The Washington D.C. housing market is experiencing significant shifts, with an increase in active listings and adjustments in median list prices marking notable trends. Last week, new listings surged by 24% year-over-year, and active listings in the D.C. metro area skyrocketed by 56% compared to the same period one year ago. Nationally, active listings rose by 28%, contributing to a broader pattern of increased housing availability across the country.
The median list price nationally saw a slight decline of 0.2% as of last week, a change that is heavily influenced by the type of homes available for sale. In the D.C. metro area, the median list price dropped by 1.6% year-over-year. The upward trend in inventory began accelerating earlier this year, with January and February reporting increases of 35.9% and 41%, respectively. This surge is not solely attributed to homeowners putting their properties on the market; new construction listings, particularly condos, have significantly contributed to the inventory growth.
"The adjustment period following federal layoffs and funding cuts has likely put some Washington D.C. home searches on hold, both for those whose jobs have been directly impacted and those who may be concerned about what's ahead, and the data hints at these challenges," wrote Danielle Hale, chief economist for Realtor.com in a release.
The average rate on the 30-year fixed loan, which stood at around 7.25% in mid-January, has since decreased steadily to 6.82%. This rate reduction could potentially alleviate some concerns for prospective buyers in the D.C. area.
"While D.C. has the largest share of federal workers in the country, other highly federally employed markets could see similar shifts in the coming weeks or months," said Hale.
Despite the challenges posed by federal layoffs and funding cuts, inventory gains in the region from June to December were already showing a 20% to 30% increase over the previous year. The trend towards more condo listings highlights a shift in housing preferences and development within the market.