The housing market in the DC region seems to be on a different trajectory from one month to the next, so as a new report comes out today, UrbanTurf aims to succinctly sum up what is happening.
The February report from Bright MLS shows three dynamics at play right now: low home sales, low inventory and home prices that remain high.
While home sales rose in January, they fell last month thanks to rising interest rates. High rates are not only dampening buyer interest, but they are also making potential sellers reluctant to list their homes.
"Many existing homeowners are sitting out the market because they do not want to have to give up a rock-bottom mortgage rate," the new Bright MLS report stated. "Overall inventory rose from last year, but the number of active listings is still 40% lower than it was in February 2020."
Fewer sellers listing their homes is the primary reason that prices aren't budging. The median price in the area is 1.7% higher compared to a year ago and 20% higher than it was three years ago. DC proper is one of the few places bucking that trend, as prices have fallen in the city for five straight months.
"Buyers who remain in the market are still finding relatively few options, and therefore prices continue to be pushed upward," the report stated. "Although higher mortgage rates have made it more difficult for some buyers, many are bringing significant equity—or cash—to the transaction."
As we enter the spring market, inventory may be the determining factor for where the market goes next. If more homes are listed for sale, buyers will have more options and prices may level off. If sellers remain hesitant, the market will likely not change much in the coming months.
This article originally published at https://dc.urbanturf.com/articles/blog/what_is_happening_in_dc-area_housing_market/20746.
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