DC Metro housing market starts strong in 2015

January home prices, contracts and closed sales up over 2014 levels

Rockville, MD – (February 10, 2015) – The following analysis of the Washington, D.C. Metro Area housing market has been prepared by Elliot Eisenberg, Ph.D. of RealEstate Business Intelligence (RBI) and is based on January 2015 MRIS housing data.

OVERVIEW

The Washington DC Metro housing market started 2015 on a good note, with increases in sales, prices, new contracts and inventories compared to January 2014.  Closed sales increased by 4.5% from January 2014, and all property segments increased year-over-year.  While single-family detached prices remained flat at $450,000, townhomes and condos increased by 1.4% and 4.7% respectively.

The number of new contracts increased 6.2% from January 2014, reaching their highest January-level since 2011 at 3,720, just slightly above the five-year average of 3,715, but well above the ten-year average of 3,516.  Inventories are up 18% compared to January 2014, with all categories experiencing double-digit increases.  Inventories remain slightly below the five-year trend, but roughly 50% below the ten-year trend of 12,635.  Relatedly, average days on market are up, increasing by 10 days compared to January 2014, but remain below the five-year January trend of 70 days and the ten-year trend of 79 days.  Pending sales are up by 6%, and should result in good sales leading into the prime spring buying season.

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CLOSED SALES

Year-over-year sales increase, all property segments enjoy boost.  For the second month in a row, closed sales increased year-over-year, rising by 4.5% or by 110 sales.  There were a total of 2,554 sales, the highest January since 2010.  This is also the first time since October of 2013 that there have been two consecutive months of year-over-year increases, and for only the second January since 2010, all categories are up on a year-to-year basis.

Last month, single-family detached homes once again led all property segments in growth and increased 5.2% compared to January 2014.  Townhome sales increased by 4.2% and condo sales increased by 3.6% versus last January.   Not surprisingly, when compared to December 2014, the number of total sales decreased, as January is almost always a slow sales month.  Total sales declined by 35% month-over-month, slightly more than the historical average of 29%. 

NEW CONTRACTS

Contract activity rises for third straight month, highest January in four years.  The number of new contracts increased 6.2% from January of 2014, for a total of 3,720.  New contracts have now risen year-over-year for three consecutive months and January contracts are at the third-highest level since January 2007.  All property segments, except for condos, had more contracts signed this January than last, with townhomes leading the way with a 9.6% increase, or 89 units.  The number of new contracts for single-family detached homes increased by 8.5%, or 135 contracts compared to January 2014.  Contracts for condo properties were the weakest performing sector, though they declined by less than 1% or just 8 units.  The month-over-month increase in new contracts was 16.54%, very much in line with the 10-year average of 18.9%.

PRICES

Overall January sale prices at highest level since 2007, condo prices rising fastest.  The median sale price in January in the DC Metro Area was $385,000.  Between January 2014 and January 2015, the median sale price increased by 4.1%, or $15,000, bringing the overall median to its highest January level since 2007.   Condo sales led with a 4.7% increase ($13,000) over January 2014 and are now at $292,000.  At $450,000, the median price for a single-family detached home was unchanged.   The median sale price for townhomes jumped 1.4%, or $5,050 to a new median price of $375,000.  Single-family detached homes are at the highest January level since 2008, townhomes and condos are at the highest January level since 2007.

Most jurisdictions in the region showed increases in median sales prices except for Fairfax City and Montgomery County.  The highest increase in median sales price was in Falls Church City, which experienced a 46% increase to $569,500, although the limited number of sales (9) makes the data overly sensitive to changes.  Fairfax County saw a 4.1% increase in the number of sales compared to January 2014 and had a 3.1% increase in median sales price to $439,000.  Montgomery County had a 2.4% increase in the number of sales but experienced a slight 1.2% decline in median sales price to $370,500.  Prince Georges County showed a 5.6% increase in the number of sales coupled with an 11.3% increase in median sales price to $217,000.  Washington DC had a slight 1.7% decrease in the number of sales, but prices rose 5.3% to a median sales price of $495,000.  Alexandria City had a 40% increase in the number of sales and the median price rose 6.9% to $463,750.  Arlington County saw a 10% increase in volume and a 4.2% increase in the median price to $520,000.  Fairfax City saw declines in both volume (-15.8%) and in median price, down 9% to $417,500.

INVENTORIES

Inventories and days-on-market continue to rise, townhome inventories rise fastest.  Active listings continue to rise and have now increased from the prior year for 16 consecutive months.  There were 7,949 active listings at the end of January, which is nearly an 18% increase from last January.  This is the first time inventory has increased for all housing types for more than a 12 month period since February 2007.  Continuing a trend starting in June 2014, active townhome listings continue to have the highest percentage increase in the number of listings.  Active listings for single-family detached grew by 15.3%, or 566 listings.  Townhomes increased by 22.6%, or 277 listings, and condo listings increased by 20% or 361 listings. 

There were also more new listings in January 2015 compared to January 2014, with an overall increase of 180 new listings, or an increase of 4.4%.  New listings for townhomes increased by the largest percentage, at 4.7% or 47 units, followed by single-family detached which increased by 4.5% or 84 units, while condos increased by 4.1% or 49 units.  This is the first increase in the number of new condo listings in four months.

At 45 days, the median days-on-market (DOM) increased by 13 days and is one day higher than the five-year January average of 44, but eight days lower than the 10-year average of 53 days.  The current median DOM of 45 days is the highest reached in any month since February 2012.

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 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. 

About RealEstate Business Intelligence, LLC

RealEstate Business Intelligence, LLC (RBI) is a primary source of real estate data, analytics and business intelligence for real estate professionals in the Mid-Atlantic Region. Monthly reports for all jurisdictions in the MRIS region, along with interactive charts and graphics, can be found at http://www.getsmartcharts.com/statistics. RBI is the only company in the Mid-Atlantic region that provides timely, online access to statistical information directly from the MRIS MLS.

About Elliot Eisenberg

Elliot Eisenberg, Ph.D. is a nationally acclaimed economist and public speaker specializing in making the arcana and minutia of economics fun, relevant and educational. Dr. Eisenberg earned a B.A. in economics with first class honors from McGill University in Montreal, as well as a Masters and Ph.D. in public administration from Syracuse University. Eisenberg, formerly a Senior Economist with the National Association of Home Builders in Washington, D.C., is a frequent speaker on topics including: economic forecasts, economic impact of industries such as homebuilding and tourism, consequences of government regulation, strategic business development and other current economic issues. He is a regularly featured guest on cable news programs, talk and public radio, writes a syndicated column and authors a daily 70 word commentary on the economy that is available at www.econ70.com.