Richmond Area Market Value Analysis (MVA)

Analysis of Richmond Area Housing Market Reveals Important Trends for Residents, Policymakers and Investors

Background

In 2017, the  first MVA for the Richmond Region  was completed by the  Richmond Memorial Health Foundation  (RMHF). It was part of RMHF's portfolio of activities associated with the Robert Wood Johnson Foundation-funded  Invest Health  program.

The 2017 MVA was ultimately incorporated into the award-winning  Richmond 300 Master Plan . That plan recommended updating the MVA every few years.

In 2021, RMHF partnered with  PlanRVA  to conduct a second MVA. The project was completed in 2022 and the results can be seen in the sections below. This project was guided by a steering committee of representatives from around the region who committed themselves to improving the relevancy of the MVA in work across the region and to provide sense of reliability in the data.

Steering Committee Members 

MVA Defined

A Market Value Analysis (MVA) is an in-depth analysis and mapping of a community's housing market. Done at a small geographic scale, it is able to reveal the mosaic of market conditions within a community. It typically uses local and administrative data, and includes field validation and input from local experts.

The MVA was created by the  Reinvestment Fund , a nonprofit organization that uses financial and analytical tools to ensure everyone has access to essential opportunities. The first MVA was done in Philadelphia, Pennsylvania. Since then, several other communities across the United States have conducted MVAs, including Richmond, Virginia.

2022 MVA Process

Market Clusters

The MVA uses a technique known as cluster analysis to form distinct clusters with common market characteristics. Conditions within the same cluster are similar, but they can be very different from conditions in other clusters. Each cluster is identified by a letter of the alphabet in the table below, along with specific market statistics.

Market Characteristics

Affordability

Investor Purchases

Displacement Risk

The Displacement Risk Ratio (DRR) is calculated by taking the ratio between median sales prices over time and the income of a long-term resident at a fixed point in time (2010) and annually adjusted using the Consumer Price Index.

High or rising DRR values signal longtime residents, or new residents with incomes like those of legacy residents, may be experiencing displacement pressure associated with elevated housing prices.

Negative or declining DRR values indicate that housing prices are not keeping pace with larger market trends, which in weak or fragile markets may signal housing market decline.

Next Steps

Now that the MVA is complete, it’s time for stakeholders to do the blocking and tackling to ensure it is fully accessible and integrated into the planning and implementation of the many community-focused efforts around the region.

First, the MVA will find a home at PlanRVA. Thanks to funding from  Virginia Housing , the MVA will be available as an interactive map and over the next few months, a series of map-centric, issue-focused illustrations will be created.

Second, RMHF has committed to making the MVA and component data available to practitioner, academic, and other user-groups who can enhance their research with it.

Third, there is a plan to develop a set of traditional and social media features of the MVA and some of the novel local uses – and uses in other communities across the US that also have MVAs.

Fourth, RMHF will be actively looking for presentation and engagement opportunities around the region with groups of practitioners and policymakers for whom the MVA can be a critical tool.

Lastly, Reinvestment Fund is planning a  Community of Practice  in the southeast region in late 2022/early 2023 that will include opportunities for MVA users from across the country to collaborate on implementation successes and challenges.

Resources