The DMV Year End Market Report showed that while transactions were still relatively low in December, home prices rose strongly. The median price was up 8.1% year-over-year, with strong price appreciation for all housing types (i.e., single-family detached, townhomes, and condos) and across all regions throughout Bright’s footprint.
Median Sale Price Up 8.1% Across the DMV
The DMV Year End Market Report showed that while home sales activity fell seasonally in December, prices were up strongly in the Washington, D.C. metro area. The median home price was $554,950, which was up by 8.1%. Home prices were up strongly across housing types, and prices rose in all local markets except the District of Columbia.
The median sale price in Montgomery County was $554,000, up 4.5% YOY while Prince Georges County was $424,995, up 4.9% YOY. The median sale price in Howard County was $530,000, up 11.6%. The median sale price in Washington, DC was $600,000, down 4% YOY. The median sale price in Arlington was $760,000, up an eye popping 44.6% while the median sale price in Alexandria was $660,000, up 17.9% YOY. Falls Church City was up to $1,140,000, up 42.5%.
Listings Continue in Short Supply
Slower sales in December reflects the fact that there are few fresh new listings coming onto the market. According to the DMV Year End Market Report, in December, only 2,217 new listings came onto the market throughout the Washington, D.C. metro area. New listings are at their lowest levels in more than two decades. At the end of 2023, there were 4,732 total active listings in the DC metro area. Inventory has been falling for nine consecutive months, and is now 56% of the inventory level in 2019. There were 2,678 new pending sales in December 2023, which was 1.1% lower than a year prior. Monthly pending sales were at their lowest level since 2008. There were 3064 closed sales in the DC metro area, down 14% YOY.
Across the Mid-Atlantic
The DMV Year End Market Report is similar to the larger Mid-Atlantic market report.
Falling mortgage rates brought more buyers into the market in December, but they faced the same constraint that has been plaguing buyers for the past two years—a serious lack of homes to choose from.
There were 13,109 new pending sales through the Bright MLS service area in December, which was up very slightly (+0.5%) compared to the extremely low levels of market activity in December 2022. While transactions were still relatively low in December, home prices rose strongly. The median price was up 8.1% year-over-year, with strong price appreciation for all housing types (i.e., single-family detached, townhomes, and condos) and across all regions throughout Bright’s footprint.
It was definitely a little bit of a surprise to see prices rise so fast in December,” said Dr. Lisa Sturtevant, Bright MLS Chief Economist. “Lower mortgage rates enticed more buyers, but they are still finding a dearth of inventory. Prices will continue to rise until there is more inventory.”
Existing homeowners are still largely sitting tight. There were 11,780 new listings added to the whole mid-Atlantic market in December, which is a more than two-decade low. At the end of 2023, there were just 27,592 active listings on the market, which is down 2.9% from a year ago.
That level of inventory translates into 1.52 months of supply. A balanced market would typically have between four and five months of supply.
There is significant pent-up demand in the market which will likely be unleashed in early 2024 if mortgage rates continue to fall. However, the prospects for a busy 2024 market depends on whether there is more inventory. Right now, buyers should expect a very competitive market in 2024, with prices continuing to rise.
