Prospective home-buyers seeking high-end properties appear less fazed by current interest rates and economic conditions and are more willing to wade in and find their dream home, according to new data from BrightMLS.
The multiple-listing-service’s monthly “T3 Home-Demand Index,” updated on Oct. 12 with September data, shows that the strongest buyer interest in the Washington region can be found in the upper-end single-family and upper-end condo markets, with the high-end townhouse segment also showing strength.
Those positive signs helped the index gain four points, to 105, in the past month, although it remains down from 130 a year before and well below heights achieved during the boom-boom period earlier this year.
The index was created several years ago to look at indicators showing buyer interest, a forward-looking analysis as opposed to the backward-looking monthly home-sales reports. The current regional score of 105 sits at the upper end of “Steady” on the scorecard, which runs from 70-to-89 (Slow), 90-to-109 (Steady), 110-to-129 (Moderate), and 130-to-infinity (High). It peaked at about 160 during the spring of 2021 and has been lower, albeit in up-and-down fashion, ever since.
“Demand has trailed year-earlier levels for several months, most recently reflecting the impact of significantly higher mortgage rates combined with consumers’ uneasiness about the economy, which has sharply curtailed activity in other market areas, as well,” BrightMLS analysts noted.
Perhaps unsurprisingly, those with the cash to consider high-end homes seem less stressed either by the rising interest rates or economic weariness. The T3 score in the category of single-family homes priced above $950,000 was 178, highest of any segment during the month.
The threesome of Arlington, Falls Church and Alexandria found itself in High territory with T3 scores of 198, 166 and 155, respectively, although Arlington (down 15%) and Alexandria (off 24%) were off from a year ago.
Sitting in the middle of the pack were Fairfax County (117), the District of Columbia (112), Loudoun County (110) and Prince George’s County (100). Lower on the scale were Montgomery County (93), the city of Fairfax (77) and Frederick County (68).
One challenge throughout the Fairfax County portion of the Sun Gazette’s coverage area is a dearth of inventory for prospective buyers. Oakton ZIP 22124, McLean 22101 and 22102, Vienna 22182 and Great Falls 22066 each fall in the lowest category – “Limited” – because there are not enough available properties to adequately gauge buyer interest.
Elsewhere in the Sun Gazette’s Fairfax coverage area, Dunn Loring 22027 and Vienna 22180 each were in the Moderate buyer-interest category (123 and 115) while Vienna 22181 was Steady (101).
In Arlington, virtually every ZIP except 22207 (Steady at 105) was in the High category: 22206 (340), 22205 (245), 22201 (241), 22202 (226), 22204 (211), 22203 (194), 22213 (185) and 22209 (159).
For full details, see the Website at homedemandindex.com.