The stranglehold that the polar vortex put on the D.C. metro area this winter hasn’t helped the housing market. February is typically a slow month, but sales were particularly tepid as cold and snow disrupted the region.
For the most part, home buyers and sellers sat on the sidelines, waiting for better weather. Not only were sales down from a year ago, but so too were new contracts and new listings, according to Monday’s report by RealEstate Business Intelligence, a subsidiary of MRIS.
The number of homes sold last month dropped to 2,590, down 3.5 percent from February 2013, marking the second month in a row that year-over-year sales have fallen. Although sales went up 6 percent compared to January, that increase was lower than the usual January-to-February bump of 7.3 percent.
Fewer homes came on the market last month, marking the first year-over-year decline since last spring. The 4,393 new listings were down 3.3 percent from February 2013, but up 7.9 percent from January. It was the first time since March 2013 that there were fewer new listings than in the same month the previous year.
Only 3,792 new contracts were signed last month, an 11.3 percent decrease from February 2013. It marks the third month in a row new contracts have fallen. Although new contracts rose 8.2 percent from January, the increase was slightly below the usual January-to-February rise of 8.7 percent.
Not all the numbers were soft. Gains in median price and active listings offset the sluggish activity in the market.
There were 7,011 homes listed for sale last month, which was 3. 9 percent more than January and 15.1 percent more than February 2013. Although the number of homes for sale has shown year-over-year increases for five months in a row, inventory remains 72.9 percent below its September 2007 peak.
The median price for the D.C. metro area was $375,000 last month, up 5.6 percent from February 2013 and up 1.4 percent from January. It was the highest median price for a February in six years and the 25th consecutive year-over-year increase. (When determining median price for the D.C. metro area, RBI includes only Arlington, Fairfax, Montgomery and Prince George’s counties as well as the District, Alexandria, Falls Church and Fairfax cities.)
Prince George’s County experienced the largest gain in median price last month, rising to $206,000, a 25.2 percent increase compared to February 2013. Falls Church city’s 24.5 percent drop in median price to $557,000 reflects more the limited number of sales in that city than a downturn in the market.
Despite the weak numbers, Jonathan Hill, president of RBI, expressed optimism for the spring. He anticipates a pent-up demand will surface in the coming months as sellers who have been waiting for sunny skies put their houses on the market and buyers who haven’t wanted to brave the cold in search of a new home become more enthusiastic, especially now that mortgage rates have temporarily reversed course.
“As the region finally thaws out, we anticipate a very active March market,” he wrote in the report. “Typical seasonal patterns suggest around a 35 percent increase in listing activity compared to February and a 25 percent month-over-month jump in new contracts as the spring market kicks into gear.”