In this article, I’ll review some statistics for D.C. real estate for 2013, and will have something to say to both sellers and buyers in light of those statistics.
First, let’s consider the following graph of active listings vs. sold listings for the last 5 years:
The monthly inventory of available homes (active listings) has been declining rather sharply over the last five years (from 3,161 in January 2009 to 1,060 in December 2013), while monthly sales have risen steadily over the same time period (from 273 to 675). Percentagewise, that’s about a 66 percent decline in active listings vs. almost a 250 percent increase in sales. The space between the two lines in the graph indicates the months of available housing. Each 500 homes indicates about a one-month supply of housing for purchase. When there is a six-month supply, we say the market is in equilibrium—neither a seller’s nor buyer’s market. The lower the supply of available homes, the more it becomes a seller’s market. As you can see from the right side of the graph, we barely have a one-month supply of available homes for new buyers, and this has been true all of 2013. So we can say that all of 2013 has been a seller’s market.
The good news for buyers is that we expect there to be a number of new condo projects coming on line on 2014, which will increase the available inventory of homes — as well as a number of foreclosure homes (which have been in limbo in D.C. for almost the last three years) later in the spring. (So potential sellers, you might want to beat the spring competition by listing now!)
Now let’s take a look at comparison just between 2013 and 2014 in the following table (below):
Looking back, the D.C. market was strong in every variable over 2012:
• Total number of homes sold was higher by 14.51 percent;
• Total dollar volume of homes sold was higher by 21.99 percent;
• Average sold price was 6.53 percent higher, at $588,330;
• Median price was higher by 10.23 percent
• Average days on the market decreased by -28.33 percent to 43 days;
• Ratio of sold price to original list price (OLP) was up 2.46 percent to 98.8 percent, which means that home sellers are getting very close to their asking price.
All of these are signs of a continuing seller’s market. But buyers, take heart. There will be more inventory in the spring because of the new condos and foreclosures. And if you go out looking now, you’ll have less competition from other buyers holding back and therefore more selection.
Ted Smith is a licensed Realtor with Real Living | at Home specializing in mid-city D.C. Reach him at TedSmithSellsDC@rlathome.com and follow him on Facebook.com/MidCityDCLife, Youtube.com/TedSmithSellsDC or @TedSmithSellsDC. You can also join him at free monthly seminars for first-time homebuyers or monthly tours of open houses in a different neighborhood each week. Sign up at www.meetup.com/DCMidCity1stTimeHomeBuyers/.