DC’s tumultuous housing market had a rocky April, as median home prices climbed to a decade April high and inventory continued to tighten in the metro. However, rising home prices helped elevate the month’s sales volume, according to a new report by MRIS released earlier this week.
The median sales price for the DC metro area was up 4.1 percent year-over-year to $436,500, an increase of $17,250 from last year. April’s median sales price, the highest level for the month in a decade, “easily exceeded” last year’s record of $419,250, says MRIS — a provider of real estate information technology and one of the nation’s leading multiple listing services.
Sellers received on average 98.7 percent of the original listing price in April, up from 98 percent last year. Total sales volume in the DC metro area for April increased 1.7 percent year-over-year to over $2.4 billion.
But while prices and sales volume were up last month, homebuyers had far fewer homes to choose from. There were 9,552 active listings in April, 14 percent fewer than the same time a year ago. However, April’s listing inventory was up 10.5 percent from the previous month.
There were 7,664 new listings in the DC metro area last month, down 13 percent from last year. New contract activity dropped 8.3 percent from April 2016.
April marked the 12th consecutive month of annual inventory declines, and the metro’s inventory is at its lowest April level since 2014, says MRIS.
Homes sold faster last month in the DC metro area compared to the previous year. The median days-on-market fell from 14 days last year to 10 last month, according to MRIS data.
“The DC metro area’s housing situation is not unique. Supply is the biggest driver affecting prices nationwide,” Elliot Eisenberg, the Chief Economist of GraphsandLaughs and author of the report, told BuzzBuzzNews. GraphsandLaughs is a firm specializing in economic consulting and data analysis.
Land is a commodity that can be difficult to come by, especially in the DC metro area. When builders have the opportunity to build, the type of home they choose to build can have an enormous impact of the area’s housing market.
“Instead of building a million cheap homes, builders build half-a-million more expensive, high-end housing that will give them a better margin — which exacerbates the pricing problem,” says Eisenberg.
The scarcity of any available housing is the main culprit behind DC’s rising home prices, and inventory crisis.
“If the homebuilders, collectively, over the last seven, eight, or even nine years built say 6 or 7 million more homes, we wouldn’t have these problems. We’re all looking for homes, and there aren’t any,” he observes.
Click here to read the entire report.