,000 to $500,000, according to Hines’ analysis.

However, for those wanting to sell a house priced at less than $250,000, it can likely be sold as soon as they are listed, provided they are in decent shape, said Hines.

“If we had them we could sell them,” she said.

As a result, houses priced up to $250,000 have the shortest inventory, at 3.6 months, compared to houses over $500,000, for which there is an inventory of nearly a year.

Housing values remained flat on average between 2012 and the last reassessment in 2015. The next reassessment is due in 2019.

Hines doesn’t see the sales slacking off in the next few months or even years. But it may be awhile, if ever, if Isle of Wight returns to the heyday of housing sales — when in 2005 there were 534 building permits issued for new single family homes. That was near the height of the housing bubble, which fueled the housing crisis and the subsequent recession. During the dark days of the recession, housing starts dropped to a low of 75 in 2011.

Meanwhile, interest rates started to creep up after the November election and are now ranging from 4.25 to 4.625 percent, depending on the loan type and the borrowers profile, said Beaton.

Millennials are not going for the maximum mortgage they can qualify for, Beaton said, adding that student loan debt is another consideration when pre-qualifying. 

Homeownership is important to them, but they don’t have to have the biggest house in the best neighborhood, she said.

 “They don’t want to be house poor. They want to live.”  {/mprestriction}