It’s hard to believe we’re already in Q3 of 2023. The year has moved quickly—and, as tends to be the case in our neck of the woods, so has the DMV real estate market.
When we last looked at what the market was telling us, we’d seen indicators that some pre-COVID trends might be returning. There had been a rise in the existing median home price across the country, a slight improvement in the nationwide existing homes inventory, and a rise in pending home sales. Have those trends continued as the year has progressed? Here are four things we’ve noticed at the year’s midpoint.
Locally, the prices continue to rise…but slowly.
Within the District and surrounding northern Virginia counties, home prices have continued to rise from where they were a year ago, slightly outpacing the rate of the country overall (.8 percent versus .3 percent). However, that growth is slowing when compared to long-term trends.
Pending home sales fell.
While pending homes in the northern regions grew slightly in June, within the larger southern region, month-over-month home sales fell by 1.4 percent compared to May. This isn’t entirely unexpected, given that real estate supply tends to peak a bit earlier in the quarter in the south, in large part due to slightly differing school calendars, however, this is a statistic to keep an eye on in the months ahead.
Demand for housing remains high.
Based on nationwide historical averages, the Washington, D.C., metro area remains under a significantly high housing shortage, with one out of every five housing jobs requiring a new single-family permit.
The National Association of Realtors database shows more than 55,000 jobs having been pulled in the past year, this indicates builders have confidence in the market and signals to buyers that buying in the area remains a good long-term investment. However, as they look for their new home, options are likely to remain somewhat limited, and they may need to evaluate whether to buy an existing home—if they can find one that meets their needs—or building new.
New construction trends continue to develop. While the area continues to see growth in new home builds (and the inventory shortage shows a need for it), the current level of new construction in the area remains 19.8 percent lower than usual as of Q2 2023. This number is the continuation of a downward trend for new construction in the area, putting a premium on new-build opportunities. As we move into fall, the new
