D.C.'s real estate market is cooling, slightly
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With pending home sales down 17.8% year-over-year, D.C.'s real estate market is showing early signs of slowing down. But median home prices are still up 7% from May 2021.
Why it matters: We keep hearing about a market crash, but so far local data doesn't support that claim.
Yes, but: Monthly data show early signs of a cooler market, even if it's slight.
What’s happening: From May 2021 to May 2022, new listings were up 7.4% and pending sales were up 4.6%.
- Demand is leveling off. More buyers are holding off as home ownership becomes too expensive.
- This comes after average mortgage rates surpassed 5% for the first time in 10 years.
Zoom out: Mortgage applications nationally were down 24%, and 6.5% of sellers on average dropped their asking price each week in June, per Redfin’s latest market update.
- In June, national pending home sales were down 13% from this time last year, the largest decline since May 2020, Redfin reported.
Be smart: Inventory overall is still critically low, which continues to push home prices up.
What we’re watching: New listings and pending sales. If more listings flood the market this summer and buyers don’t bite, that’s when we would start to see more power shift to buyers' hands.
Bottom line: We’re not seeing major changes in D.C. just yet, but we're starting to see early signs of a cooling market.