Looking back at 2013 - Looking ahead to 2014

The outlook continues to be bright for the Washington, DC area real estate market.  The median sales price for residential real estate hit $399,950 in November 2013, an increase of 8.1 percent over the same time last year, according to Realestate Business Intelligence, LLC, and the Center for Regional Analysis at George Mason University.  This is the highest median sales price for the month of November in the past seven years.  Residential properties are selling quickly.  The average property remained on the market for an average of just 20 days last month. 

            Condominiums led the pack in median sales price increases at 8.3 percent, or an average increase of $22,500.  Townhome median sales prices increased 5.6 percent from the year before, or an average of $21,000.  The median sale price of detached single-family homes increased an average of 4.9 percent, or $22,000 over last year.

            Real estate market inventory also is increasing, up 5.7 percent over this time last year.  The number of properties for sale is still significantly lower than its peak in November 2007 – 68.1 percent lower!  Tight inventory and buyers willing to pay increased prices often results in multiple offers for desirable listings.  According to RBI, this trend may continue.  While median prices were up significantly, the percent of closed sales actually decreased 13.7 percent compared to last November.  RBI states that this decrease is “likely due to the uncertainty caused by the shutdown of the federal government in October.”  It is quite possible that buyers affected by the shutdown have only delayed their decisions to purchase property, which may contribute to increased demand in the coming months, the organization suggests.

            Falls Church experienced the highest median sales price growth in the region.  Average sales prices in Falls Church increased 34.4 percent, or nearly $200,000, in the past twelve months.  Prince George’s County was second, with a median 12-month sales price increase of 16.3 percent.  Fairfax City, Washington, DC, and Montgomery County also saw double-digit median sales price increases over the same time last year.

            The spring housing market is just a few months away.  If current trends continue, tight inventory and motivated buyers are likely to bring increased sale prices and limited days-on-market.  If you are planning to sell, now is a good time to begin to prepare.  Take advantage of the inclement weather outside to arrange for painting, new carpets, and other upgrades that may have to be done before your home goes on the market.  If you are planning to buy, anticipate lower-than-average inventory and increased buyer competition.  An experienced real estate agent is your best source of information and advice, whether you are planning to buy or sell – or both.  The Washington, DC, area is still a seller’s market.  Take steps now to gain from it.

By George Papakostas - GeorgeP@lnf.com