The Shutdown Effect: A Chill On The October Market

• November 11th

by UrbanTurf Staff

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The effects of the federal government shutdown and broader economic uncertainty filtered into homebuyer and seller behavior across the DC area in October, according to a new report out today.

The report from Bright MLS finds that closed sales across the region were flat compared to last October, while new pending sales rose by just 0.7% year-over-year — modest movement despite mortgage rates hitting a 13-month low. The cautious pace reflects a market that appears to be recalibrating amid fluctuating confidence and limited urgency for buyers.

DC proper was the biggest drag on the regional market, with activity cooling significantly since the summer.

Closed sales in the city fell by 9.3% compared to a year ago, while pending contracts dropped 15.6%. The slowdown follows several months of uneven buyer demand and an uptick in listings, creating conditions where sellers are more likely to wait out uncertainty than rush to market. For many prospective buyers, even slightly lower mortgage rates have not been enough to offset job insecurity and the uncertainty caused by the ongoing shutdown.

Meanwhile, inventory continues to expand across the metro area. At the end of October, there were 10,661 homes for sale — a 34.1% increase from a year earlier. The inventory of homes on the market rose by double-digit percentage points in every local jurisdiction.

Despite the slower market, home prices are actually increasing. The median sales price for the region in October reached $630,000, up 5% year-over-year, with higher-end buyers driving much of that growth. In the District, the median price climbed a more modest 2.3%, suggesting that the luxury segment is sustaining overall price gains even as transaction volume slows.

“While the DC area housing market has been fairly resilient, we are definitely seeing some cracks,” Dr. Lisa Sturtevant, Bright MLS Chief Economist, said. “If the shutdown persists and if federal workers do not get back pay, we will see a much slower housing market in the region in November and December.”

This article originally published at https://dc.urbanturf.com/articles/blog/the_shutdown_effect_on_the_october_market/24057.