At 15 Days, DC Metro Sees Lowest Median DOM Since 2005

Double-digit sales growth for condos and townhomes; single-family home sales drop; Low inventory continues to push up prices, DC posts highest median price on record

OVERVIEW

Signs of spring are in the air, and the DC Metro housing market continues to pick up steam. Sales and median prices are up from this time last year, and days-on-market is at its lowest level in over seven years. The low inventory of homes for sale continues to play a major role in the market. Active listings have dropped by nearly 20,000 since their fall 2007 peak, and the proportion of townhome listings is now the lowest on record. Interestingly the trend of rising sales and declining new contracts has continued in the region.

This could reflect that fewer contracts are failing to settle, which may be a direct result of fewer bank-mediated properties in the market. Median sales price growth remains strong through most of the region, and the median price for the District of Columbia is the highest on record. Despite the rising prices, sellers remain cautious as evidenced by the drop in new listings. Lingering economic uncertainty likely remains an issue for many, and the low inventory of available properties could be deterring many would-be sellers from moving.

Click here to view PDF version of this report

CLOSED SALES

The spring market kicks into gear, up from last year; Double-digit growth for condos and townhomes. There were 3,569 sales in March in the Washington DC Metro Region, 6.7 percent higher than this time last year. Sales jumped by 33.0 percent from last month, but this is in line with seasonal patterns. The condo market continues to post the strongest sales growth of all property segments, up 17.0 percent from last March. There were 1,011 condo sales this month, the highest March total in six years for the region. Townhomes also saw double-digit sales growth, rising 10.4 percent from last year. Single-family detached homes fell slightly, down 0.7 percent from last year, a drop in 11 sales. The lower price points are likely playing a role in the condo sales growth. Condos are attractive to many first-time homebuyers and empty nesters looking to downsize, which continues to fuel the demand.

PRICES

Low inventory continues to push up prices for most of the region; Highest median sale price for DC on record. At $372,500, the median sale price in the Washington DC Metro Region is 8.0 percent higher than this time last year, and the highest March median price in five years. The low inventory of active listings continues to put upward pressure on prices around the region. Once again, single-family detached homes led all property segments in median price growth, up 12.0 percent from March 2012, a gain of $50,000. The median sale price for townhomes is up 10.6 percent from last March, an increase of $35,000. The median price for condos rose 3.4 percent, a gain of $9,050. At the jurisdiction level, median price growth continues to be strong. Falls Church City led in terms of the rate of growth up 37.7 percent from last year. Notably, the median sales price in the District of Columbia rose 13.6 percent to $460,000, which represents the highest median price on record for the city.  Alexandria City also posted strong median price growth, rising 24.4 percent from March 2012. The year-to-date median sales price for the region as a whole went from $325,000 to $355,950, a gain of 9.5 percent.

NEW CONTRACTS

New contracts continue to fall relative to last year, single-family detached homes driving the trend. There were 5,377 new contracts in March in the DC Metro Region, down 5.2 percent from this time last year, and the sharpest year-over-year drop in two years. New contract activity rose 25.7 percent from last month, but this is in line with seasonal patterns. This is the fourth year-over-year decline in five months for new contracts. Single-family homes which account for nearly half of all new contracts in any given month are driving the overall decline, falling 10.3 percent from last year. New contracts on townhomes and condos remained relatively steady. Townhomes are up 0.8 percent from this time last year, and condos fell a mere 0.1 percent, a decline of one contract. The recent trend of increasing sales and declining new contracts could indicate that fewer contracts are failing to settle compared to last year. This could be a result of fewer bank-mediated properties in the market.

INVENTORY

Low inventory continues across the region, lowest proportion of townhome listings on record. There were 6,289 active listings in the DC Metro Region at the end of March, a drop of over 4,200 listings from last year. The inventory shortage continues to impact all property segments, with active listings down over 40 percent across the board relative to last year. Townhomes continue to have the lowest supply, accounting for only 15.8 percent of all listings in the region, which is the lowest proportion on record with data available back to 1997. The subtle signs of improvement in new listings that occurred last month have faded. There were 5,817 new listings in March, 15.8 percent lower than last March. New listings rose 28.1 percent from last month, but this is well below the 10-year average February-to-March change for the region of +41.1 percent. This could highlight lingering uncertainty with sellers despite the rising sales prices. It could also reflect that many sellers decided to list their properties earlier than typical seasonal patterns. The low inventory continues to drive down the median days on market, which at 15 days is 26 days lower than March 2012, and is the lowest of any month since September 2005. The average sale-to-list price ratio continues to climb, up to 97.6 percent, the highest ratio for the DC Metro Region in nearly seven years.

About the RBI Metro Housing Market Update

The DC Metro Area Housing Market Update provides unique insights into the state of the current housing market by measuring the number of new pending sales, trends by home characteristics, and key indicators through the most recent month compiled directly from Multiple Listing Service (MLS) data in RBI’s proprietary database. The bulk of this report’s content is readily available, down to the ZIP code level of granularity, via interactive charts and reports offered via rbiEXPERT, a premium subscription service offered to real estate professionals interested in growing their business with the help of industry-leading and user-friendly analytics. The DC Metro Area housing market includes: Washington, D.C., Montgomery County and Prince George’s County in Maryland, and Alexandria City, Arlington County, Fairfax County, Fairfax City, and Falls Church City in Virginia.