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Washington, D.C. Metro Area Market Summary: Q3 2017

In our quarterly market summaries, we review the most recent available data on the D.C. Metro area’s real estate market performance.

We focus on the following metrics:

Sales
Prices
Inventory
Property Type Performance

Unless otherwise cited, we refer to data compiled by Real Estate Business Intelligence.

We will present a summary of the key facts by analyzing this data, as well as provide a digest of why this data—and our up-to-date market conditions—mean for you.

Sales

In the D.C. Metro area, total sales volume dropped 2.2% year-over-year, landing close to $2 billion.

New contracts increased 2.5% year-over-year, to hit 4,809. However, this September’s new contracts were still higher than both the 5-year and 10-year average for the area (of 4,559 and 4,166).

Closed sales decreased 3.4% compared to last year, at 4,040. Yet closed sales also remained higher than both the 5-year and 10-year September averages (of 3,912 and 3,688, respectively).

Media days-on-market for a property was 20 this September, 4 days faster than in September 2016. So far, in 2017 the area’s days-on-market is down 5 days year-over-year

Sales Summary: Overall, demand is increasing. While total sales volume dropped slightly year-over-year in September, it was up in both July and August. For 2017, the market’s sales slowed slightly compared to the first half of the year, but remain well above our area’s 5-year and 10-year averages.

Inventory

Active listings decreased 1.8% since last September (to 10,903). September was the 17th month in a row our market experienced a decline in year-over-year inventory levels.

New listings were up 2.8% year-over-year. This is mixed news. New listings hit their highest September levels in a decade, but continued to decline month-over-month all quarter.

Inventory Summary: We’re beginning to see the impact of the previous year’s high levels of development as a crop of new development comes online. However, this new supply is still not enough to match demand, as overall levels continue to decline, and remain tight.

Price

July, August, and September each saw decade-high monthly prices.

Median home sales prices increased year-over-year every month of Q3, with September 2017’s prices increasing 1.3% over September 2016’s prices. September was the 12th month in a row that prices increased year-over-year.

Price Summary: Our market’s rapidly increasing prices—that continue to hit decades-long records—demonstrate that our demand continues to significantly outpace our supply (and that this won’t be corrected anytime soon).

Property Type Performance

The data segments sales into three property types—Townhouses, Condos, and Single-Family Detached Units.

Townhouses remain in high demand, yet did not over-perform as they usually do. Year-over-year prices did not move in any significant manner. Sales dropped a significant 6.1% as inventories increased 1.1%. Townhouses continued to sell briskly though, with a median-days-on-market of only 14 days.

Single-family detached units also delivered mixed results. Prices increased a sharp 5.3% and inventories dropped 2.6%. Closed sales were down 1.7% year-over-year, and these properties experienced the longest median days-on-market of 24 days.

The condo market appears to be responding to significant new inventory entering the market. Prices decreased 5.2% and sales dropped 3.4%. Listings were up 6.8%, though overall inventories dropped 2.3% year-over-year. Condos experienced a median days-on-market of 20 days.

Property Type Performance Summary: Each property type experienced mixed performance, and no single property type out-performed the others in any significant manner.

2017 Q3 Summary: What These Data Mean for You

As a whole, D.C.’s housing market slowed in Q3.

But is this slight slow-down do to any new weakness in the market?

Unlikely. These data seem to suggest a relative slow-down that only appears “soft” compared to the breakneck speed our market has been performing at. The market still hit 5-year and 10-year highs in a number of important areas of activity. And the fundamental driver of our market’s hot streak—low supply compared to high demand—remains intact.

However, we recognize it can be challenging to interpret market data—especially when different metrics are moving in different directions. At Evergreen Private Finance, we work every day with borrowers, brokers, and investors. Together, we make sense of our market’s signals, and always find the right opportunities to capitalize on.

Contact us today to discuss how we can all make the most of the opportunities hidden in our most recent market data. Get in touch today—either via email info@nullevergreenprivatefinance.com , or give us a call at 202.713.9072—and let’s discuss how we can make the most out of our still-hot market.