Existing-home sales rose in July to the highest level in five months, is the new tidbit of last week. But what does this REALLY mean and what does it mean for Washington DC?
Are we at the bottom? ARE things changing?
In the District of Columbia in July, the average SOLD Price for a home was $580,119. This was up 2.64% from last year. However the number of homes sold in July '08 as compared to July '07, was down 31.62%.
Throughout the DC Metro area, the number of homes sold vs. last year is down from between 14% to 35%. While the average home sold price ranges, July over July, ranges from +2.64% in DC to -11.76% in Montgomery County.
Clearly the market IS still slower in the DC market, than the prior years. However prices, at least inside the District, are remaining steady, even slowly creeping up.
Real Estate market conditions are extremely local. Local markets - even "Mirco" markets can vary greatly. For instance; inside the District: the Logan Circle Neighborhood (2005 zip code); average sold prices are virtually flat; while the number of properties sold are up 10%. In the Shaw/Chinatown Neighborhoods (20001 zip code), prices are down 14%; while sales are up 27%. Now some of this most certainly has to do with new construction of lower-priced condos, in these areas.
In a future post; I will show Months of Inventory on the market. I believe this is a better number to show if we have "hit bottom". Once we see fewer homes on the market; I see it as meaning we have reached a point where sellers have found the asking price at which buyers are now willing to pay - and are in fact buying.
It is basic supply and demand. The "bottom" of the market will only be reached; when supply starts to decrease.
So have we reached "the bottom"? It depends. In the popular: Dupont Circle, Logan Circle, Chinatown and Adams Morgan neighborhoods; I would say - we getting close. In Arlington County; I would say we getting real close. In Prince Georges County; I would say; not even close.
Call James for all your Real Estate needs and questions; servicing Virginia, Maryland and the Greater Washington DC area.
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5028 Wisconsin Ave NW Suite 100
Washington DC 20016
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I suspect that the cost of transportation is a huge factor in home sales in DC, Arlington, Alexandria, Silver Spring and other close in areas.
That same cost of transportation has seriously surpressed sales in the outer suburbs. Commuters don't see relief in the forseeable future and don't want to devote $5000 a year just to get to work and back home every day.