As DC Area Home Sales Set Records in May, Inventory Drops

• June 10, 2016

by Nena Perry-Brown

Last month, home sales in the DC area reached ten-year highs for the month of May, according to the latest monthly analysis from RealEstate Business Intelligence released on Friday.

The 5,432 sales that closed during the month are a 12.3 percent increase from last year, and represent the 18th consecutive month that closed sales increased year-over-year. Perhaps more notably, the level of closed sales in May was the second-highest for any month since August 2006. The number of new sales contracts also increased by 3.7 percent year-over-year to set a new record for the month of May.

Meanwhile, the 7,436 new listings that hit the market last month represent a 10 percent drop from last May and a 15.6 percent decrease from last month. Active listings in the region declined year-over-year to 11,072, the first time that inventory has dropped on an annual basis since September 2013.

The drop in inventory held across all categories — listings of single-family homes fell 12.8 percent and condo listings dropped 4 percent. DC proper was the only jurisdiction in the area where inventories actually increased.

Real estate watchers in the DC area felt that housing inventory would turn negative at some point this year. In February, RBI’s Elliott Eisenberg predicted that the cyclical nature would be the cause and pinpointed almost the exact month when it would happen.

“I do not know if it will be in April or May or June, but I bet it will happen by mid-year,” Eisenberg said, anticipating that the cycle of negative inventory could last for 18 months.

RBI defines the DC metropolitan area as including: 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.

This article originally published at http://dc.urbanturf.com/articles/blog/dc-area_home_sales_set_all-may_highs_while_inventory_dips/11344