Washington’s Housing Market Still #1
Case-Shiller revises their monthly Home Price Index for the previous 24-month period as new information becomes available. Although the month-over-year change in Washington, DC’s HPI was revised down for the last three months, the streak remains unbroken. According to the June edition of the S&P/Case-Shiller Home Price Index, Washington, DC again posted the best month-over-year level among the largest housing markets in the country AND chalked up the 25th consecutive month that the HPI in the DC market led the country (183.61). That represents a 4.08 point advance over May (+2.3 percent).
The Index in Chicago did advance on a month-over-month basis at a faster rate, 3.6 percent. But the Index there is a considerably lower 115.61. For the sake of comparison, Detroit’s Index measured 65.42 in June, again posting the lowest HPI in the country.
The S&P/Case-Shiller® Home Price Index measures the residential housing market, tracking changes in the value of the residential real estate market. This Index uses a repeat sales pricing technique that collects data on single-family home resales, capturing resold prices to form sale pairs using a moving three month average. Call Rosemary for an analysis of the marketability of your home.
Sellers in the District and NVAR Accepting Better Offers This Year
The graph below compares the 2010 average close price to original list price ratio in the metro DC region and its component jurisdictions to the 2011 year-do-date average through July.
This indicator reflects the willingness of sellers to accept low offers (if the ratio is below 95 percent) and/or the seller’s ability to accurately price their homes to match current market conditions (if the ratio exceeds 95 percent). Note that this analysis uses the original list price rather than the current list price at sale.
Sellers in the District of Columbia and the NVAR area (Arlington and Fairfax counties, Alexandria, Falls Church and Fairfax cities) have seen improvement in their average close price to original list price ratios this year compared to last. Other areas in the region have declining averages this year.
PWAR (Prince William County and the cities of Manassas and Manassas Park) has the highest average 2011 ratio and is the only area that is above 95.9 percent. On the other hand, Prince George’s County has not only seen the largest decrease since 2010 but it is also the only area with an average below 90 percent.
The ratio for the entire region has declined only slightly with considerable help from the improvement in NVAR, which historically has the highest sales volume in the region. The significant decline in Prince George’s County this year, which ranks third in 2011 sales volume behind second place Montgomery County, led the others in pulling the metro DC average down from 94.5 percent last year to 94.2 percent this year.
It Takes Longer to Sell Homes in 2011 Throughout the Metro DC Region
The graph below compares the 2010 average days on market for the metro DC region and its component jurisdictions to the year-to-date average through July in 2011.
In every case, the 2011 average days on market has increased compared to last year:
- Metro DC + 16.9%
- Loudoun + 25.3%
- Montgomery + 17.4%
- NVAR + 17.1%
- Prince George’s + 8.1%
- PWAR + 34.0%
- District of Columbia + 10.4%
PWAR (Prince William County and the cities of Manassas and Manassas Park) has the lowest 2011 average in the region at only 54 days. However, it has also seen the largest increase from 2010 (40 days, +34 percent). Prince George’s County had the smallest jump compared to last year and it’s the only area with less than a 10 percent increase. However, its 2011 year-to-date average days on market far outpaces the average in other areas in metro DC (81 percent higher than PWAR).
Median Sales Prices Reach New Highs
The table below lists the median sales price in July 2011 compared to June 2011 and July 2010. The median sales price in the District of Columbia reached a significant milestone in July. Before July, the median had not reached $445,000 since June 2006 when the market was at the height of the housing boom here in metro DC. Similarly, NVAR (Arlington and Fairfax counties and the cities of Alexandria, Fairfax, and Falls Church) posted its highest median sales price since August of 2007. Montgomery County’s median was at its highest level since August of 2010. The metro DC July median ($355,000), including all the counties and jurisdictions illustrated below, matched the July 2010 median and increased the number of consecutive months the 2011 median met or exceeded the median in the corresponding month in 2010 to three.
Metro DC Homes Sales in 2011 Exceed 2008 Totals
The table below lists the existing home sales for the close-in counties and the District for the period January through July for every year since 2006. Total year-to-date sales in Loudoun County, NVAR (Fairfax and Arlington counties, Fairfax, Falls Church and Alexandria cities), and PWAR (Prince William County, Manassas and Manassas Park cities) have failed to reach the levels from any of the last five years. Prince George’s and Montogomery counties and the District have not met 2010 sales levels but are exceeding those from 2009 and 2008. The region as a whole though is 10 percent below 2010 levels, 6 percent behind 2009 but 5 percent ahead of 2008 sales totals through July.
Prince George’s County Can’t Catch a Break
April 12, 2011
(Washington, DC) – Spring has sprung along with the cherry blossoms in the nation’s capital but the housing market in nearby Prince George’s County had yet another rough month in March 2011. Of the six local markets, only Prince George’s posted a decline in its year-to-date median sales price. It fell from $164,000 as of February 28th to $159,900 as of March 31st. Compared to March 2010 when the median sales price was $190,000, the March 2011 median was only $155,000. Further, the average days on market increased 11 percent to 98 days in March. Prince George’s had the only close price to original list price ratio that declined and at 80.3 percent was also the lowest in the region. Prince George’s biggest problem though is the share of distressed homes sold each month. In March it was 71 percent, easily the highest share in metro Washington, DC.
Normal cyclical sales trends are at play – preliminary sales increased 36 percent across the region to 4,460 units in March compared to February’s revised total of 4,925. The advance was not enough though to reach the March 2010 level (when the First Time Buyer’s Credit was in full swing). The largest month-over-month percentage increase occurred in Washington, DC with a whopping 49 percent increase. The smallest was in Loudoun with 21 percent. For the first time this year, the median sales price exceeded the $300,000 bar at $305,000 measuring a healthy 6 percent increase over the February median. Montgomery County had the highest monthly increase last month to reach $331,900 (+11 percent). Washington, DC had the highest percentage increase compared to last March with $378,000 (+7 percent).
According to Loudoun-based real estate consultant Rosemary deButts, “As is often the case, February’s housing statistics were somewhat disappointing. While March is following normal cyclical patterns and had healthy increases, the sales pace and median sales prices seem to look more like 2009 than 2010 — before the First Time Buyer’s Credit artificially stimulated demand.” After nine months of consecutive increases, the average days on market indicator had a slight decline to 80 days in March. The 2011 average is also 80 days; compare that to 62 days in 2010. The low point was 51 days in May 2010. Loudoun had the highest month-over-month decrease to 77 days (-9 percent) while NVAR had the highest month-over-year increase to 71 days (+40 percent).
For the second consecutive month the close price to original list price ratio improved. It was 94 percent in March, 93.2 percent in February 2011 and 94.4 percent last March. Loudoun had the largest increase last month to reach 94.5 percent while Washington, DC had the largest increase compared to March 2010 to reach 93.2 percent. Average close prices advanced for all product types. The average for detached units was $462,242 in March; attached units posted an average of $324,659; and the average close price for condominiums was $275,028. The average close price for detached units in the Washington, DC market was $807,644, the result of 43 properties that sold for over $1,000,000 each last month. The highest sold price was $4,000,000.
The share of distressed sales (short sales and foreclosures) receded below 40 percent in March across the region after a sharp increase in February 2011. All local areas saw decreases in the share of distressed sales except for Prince George’s County and PWAR. The sub-market with the lowest share of distressed sales was Washington, DC at 15 percent. Rosemary deButts further commented, “March was the first month of the spring market. Disregarding 2010, sales were right on target compared to March sales in 2008 and 2009. While I don’t expect 2011 monthly sales to exceed the corresponding month in 2010 until the second half of the year, the market is behaving as expected.”