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A Hot Start to Summer: June DC Metro Real Estate Market Update


Record-High Home Prices and Buyer Dilemmas

The real estate market in our area continues to surprise and challenge buyers. May 2024 saw the median sold price hit $640,000, up 6.7% from the same time last year. This figure ties the record high set just a month earlier in April.High home prices are a double-edged sword: while they boost the market value for current homeowners, they also sideline many prospective buyers.


A Surge in Inventory

Good news is that inventory continues to increase. By the end of May, active listings in the D.C. metro area had jumped to 7,353—a 32.0% increase from last year. This rise in inventory provides more options for buyers still in the game, though it hasn't necessarily eased the competition or high prices yet.


Sales Trends

May’s market activity reflects the challenging landscape for buyers. Closed sales dropped by 2.2% year-over-year, with 5,121 transactions. New pending sales also fell, down 6.4% from last year. These declines indicate that many buyers are being pushed out by high prices and elevated mortgage rates.


Market Velocity

Despite some changes, homes that are well-priced and in desirable locations are flying off the shelves. Half of all homes sold in May were on the market for six days or less, demonstrating that demand remains robust for competitively priced properties.


Affordability Concerns - But Is a Cooldown Coming?

The coming months could see the area's housing market enter a slight cooldown period for those who stick with their home search. High home prices and elevated mortgage rates are particularly discouraging for first-time and moderate-income buyers, and many are expected to sit this summer out, keeping their fingers crossed for better conditions later in the year. This provides a window of opportunity for buyers who stick with their home search and act strategically while others wait on the sidelines.


Price Growth Expectations

While the region saw unexpected price strength in the first half of 2024, the pace of price growth is likely to moderate. Elevated mortgage rates continue to dampen the price relief some buyers hoped for. As Bright MLS Chief Economist Dr. Lisa Sturtevant noted, “Buyers on the fence of affordability must move to the sidelines. However, for those who can persist, more choices are coming online, and market conditions should ease in the second half of the year.


Navigating the Market

For Buyers

If you’re considering buying a home in the greater D.C. metro area, here are a few tips:

  • Be Prepared to Act Fast: With many homes selling in six days or less, being decisive and prepared is crucial.

  • Expand Your Search Area: If prices in your preferred neighborhood are too high, consider nearby areas that offer better affordability.

  • Stay Informed on Rates: Keep a close eye on mortgage rate trends. Even small changes can significantly impact your buying power. It's important to work closely with a local lender.

  • Work with a Skilled Agent: An experienced real estate agent can help you navigate the competitive market and find the best deals.

For Sellers

For homeowners thinking about selling, the market conditions are generally favorable:

  • Price Competitively: Homes that are priced right are selling quickly, often within days in multiple offer situations.

  • Highlight Unique Features: With more listings on the market, emphasizing what makes your property unique can attract more buyers.

  • Stay Flexible: Be open to negotiations and potential contingencies. Flexibility can make your listing more attractive in a crowded market.


Conclusion

The Greater Washington, D.C. real estate market is a mix of high prices, increasing inventory, and brisk sales for well-priced homes. Buyers face affordability challenges, particularly with elevated mortgage rates, while sellers can benefit from the competitive conditions by pricing their homes attractively and highlighting their unique features.

As we move into the summer months, the market may cool down slightly, providing some relief for buyers. Staying informed and prepared is key to navigating this dynamic market.

Whether you’re buying, selling, or simply keeping an eye on market trends, the D.C. metro area continues to offer a complex and evolving real estate landscape. If you have any questions or are considering buying or selling a home in the D.C. metro area, including Northern Virginia and Maryland, please don't hesitate to reach out to me.


Give me a call today to talk more about data in your specific area, and to create a strategic plan that me

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