The September data for the DMV real estate market are in. What do they show? Is the market heating up or cooling down? Here are the highlights:
- Supply is up. The number of active listings on the market in September was up about 19% from September of 2023. That said, the market is far from flooded, and inventory is still down about 50% from 2019.
- Demand us up. Properties that moved from being for sale to being under contract increased by almost 16% in September compared to the same time last year. We're also seeing an increase in showing activity, which was up by about 6%.
- Price is up. The median sales price for September is about 9% higher than in September of 2023.
What do we think is driving these trends? A major factor is decreasing mortgage rates. The rate for a 30-year fixed rate mortgage is down about 2% from the 2023 high of nearly 8.5% in October of 2023. To put that in context, for someone buying a $1M home with 20% down, that 2% lower rate reduces their monthly payment by more than $1,000. That means purchasing power is increasing. Incidentally, it also means that for some people it could be a good time to refinance. (Let us know if you need recommendations for good local lenders who can help you take stock of your current purchasing power and/or whether the time is right to refinance.) Another important factor driving prices is the constrained inventory. Even though supply has increased relative to this time last year, it's still very constrained, meaning buyers are competing for a relatively small number of properties, which tends to drive prices up.
As we look to the future, mortgage market experts are generally forecasting further declines in mortgage rates in the coming months. We're also expecting to see an increase in the number of buyers and sellers entering the market.
For a deeper dive into the market in your neighborhood, please contact me and/or review the market reports below.
Maryland
Frederick County Market Report
Montgomery County Market Report
Northern Virginia
Arlington County Market Report
Washington, DC
