The warning signs have been in place for months: rising interest rates, slowing housing starts, inflation, short supply. Even some major metropolitan areas where supply has been traditionally tight, a buyers’ market has been forecasted. A market slowdown is inevitable.
Note the following articles: Realtor.com’s Clare Trapasso says the slowdown is real (Sept. 24); Lydia DePillis of Money Magazine says buyers are sitting on the sidelines because of high prices (Aug. 28); rising home prices are outpacing wage increases, according to Ben Casselman of the New York Times (Sept. 29). It is not a clear picture. Although prices are still rising, they are not rising at the accelerated pace that they were rising. Nationally, list prices were up 7% in August over the same point the previous year; and that year, they were up 10% from its prior year, according to realtor.com.
The bottom line: prices are still high, just not rising at the same level. What does it mean for you? Keep these three numbers front-of-mind:
- Median Sold Price Over the Prior Year. In DC, the median sold price is up nearly 5% over the year before, according to the September statistics from Bright MLS. So yes, in DC, always the hot market, prices are slightly up.
- Closed Sales Over the Prior Year. If the number of settled contracts in a period over the prior year is significantly less, that means people may be waiting to list their home until the market improves. This period over last in 20878, closed sales are down 8% and in DC they are down nearly 4%.
- Price Per Square Foot of the Prior Year. Even if Days on Market changes, and in our home market of 20878, DOM is quite a bit longer (55% longer), holding steady on price per square foot points to listers getting their price. In DC, PPSF is up nearly 3% over last year, and in 20878, it is up 6%. This is a good sign for our clients if indeed the trends are pointing toward a difficult market.
There’s one more number: your zip code. It may be interesting that the residential trends in Seattle will favor buyers, or that Denver and LA are losing residents because of sky-high prices. What matters is what’s happening where you live. My home market, 20878, is experiencing different trends than the city of Washington, DC. If you stay abreast of your own market – and a good realtor can help you – you’ll know when the time is right to list or search.
For timely market local data and to get a confidential market review of your home, please contact The Faulkner Team, www.faulknerteam.com.