2016 West Virginia Housing Market Uncertain…

Falling Gas Prices, Rising Unemployment Rates, a Hurting Coal Industry:

What Does This all Mean for West Virginia’s Housing Market?

The near year is upon us and with it, our local economy is at a crossroads.

Gasoline prices continue to fall, unemployment rates rise, local population numbers decline and coal mine layoffs increase.

Yea, we smile when it costs only costs us $20 to fill up the tank. But, like anything with the economy, there’s give and take. And West Virginia can only take so much.

Coal is Hurting

Coal. The Mountain State is built on this sustainable energy source.

But, coal prices have fallen by 15 percent since 2015, and coal production is now at its lowest level since the Reagan administration. All this while layoffs and shutdowns continually plague area mines.

When our state’s foundation is shaken this way it creates a domino effect that eventually trickles down to the local housing market.

In his talk about the economy, Gov. Earl Ray Tomblin addressed the downturn in the coal industry.

“We cannot ignore the unprecedented shift that has taken place in our state and our nation,” he said. “Forces beyond our control have severely damaged our coal industry, and even the most optimistic among us realize it is unlikely coal will ever reach production levels of the past.”

Putting it all Together

If West Virginia’s main energy resource continues to suffer then area coal companies lose money, which causes workers to lose jobs, which causes the local economy to lose momentum. In other words, less people will have less money to buy houses.

It’s simple supply and demand. This will drive West Virginia home prices down.

Lawrence Yun, chief economist at the National Association of Realtors., explains:

“Fewer jobs means less home buying demand and that will naturally soften the housing markets in those job-impacted areas,” he said.

Yun practically called out West Virginia with that statement.

Unanswered Questions

Don’t get us wrong, this is great for financially stable home buyers as their dream home becomes more affordable.

But, will there be fewer home buyers in 2016 due to the state’s high unemployment rate?

Will the coal industry make a comeback once the country gains a new president?

These are the questions to answer.

WV Real Estate Photographer Justin Waybright & WV Real Estate Agent Chuck Boggs

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