Will the 2024 housing market across the Washington region be a rerun of 2023 – lower sales but higher prices – or will other variables come into play and change the dynamics?
Everything could depend on whether current homeowners are willing to put their properties on the market to either trade up, downsize or relocate.
With the new year having dawned, analysts are hopeful that there’s nowhere to go but up.
“Inventory has been falling for nine consecutive months, and supply is only 56 percent of what it was in 2019,” said Lisa Sturtevant, chief economist for Bright MLS, the region’s multiple-listing service.
She was analyzing market data that was reported by the organization on Jan. 11.
A total of 2,217 homes came onto the regional market in December, down 20.5 percent from the already sluggish figures of a year before and the lowest monthly total in more than two decades. Total active listings at the end of the month stood at 4,732, down 12.6 percent from a year ago.
“The prospects for a busier 2024 housing market depend on more inventory,” Sturtevant said.
The past year saw few local homeowners opt to give up ultra-low-interest-rate mortgages they obtained in the early-COVID era. But time ultimately will win out.
“While ‘rate lock’ will keep many existing homeowners in their homes, there will be others who find that changes to family or financial circumstances will motivate them to move, bringing more listings to market,” Sturtevant predicted.
And with buyers ready to absorb the new inventory, there seems little likelihood that it will result in a market downturn, although it may impact the rate of home-price appreciation.
December proved that a lack of inventory does prop up prices, even during a traditionally slow time of year.
The median sales price of the 3,064 homes that changed hands across the region was $554,950, an increase of 8.1 percent from a year before. All 10 component localities saw upticks except for the District of Columbia (down 4%), and all three segments of the regional market posted increases – the attached/townhouse market saw a rise of 12.2 percent, followed by condominiums at 9.1 percent and single-family homes at 7.5 percent.
Median sales prices have now risen year-over-year for six months running.
Sales for the month were down 14 percent from a year before, marking the 25th consecutive year-over-year drop. On the plus side, the year-over-year drop in pending sales (1.1%) was the best performance since a small uptick was recorded 22 months previously.
Bright MLS’s catchment area includes the District of Columbia; Arlington, Fairfax and Loudoun counties and the cities of Alexandria, Fairfax and Falls Church in Virginia; and Montgomery, Prince George’s and Frederick counties in Maryland.
Figures represent most, but not all, home sales. All December 2023 figures are preliminary and are subject to revision.
