After a peak in the spring of 2022, median sale prices in the DMV generally underwent a period of modest decline, attributed to a series of Fed rate increases and broader economic uncertainty. The data from Q2 of 2023 suggest that decline may be reverting to the longer term upward trend. How can that be?
Upward pressure on prices has come from resilient demand and very low supply, with the number of active listings in the DMV down 20% from 2022 and more than 50% from 2019. Looking forward, projected decreases in mortgage rates will likely result in pent-up buyer demand returning to the market, increasing competition for homes. Upward pressure on prices is also coming from the large population bulge of millennials entering the age of first-time home buying and eventually move-up buying.
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