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Thursday, August 11, 2022
ArlingtonRegional home-sales market holding up against rising headwinds

Regional home-sales market holding up against rising headwinds

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It might require a psychiatrist to figure out the real-estate market across the local region – for every piece of worrisome news in recent data, there’s a counterbalancing data point suggesting that things are not quite as dire as gloom-and-doomers are predicting.

But there’s no question a shift has taken place from the go-go-go market that existed until springtime.

June figures were reported July 13 based on data provided by MarketStats by ShowingTime based on listing activity from Bright MLS.

“The market has been cooling since the spring, but in June we really saw the impact of rising mortgage rates and persistently high inflation,” said Lisa Sturtevant, chief economist for Bright MLS, which operates the regional multiple-listing service.

“Inventory has bottomed out in the region, with big increases in the availability of both single-family detached homes and townhomes in many local markets,” Sturtevant said in parsing the June sales data.

Sales across the Washington metro region totaled 6,653 for the month, down nearly 23 percent from a year ago, although that is still as much a factor of limited (but now growing) inventory as from buyers being scared out of the market.

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

Sales data represent a trailing index; some of the homes that went to closing in June came on the market as early as April, before additional interest-rate hikes began to hobble the market. So the figures, while an effective snapshot in time, are not completely up to date.

It’s almost like a game of ping-pong, parsing the information contained in the June report as it relates to the overall health of the market:

Good news? The total months’ worth of supply at the end of June was a tight 0.95, which suggests a continuing pro-seller market. In the immediate area, months’ of supply stood at 1.07 in Fairfax County and 1.5 in Arlington, which while higher than the regional average were still decidedly pro-seller figures.

Bad news? The number of showings of homes for the month plummeted 28 percent to about 125,000, suggesting some prospective buyers have decided to back away for the time being. It is the 12th consecutive month of year-over-year declines in showings, and the decline is more pronounced in the Washington region than in neighboring metros of Baltimore and Philadelphia.

Good news? The median days on the market between listing and ratified sales contract for homes that went to closing in June was a brisk 7, up just a single day from a year before and historically still very low, although it was up for the first time since January.

Bad news? Both closed sales and pending contracts were down in June more sharply than at any time since the pandemic hit in springtime 2020.
While prices kept rising (the regional median sales price of just under $600,000 for the month was up 5.8% year-over-year), that is the slowest rate of increase since January and fourth slowest of the 26 months of the pandemic era. That said, the median price is now $108,000 higher than it was in June 2020.

Arlington and Alexandria were among localities seeing lower year-over-year median sales prices in June, but that was due in part to fewer single-family homes and more condominiums being part of the overall sales mix in those two localities.

The condominium market has had the most sluggish rate of growth over the past year, with the median price rising just 1.1 percent regionally.

Figures represent most, but not all, homes on the market. All June 2022 figures are preliminary, and are subject to revision.

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