Will Home Prices Continue To Rise?

Dear Family,

As we near the close of 2023, the real estate landscape in the Washington DC Metro region continues to display resilience and adaptability despite facing challenges. Here's a snapshot of the recent trends and insights shaping the market:

Market Activity Overview:

• Sales and Pending Sales: Despite a 6.3% decrease in closed sales from November 2022, the region witnessed 15,970 total sales last month. Notably, new pending sales in November stood at 15,964, down by a marginal 0.7% from the previous year, indicating sustained buyer interest.

• Housing Demand: Dr. Lisa Sturtevant, Bright MLS Chief Economist, noted robust housing demand persisting through the fall despite the two-decade high mortgage rates. Factors such as all-cash buyers and those capable of significant down payments have bolstered market activity this year.

Inventory and Price Trends:

• Inventory Dynamics: November saw a decline in inventory after three consecutive months of increase. With 32,522 active listings in the Bright MLS service area, supply dipped by 5.5% compared to a year ago. The number of new listings entering the market dropped by 22.2% between October and November.

• Price Growth: Limited inventory continues to drive price growth, with the median sale price in November reaching $380,500—an increase of 5.7% year-over-year. Prices remained relatively stable, experiencing only a marginal 0.1% decline from October to November.

Looking Ahead to 2024:

• As we approach the conclusion of 2023, the overall number of home sale transactions in the Washington DC Metro region is anticipated to hit its lowest level in over a decade.
• However, optimism prevails for 2024, with expectations of increased market activity as mortgage rates are projected to decline. This decrease in rates is anticipated to encourage both sellers and buyers to participate more actively in the market. Homeowners, previously hesitant due to low mortgage rates, are likely to reconsider listing their homes, while lower rates will entice more buyers into the market.

The real estate landscape in the Mid-Atlantic remains dynamic, driven by evolving economic factors and shifting buyer-seller behaviors. Stay informed as we navigate these changing trends together.