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The 2nd quarter of 2024 is solidly behind us and the results for the Greater Washington, D.C. real estate market can only be described as one of a market “in flux”. Q1 showed continuing abysmal inventory levels and that trend continued through April. However, May and June delivered significant increases in inventory levels across all housing types. Average home sale prices continued to rise with Northern Virginia up (+9.1%), Washington, D.C. (+6.8%) and the close-in counties of Maryland (Montgomery +6.3 and Prince George’s County +3.4%) showing strong price growth. Unit sales, with little exception, were down across the region in Q2 and DOM (days on market) also showed significant declines.
The market for single family homes in Fairfax County is forecasted to be down -9.9% (GMU forecast) although certain communities will fare better based on geographical location. Townhomes will continue to perform better overall than other housing types from a resale aspect based on price point. Condo sales continue to fluctuate based on location and price.
The real estate market moving into the 3rd quarter will be a bit unpredictable. Increased inventory typically has a declining impact on home prices. Declining home prices would normally drive unit sales up. Although inventory levels did rise dramatically in May and June, unit sales were still down significantly in those months, which is a bit puzzling since increased supply would traditionally equate to higher unit sales. We will be watching to see if the demand aspect will catch up to the inventory supply trajectory going forward into Q3.
Although the greater Washington, D.C. market has been relatively insular, there are several factors that have eroded the usual healthy market that we’ve become accustomed to and have relied on. The hybrid work model (flexible work schedules combining remote and on-site work) is now causing the geographical area for Northern Virginia to expand which is driving sales to areas outside of what we might consider the traditional D.C. market. Sales continue to march south and west into Loudoun, Stafford, Frederick and Henrico counties as well as some other counties in Maryland. In the 2nd quarter, 18% of D.C. residents searched to move out of the city limits placing it into the top ten markets people are trying to relocate from. Northern Virginia is also experiencing some population flight but not nearly to the extent of Washington, D.C.
Other factors include multi-family construction being down (-15.9%) in Q2 even though some previous multi-family starts are coming to fruition - up +9.2% from the same time last year. Rents continue to climb at a rate of +4.2% making it slightly more difficult for regional workers to afford those rent increases and therefore the ability to purchase a home thus sending them out to the further reaches of our market.
Lastly, there is great angst among would be buyers from an affordability aspect. Again, home prices and interest rates being the specific impediments to a more robust real estate market for those buyers. Consumer confidence continues to erode, consumer debt is rising and the practice of continuing budget resolutions in congress does little to instill confidence in contractors and government workers thinking about purchasing a home. As referenced above, Q3 and Q4 will be a bit unpredictable. However, as we all know, the real estate market is extremely resilient. Let’s hope that the increased inventory levels out home prices bringing those sideline buyers back into the picture!
Q2 2024
NORTHERN VIRGINIA
Single family, townhouses & condominiums
ALEXANDRIA ARLINGTON ASHBURN
FAIRFAX CO FAIRFAX STATION LORTON
MARKET BALANCE
The market balance is determined by the average months of supply, Jun 2024
Q2 2024
WASHINGTON, D.C.
Single family, townhouses & condominiums
24
GEORGETOWN KALORAMA
LOGAN CIRCLE
MARKET BALANCE
$533M TOTAL SALES (CONDO & CO-OP) Q2 2024 1,104units soldQ22023 27% → condo & co-op
873 units sold Q2 2024
The market balance is determined by the average months of supply, June 2024
Single family, townhouses & condominiums*
BETHESDA CHEVY CHASE POTOMAC
ROCKVILLE SILVER SPRING CALVERT CO
CHARLES CO FREDERICK CO
1,623units soldQ22024 3% → single family homes
MARKET BALANCE
The market balance is determined by the average months of supply, June 2024
ALEXANDRIA
1701 Duke Street, Suite 100 Alexandria, VA 22314
703-535-3610
ARLINGTON 2111 Wilson Boulevard, Suite 1050 Arlington, VA 22201
703-224-6000
144 Church Street NW Vienna, VA 22180
703-564-4000
MIDLOTHIAN
15871 City View Drive, Suite 120
Midlothian, VA 23113
804-858-9000
1775 Tysons Blvd Suite 1450
Tysons, VA 22102
703-564-4000