Want to Know What to Expect for DC Real Estate in 2013?
As we ring in the New Year, it’s tempting to look into a crystal ball to predict what we can expect for housing in 2013. I’ve got some predictions and some hard facts – local market statistics from December – that give both buyers and sellers a better sense of what’s going on and what to expect this year.
Let’s start with the facts…
DC Metro Overview
This easy-to-read chart (above) provides a snapshot of key DC housing trends, compiled with the most recent numbers available from December 2012. Here’s a quick breakdown with some cool bar graphs:
Homes Sold: Sales numbers are up from this time last year. Although you will see new contracts have declined slightly for the 2nd straight month, which is typical for November and December due to the holidays.
- Double-digit year-over-year price growth remains. At $359,000, the median home price in the DC Metro Area is 10.5 percent higher than this time last year, the 3rd consecutive double-digit increase.
- The median price for single-family homes climbed the most from last December, up 12.9 percent, a gain of $51,000. This is the highest year-over-year gain for this property segment in 7 years.
- The median sales price for condos rose 10.4 percent from this time last year, and prices for townhomes rose 8.3 percent.
Inventory: The market is experiencing historically low inventory, with active listings at their lowest December-level in nearly a decade, and new listings at their lowest level for any month on record. Many potential sellers could be hesitant to enter the market during the winter months, so an increase in the spring inventory would likely entice buyers back into the market, and push median prices back up.
And now for my predictions about what to expect this year for both buyers and sellers in DC, MD, and VA:
- Low Mortgage Rates – Rates are expected to stay low for the coming months since the Federal Reserve Board left them untouched at its recent meeting. The 30-year fixed rate averaged 3.68% in 2012 and most economists expect it to hover around 4% for a while. These low rates make buying a home more affordable than ever, and but lenders will continue to be more stringent.
- Rising Prices – Prices in DC and nationwide are expected to continue to rise. You want home values to gain, right? Buyers may have a sense of urgency to get in before prices continue to rise, and sellers will find themselves with more bids closer to asking price (96.30% last month!) and able to sell a home that maybe couldn’t sell just a year or before. See graph below!