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ArlingtonReal EstateRegion home sales still solid, but headwinds may be on way

Region home sales still solid, but headwinds may be on way

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Home sales across the Washington region in October were down compared to the same month a year ago (during a period that had been artificially boosted by the COVID comeback), but showed good health compared to the market’s performance in October 2019.

Meanwhile, average sales prices keep on moving forward across most of the region, although those increases, coupled with fears of inflation, may soon have more of a negative impact on the local market.

A total of 6,316 properties went to closing last month, down 9.2 percent from October 2020 but up 13.1 percent from October 2019, according to figures reported Nov. 11 by MarketStats by ShowingTime, based on listing data from Bright MLS.

Figures represent transactions in the District of Columbia; Fairfax and Arlington counties and the cities of Alexandria, Fairfax and Falls Church in Virginia; and the counties of Montgomery, Prince George’s and Frederick in Maryland.


Compared to a year before, sales were up in Arlington, Frederick and (ever so slightly) Prince George’s counties, but down everywhere else. Compared to October 2019, prices were up across the board.

Sales were down about 0.6 percent between September and October, confirming that normal seasonality in the market seems to be returning after local real estate was turned higgledy-piggledy by COVID and the resulting economic lockdowns.

The median sales price of all properties that sold across the metro area in October was $535,000, up 7 percent from a year before. Prices were up in every part of the region except the city of Fairfax, with the strongest growth in Falls Church and Loudoun County.

Among various types of properties:

• The median sales price of single-family homes was $677,200, up from $630,000 a year before.
• The median sales price of townhouses was $510,000, up from $475,000.
• The median sales price of condominiums and cooperatives was $340,000, down slightly from $342,000.

The typical property garnered 100 percent of listing price, on par with Octobers of the preceding four years.

On average, it took nine days for homes to go from listing to ratified sales contract in October regionwide, up from seven days a year before but an improvement from the 14 days required in October 2019.

Inventory continues to tighten, with the months of supply (total homes on the market divided by typical sales in a month) falling from 1.7 in October 2020 to 1.15 this past month. In general, markets are likely to favor sellers when the months of supply is less than three, something that hasn’t occurred locally in October since 2015.

Across the Mid-Atlantic, a tension continues to emerge between supply, prices and sales, Bright MLS analysts note.

“Buyers are not only becoming less willing to pay a premium for their less-than-ideal house, but … affordability is also becoming an issue, since price growth has been outpacing income growth,” noted Bright MLS Economic Advisory Council members Elliott Eisenberg, Kevin Gillen and Lisa Sturtevant.

“The wild card is overall inflation,” the analysts noted. “Housing affordability is already a challenge, and if the costs of consumer goods continue to rise faster than incomes, buyers will defer major purchases, including buying a home.”

(Despite a market downturn, inflation paradoxically also could push up home prices – especially those of new homes – due to the rising costs of building materials, analysts noted.)

Of the three component metro areas of the Mid-Atlantic region, the Washington area is holding strongest, followed by Baltimore and then Philadelphia, based on the Bright MLS “T3” index, which gauges buyer interest in the market. Across the Mid-Atlantic, however, there appears to be a growing case of “buyer fatigue,” with current home showings down in double digits.

For more on the data, see the Website at www.brightmls.com/marketinsights and www.homedemandindex.com.

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