It’s nearly the end of summer and the Capitol Hill real estate market is in its usual malaise. Seems like nothing is selling and prices are lower than they were in the spring. The sky is falling. So much uncertainty out there in the market and in the world in general. What is going to happen when I want to sell my $2M home?
The short answer to this is that the sky is not falling. The late summer and early fall market is historically the slowest time of the year for us. Held an open house lately? All the buyers must have gone to the beach or are spending the summer at that remote work/getaway house that they bought four years ago to escape the pandemic!
Two absolutes: During the first six months of the year, 60 percent of our sales are made. Last six months, 40 percent. Doesn’t seem like much of a difference, but it is enough to make it feel like the real estate market is heading south. But it does this every year. The last six months are more of a buyer’s market. That said, a lot depends on the product. The right house at the right price will still move quickly and possibly with multiple offers. Not a time to be too aggressive with price.
Uncertainty in a Given
The second absolute is that we have no idea where this market is heading—we never do. We can only look backward and watch the trends. Will the recent talk of lower interest rates have an impact? Of course, but how long will buyers wait to come back in sufficient numbers to make a difference?
Most lenders have already baked in lower rates and have come up with some creative programs that put a lot of cash in a buyer’s pocket to ease the transition to home ownership or to that next, bigger home. Uncertainty is definitely a problem. But, in the summer of 2020, who would have guessed that we were staring down the barrel of 24 months of the best real estate market that we have had in recent history!
As to the numbers for this year for single family homes in Washington DC, I think we can safely say that we will end the year with a small bump in median sales prices (3-5 percent). The actual number of sales will be about the same as last year at around 3,400. Days on market up slightly to 35. A slight increase in upper bracket sales to 83 percent percent of the market (prices >$500,000). Number of listings up, but the market is not flooded with inventory.
On Capitol Hill, much the same. Our median prices are off a little. The Hill number of properties over $500,000 is still at roughly 98 percent. I know it’s ancient history and lots of factors at work, but that 98 percent number staggers me when I see that the number of sales in 1995 for properties under $500,000 represented 99 percent of our market!
Bottom line is, don’t play the market. Look at your own situation and when the numbers and other factors work for you as a buyer or seller, jump on it.
Don Denton is Associate Broker at Coldwell Banker Realty, 350 7th St. SE. 202-256-1353.
