November 16, 2016 | Josh Sullivan
Over the past few months we have seen a steady growth for sales price in the DC metro area, but it seems prices are beginning to plateau.
Median Sales Price Growth Slows Down for DC Metro
October’s median sale price for the DC Metro was $400,000, only a 0.3% improvement over last October. This is most likely the cause of appreciation and depreciation within each sub-market of the DC Metro. Prices appreciated in almost every sub-market, except Arlington County which depreciated 9%. It is evident that since the end of the great recession, sale prices have begun to level off at around $400,000 for October.
While prices stagnate, supply continues to decrease with only 10,393 active listings. Though inventory level is the lowest we’ve seen since 2012, sales were at the highest level in seven years for October. Closed sales across all property types totaled 3,970, a 2.6% increase from October 2015. It looks like flat prices and low supply cannot curb the ever-increasing DC housing demand.
The median sale price for Washington D.C. in October was $543,000, rising 1.5% from $535,000 in September. This was also a 5.6% increase compared to last October’s median sale price of $514,000. Though this was an increase month-over-month, it is evident that the market is cooling off from a smoking hot summer.
Although sales level for the DC Metro are at their highest levels in seven years for October, we are still seeing a decline from the summer peak. Only 630 homes were sold this past October, the lowest we’ve seen since February of this year. The majority of those sales were made up of condos/coops and townhouses, accounting for 49% and 37% respectively. The remaining 14% was made up of detached single-family residences.
Arlington County, VA
For Arlington County, October’s median sale price reached $497,000, dropping 2.9% from $512,000 in September. Like Alexandria City, Arlington also saw a significant decrease compared to last October’s figures. Last year’s median sales price was 8.8% higher at $545,000.
Arlington County sales for October improved to 237 closings, compared to 218 closings in September. The vast majority of sales were concentrated within condos/coops at 57%, which makes sense for the metropolitan sub-market. Townhouses accounted for the smallest majority with only 8%.
Alexandria City, VA
In Alexandria, the trend is more evident. The median sale price for October was $442,000, dropping 1.2% from $447,000 in September. The downward trend is more severe when looking at last October’s median sale price of $495,000. Since Alexandria City is a smaller market, the figures are more apt to fluctuate more drastically than some of the other counties.
Alexandria City closed 158 sales, again showing a decelerating market for this time of year. Condos/coops accounted for 53% of sales in Alexandria City, while townhouse and detached homes represented 29% and 18%.
Fairfax County’s median sale price stayed almost stagnant month-over-month and year-over-year. For October the median sales price reached $454,000 which was a 1.3% decrease from $460,000 in September and a 1.1% increase from $449,000 last October.
Fairfax County had the highest level of sales across all DC sub-markets with 1,110 closings. This level is right on track with the other markets, showing a slight decline from the peak months of June and July when sales reached 1,600-1,800. Given Fairfax County is much more suburban and residential compared to most of the DC area sub-markets, it comes as no surprise that detached single-family homes accounted for the majority of sales. Single-family houses accounted for 46% of sales, while townhouses and condos/coops made up 32% and 22% respectively.
Although each sub-market carries its own unique attributes, they all seem to follow the same pattern. We’ve experienced a record-setting summer, followed by an equally impressive fall exceeding our expectations. The market is heavily demand-driven and shows no signs of stopping any time soon.