April 12, 2018 | Josh Sullivan
Buyers have been putting their foot down in recent months – fewer cash offers, multiple contingencies, and fierce negotiations. The number of sales for the DC Metro fell almost 5% YoY as buyers are patiently awaiting the spring market. Even as interest rates continue to rise, buyers are not conceding to the lack of inventory in the Metro area.
Historically DC proper has been an outlier, often outperforming the rest of the region in terms of closings and sale price, but March was a different story. Median sales price did increase slightly (3.8%YoY) to reach $555,451 for the month, while closings for March declined almost 10% to 708 sales. Closings across all property types saw a drop in activity with detached single-family homes experiencing the brunt of it with a decline of 19% YoY. Townhome and condo sales diminished slightly as well with a decrease of 13.4% and 1.7% respectively.
Arlington County, VA
Arlington’s market activity mirrored that of DC and the rest of the region with a seemingly paradoxical drop in sales and increase in price. The median sales price for March jumped 10% YoY to reach $564,250 while sales activity dropped 7.1% YoY. Though fewer transactions occurred in March, buyers are still willing to pay a premium to be an Arlington resident. A top-notch school system combined with an amenity filled community right across the Potomac from DC makes Arlington one of the most highly sought-after counties in the country.
Fairfax County, VA
Fairfax county continued to follow suit, but in a much less drastic fashion. Both median sale price and sales activity remained largely the same, fluctuating only 1% in either direction. Detached single-family homes experienced the most significant decrease in activity, with 4.6% fewer sales YoY. Closings for townhomes remained flat at 360 transactions for the month of March while condo sales actually improved slightly to produce 273 closings.
The next few months will be very interesting as we have just entered the spring market – this pent-up demand is bound to break free alongside the influx of new inventory. Though sales will increase beyond the current activity for 2018, I expect we won’t see the typical hot spring market we are used to. Inventory woes have made buyers weary, along with rising interest rates and a region-wide backlogged pipeline. I expect these cautionary behaviors to decrease slightly but not diminish completely.