This regularly scheduled sponsored Q&A file is written by Eli Tucker, Arlington-based Realtor and Arlington resident. Please taxable your questions to him via email for effect successful aboriginal columns. Video summaries of immoderate articles tin beryllium recovered connected YouTube connected the Ask Eli, Live With Jean playlist. Enjoy!
Question: Is the lodging marketplace slowing down?
Answer: Over the past 2 to 3 months I’ve experienced a noticeable slowdown successful the single-family and townhouse marketplace comparative to what we’ve experienced astir of the past 12+ months. While slower than it has been, the marketplace is inactive precise competitive, and prices are holding.
Properties that would person gotten 8 to 10 (or more) offers a fewer months agone mightiness get 2 to 3 now. Escalations implicit asking are inactive communal but little extreme. And successful immoderate cases, buyers tin unafraid humble contingencies (inspection, appraisal, financing). I judge the main factors successful this alteration are:
- Buyers person distractions they didn’t person for overmuch of the lockdown (vacations, events, commutes, etc.)
- Asking prices are much reflective of marketplace values present that six-plus months of closed income successful 2021 are disposable for marketplace pricing analysis
- Some buyers person fixed up aft months of struggling to find/win a home
- Normal seasonal behavior. Demand usually subsides successful the summer, comparative to the erstwhile spring.
Home Demand Index Readings
To enactment the receding request into perspective, I pulled retired immoderate charts from the astir caller Bright MLS Home Demand Index, which tracks determination and section request by analyzing information ranging from purchaser showing enactment to closed income to feedback from section existent property agents.
Demand successful the wide Washington D.C. metro lodging marketplace dropped 17% from June to July and 13% year-over-year. The July 2021 Demand Index speechmaking of 123 is little than the Demand Index speechmaking successful 10 of the past 14 months, with the 4 months from November 2020 to February 2021 being the lone months with little readings since May 2020. July 2021 is besides the archetypal period with a year-over-year diminution successful request implicit the past 12+ months.
The Index uses the aforesaid terms ranges to way request crossed each Bright MLS marketplace centers (D.C., Baltimore, Philadelphia) truthful the terms ranges aren’t the champion for the D.C. metro/Arlington country but inactive supply a bully denotation of determination and section request trends.
The Demand Index for single-family homes ranging from $395K to $950K dropped 19% from June to July and 9% year-over-year. For single-family homes implicit $950K, the Demand Index dropped 29% from June to July and conscionable 2% year-over-year.
While these reports amusement important drops successful request recently, the existent request is inactive precise precocious and is capable to enactment caller terms appreciation.
Listing Volume Still High
The fig of condos listed for merchantability implicit the past 12 months is importantly higher than immoderate different 12-month play we’ve seen successful Arlington, but July listing measurement settled down to decorativeness person to humanities averages than we’ve been seeing. This is simply a motion that the surge successful condo proviso whitethorn beryllium tapering disconnected portion we’re besides seeing condo request summation comparative to the 2nd fractional of 2020 and aboriginal 2021.
High marketplace values and changing lodging needs person besides led to an summation successful the fig of single-family homes listed for merchantability successful Arlington lately, but that measurement is overmuch person to the humanities mean than what we’ve witnessed successful the condo market. It besides does not look similar it to astir buyers due to the fact that request has rapidly absorbed the other supply.
There’s usually an summation successful request and homes listed for merchantability aft Labor Day, and I expect to spot akin seasonal behaviour this twelvemonth until we scope the winter/holiday marketplace starting astir aboriginal November erstwhile request and listing proviso some thin to retract.
Historically, it has taken until precocious February/mid-March for request and listing measurement to ramp up towards their outpouring peaks, but the past fewer years we’ve seen the ramp-up period, particularly for demand, commencement successful January. I expect a akin signifier adjacent twelvemonth but volition beryllium amazed to spot thing similar the double-digit terms appreciation that we experienced successful 2021 repetition successful 2022.
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If you’d similar a question answered successful my play file oregon to sermon buying, selling, renting, oregon investing, delight nonstop an email to [email protected]. To work immoderate of my older posts, sojourn the blog conception of my website at EliResidential.com. Call maine straight astatine 703-539-2529.
Video summaries of immoderate articles tin beryllium recovered connected YouTube connected the Ask Eli, Live With Jean playlist.
Eli Tucker is simply a licensed Realtor successful Virginia, Washington DC, and Maryland with RLAH Real Estate, 4040 N Fairfax Dr #10C Arlington VA 22203. 703)-390-9460.