Richmond Housing Is Still Moving. And the Mortgage Box Is Getting Bigger.
- Paul Cantor
- Aug 31
- 3 min read
As we head toward the fall market, it’s easy to assume higher mortgage rates have brought housing to a crawl.
The local numbers tell a different story.
I pulled the latest Central Virginia MLS data this morning. For single-family homes across the MLS in July:
Median days on market was just 11 days.
Average price per square foot reached $237 — up 3.5% from a year ago.
Different neighborhoods and price ranges tell different stories, but the bigger picture is clear:
Our local housing market remains remarkably resilient.
That’s especially interesting considering mortgage rates. Mortgage News Daily’s daily rate index ended Friday with the average top-tier 30-year fixed rate at 6.81%, near the upper end of its range over the past year.
Yet prices haven’t collapsed, and good homes can still move quickly. For many buyers, simply waiting for everything to become cheaper hasn’t necessarily been a winning strategy.
But there’s another change happening that gets much less attention.
The Mortgage Box Is Getting Bigger
Most people think qualifying for a mortgage looks something like this:
Show your W-2s.Provide your tax returns.Verify your income.Get a conventional mortgage.
For millions of borrowers, that’s exactly how it works.
But financially strong borrowers don’t always fit neatly into that box.
In July, non-QM mortgages accounted for more than 10% of mortgage rate-lock volume nationally for the first time. Add jumbo loans, and nonconforming mortgages represented more than 20% of rate-lock activity.
Why?
Because the way people earn income and build wealth doesn’t always fit traditional mortgage underwriting.
A business owner may have strong cash flow while legitimately taking deductions that reduce taxable income.
A real-estate investor may own profitable properties while having tax returns that don’t fully reflect the strength of the portfolio.
Someone approaching retirement may have substantial assets but little traditional employment income.
Sometimes the borrower isn’t financially weak. We’re simply measuring their financial strength the wrong way.
There May Be Another Way to Look at the Numbers
Depending on the situation, today’s mortgage market may allow us to consider bank statements, assets, 1099 income or other alternative ways of documenting a borrower’s ability to repay.
For real-estate investors, DSCR financing may allow us to focus on a rental property’s cash flow rather than qualifying primarily from the investor’s personal income.
That can change the conversation from:
“Does your tax return qualify you?”
to:
“Does the property and the financing strategy make financial sense?”
These programs aren’t shortcuts around responsible lending, and they aren’t right for everyone. Rates, down payments, reserves and other requirements may differ from conventional financing.
But for the right borrower, they can solve a problem that a conventional mortgage can’t.
What Does This Mean for Richmond Buyers?
Our local market is still moving, even with mortgage rates near the higher end of their recent range. At the same time, the mortgage market is expanding the ways some borrowers can demonstrate financial strength.
So whether you’re buying a home, building a real-estate portfolio or wondering whether your finances allow you to make your next move:
Don’t start by assuming what you can or can’t qualify for.
Start with the goal. Then figure out the smartest way to finance it.
Sometimes the answer really is:
“You can’t qualify right now.”
But sometimes it’s:
“We’ve been trying to qualify you the wrong way.”
Have a great week,
Paul Cantor
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