May 19, 2020 | Josh Sullivan
April’s market performance indicates the effect of COVID-19 has finally reached the DC Metro real estate market. Home sales were down 19% across all property types and jurisdictions for the region last month, while pending sales dropped 31.1% compared to April of 2019. Contrary to what you may expect, the dip in sales has had little effect on home prices, continuing to post a YoY increase of 6.7% for the month of April, reaching a median sales price of $507,000. Although active sellers weren’t budging when it came to negotiations, a considerable number of sellers have seemingly delayed the listing of their homes, as evidenced by the 37.4% decrease in new listings for April.
The District, Arlington County and Fairfax County each experienced market trends similar to that of the greater market – a slight increase in median sales price coupled with a steep decline in settlements. DC saw the greatest decline in sales at 29.8%, with Arlington and Fairfax close behind with a decrease of 25.4% and 20.4%, respectively. All property types were equally plagued with the decrease in sales activity, suggesting product at all price-points experienced at least some deviation from what was expected in a typical spring market.
Though both closings and listings have dropped amid concerns of COVID-19, each day there are more and more encouraging signs of a speedy return to normalcy. Many of our builder & developer clients are continuing to forge ahead and have seen little discouragement on the construction side. We view the drop in sales as only temporary, coinciding with an initial visceral reaction to the virus that we’re already beginning to see dissipate. Consumer confidence is beginning to return to the marketplace and things that were once on “pause” have begun to resume slowly. We expect the past two months of volatility in the residential market to quickly settle as well, followed by a wave of pent-up demand that is long overdue to be relieved.