The result? It takes only nine days for most homes to be snapped up by hungry Washington home buyers. The region’s entire inventory of homes for sale could be consumed in as little as two months.
This tight inventory is pushing up home prices, setting up bidding wars and pricing new home buyers out of a market that is still enjoying historically low mortgage rates.
Homes in the $300,000 to $600,000 price range are selling the most quickly — usually in a week, according to June data — making the market particularly hard to navigate for first-time home buyers who want to live close to the District. Just a year ago, those homes sat around for at least three weeks.
Even homes at the higher end of the spectrum — from $600,000 to just shy of the $1 million mark — are on the market for eight days. On the other side of the scale, homes priced lower than $300,000 are available for just over two weeks.
Washington’s strong labor market and relative immunity from the housing crisis meant that demand never really dried up here, analysts say. But supply hasn’t kept pace.
Washington’s market has traditionally been far more robust than most of the rest of the country, thanks to the concentration of government and military jobs. The region’s stable economy continues to attract people looking for work, economists say. Even the recent budget cuts from the federal sequester have not significantly affected the local labor market. And Washington’s expensive rents are motivating some people to become first-time home buyers, experts say.
Those factors have led to an inventory shortage, which is worsened by a lengthy foreclosure process that’s holding up supply in the District and Maryland.
Forget about the dream home. In the current market, Washington buyers have to settle for what they can find — usually for a higher price.
When Alexandria resident Rodney Barredo began looking for a home in Northern Virginia’s red-hot real estate market, he quickly realized his options were limited. Every open house was “packed,” he said, and most homes were off the market a few days later.
“I know I’m not going to find the perfect home,” he said. “I might have to settle for one and just get what I can get.”
The tight supply is forcing real estate agents to become more creative. A personal — and heartfelt — letter may get the attention of some sellers, said Susan Mertz, a Realtor with Keller Williams Capital Properties in Virginia. When she has a client set on a particular neighborhood, Mertz said she knocks on doors and asks residents to contact her if they consider selling.
Some homeowners don’t realize the current value of their home, agents said. “I don’t know that the reality has caught up with sellers yet,” said Djana Morris, a Realtor with Long and Foster based in Washington.