We’re now firmly in the spring market, and there’s one question that has emerged that’s pretty hard to avoid: What happened to listing inventory in the City of Alexandria and in Arlington County?
At the end of March, most of the metro area had roughly the same number of listings on the market as this time last year. But in Arlington County, inventory is down 40%, and in the City of Alexandria, there were exactly half as many homes on the market.
Where did the listings go? Contract activity is a little higher than last year in both of these areas. But it isn’t contract activity that accounts for the big drop in inventory.
The partial government shutdown that started right around Christmas and extended through almost all of January undoubtedly put a squeeze on the metro DC real estate market.
We took a look at absorption rates – the pace at which the market is absorbing” the available inventory – in January and compared those to rate the previous January, and there is an inescapable conclusion: the market was slower.
We’ve been fortunate to have a very healthy real estate market in the metro Washington D.C. area for several years, and as we head into the fall market, that’s still the case.
Last month, we looked at some of the hottest areas in the region, with absorptions rates over 60% – what we call an extreme seller’s market. This month, we’re looking at the other end of the spectrum, where there is plenty of available inventory but less contract activity – those areas and price ranges where the absorption rate is 15% or lower, a buyer’s market.
Generally, that characterizes the market for homes priced more than $1M – to be sure, there are some luxury markets that are hotter than others, but we’re focusing today on homes priced less than $1M because that’s the heart of the market.
We’ve gathered all the reports with predictions and analyses about the location of Amazon’s HQ2, which is slated to bring 50,000 white collar jobs and $5B in investments. Where do you think the giant will land?
We know all real estate is local, and market conditions vary widely from community to community. We have taken a comprehensive look at the dynamics throughout the metro area (Alexandria; Arlington County & Falls Church City; Northern Virginia; Loudoun, Fauquier & Prince William counties; Washington, D.C.; and Suburban Maryland) for the first half of 2018 with a level of detail you won’t find anywhere else.
2017 ended with a bit of a whimper, as contract activity on our region’s real estate market cooled off along with the weather. But it was an overall solid year, with Washington, D.C. continuing to outpace its suburban neighbors. What’s ahead for 2018?
We’ll put our forecast into three categories: Steady State, the Wildcard and the Tantalizing Possibility.