Home sales remain stubbornly slow in the D.C. region, even as mortgage rates continue to fall. Since the government shutdown in October, the number of homes sold has declined year-over-year in seven of the past eight months.
Sales in the D.C. metro area fell by 4.5 percent last month compared to June 2013, according to the latest data released Thursday by RealEstate Business Intelligence, a subsidiary of MRIS.
While uncertainty about the economy has potential home buyers leery of making large purchases, other factors could be at play. Sales fueled by investors snapping up foreclosures and other distressed properties have slowed significantly as those properties have worked their way through the system. Some buyers can’t meet the tougher mortgage qualifications standards. Home owners who refinanced when the rates were at historic lows are reluctant to move and take on higher rates.
The slowdown in sales seems to be moderating prices, putting an end to 28 consecutive months of price growth. The median sale price of $433,000 for the region last month was below what it had been the same month the previous year for the first time since January 2012. But it was higher than any month except June 2013 in the past seven years.
The District, Alexandria, and Howard, Prince William and Montgomery counties each saw year-over-year price drops last month. Howard experienced the steepest decline, falling to $400,584 last month from $419,332 in June 2013. It was the first year-over-year decline for the District in more than two years.
Pending sales, which have been on a seven-month slide, indicate that activity won’t be picking up anytime soon. Pending sales are homes that are under contract but the deals have not closed. There were 5,156 contracts pending last month, down from 5,683 in May and 5,434 in June 2013.
After months of low inventory, the number of homes on the market has been steadily increasing. New listings jumped 10.4 percent from June 2013, marking the fourth consecutive month this metric has risen.
With more homes being put on the market and fewer being sold, active listings also increased. There were 2,785 more listings last month than in June 2013, a streak of nine months of year-over-year increases. The 11,066 active listings last month were the most for a month since November 2011.