What’s up everyone

As mortgage rates are getting higher and higher, we are all feeling the changes in the housing market. So, what does that mean for the future of home prices? The intent by the federal government is for them to come down. So, have they?

Today we’re going to talk about what’s happening in Maryland and then get a little more granular about the DMV and lastly Montgomery county specifically and see if prices are coming down here like they are in other parts of the country and the trends moving forward. 

This is going to be a lot of information and a lot of data, but we’ll get thought it together and I’ll definitely let you know my thoughts along the way

Lets dive right in

We’ll start with all of Maryland.

According to Bright MLS, our local multiple listing service, for the month of September 2022, 

the median sales price is up 4.3% to $386,000 compared to last year. 

The median price is the middle value of the prices of all homes sold in the period.

The average price is also up 4.8% to $449,125 since 2021.

At the same time, the number of homes sold was down 28.6% to 6748 homes sold in September. Last year, there were 9445. So almost 30% less homes have sold this year compared to last. 

The active inventory right now is 10,577 homes compared to 13,318 in 2021. So less homes on the market now compared to a year ago.

The pending units are 6510 so that means how many homes are currently under contract but haven’t closed yet. In 2021, they are 8855. So less homes are selling today than a year ago.

So if you calculate the number of months of inventory we have right now by taking the number of houses for sale and dividing that by how many homes are sold,  that would equal  1.3 months which is super low! In 2021 they were 1.5.

The median days on the market is 11 days up fro 8 days a year ago and new listings are at 8566 for the month of September compared to 10,911 from a year ago.

When I compare this data to Redfin’s data for Maryland for the month of September, its not that different but I wanted to point out a few differences.

Redfin’s median sales price and number of homes sold are pretty similar to Brights but where they really differ is the median days on the market. Redfin has 29 days on the market, up 5 days from a year ago, while Bright reports 11 days. 

Since these numbers are for the whole state, I thought it best to share both. Where I am in Montgomery County, the days on market for well priced homes are more like 7-10.

Redfin also shows the number of newly listed homes for September in Maryland as 6638 which is down 31.5% year over year.

And 37.5% of homes had price drops, up from 27% of homes in September last year. 

So, the bottom line for the state of Maryland for September 2022, is that prices have gone up but sales have gone way down. 

There is just not enough inventory and with the higher interest rates, less buyer demand so less homes are going under contract. 

The trend is definitely moving towards lower prices with 37.5% of homes with price drops in September. Thats basically 1 out of every 3 homes is reducing their price. A little higher actually.

Now, let’s pivot to the DMV which means the Washington Metro – which includes DC, Northern VA, and Montgomery, Prince George and Frederick counties in MD.

This information is also coming from Bright MLS. 

For September 2022, closed sales were 4596, down 27.6% VS September 2021.  This is the  lowest September levels in eight years.

Median sales price is up 3.3% to $532,000

Median days on market is 15, up  +5 days which is the highest level since January 2020

New pending sales 4,487 down 32.7% – also the lowest September levels in 8 years!

New listings 7,129  down 22.5% since last September but new listings are up by 20.7% between August and September so sellers are coming back on the marketer the fall market but still not enough

Active listings 8,164  down 4.6%. While the total number of active listings at the end of September in the Washington area was down 4.6% compared to a year ago, inventory grew by 12.1% between August and September which can be attributed to seasonal activity.

Months of supply 1.40  which is up 10.3% since last September but is still super low

This is really interesting. We’ve had 104,907  Showings in September, down 29.2%. This is a clear indicator of buyer fatigue and low buyer demand. The September HDI (home buyer demand) for the Washington metro area was 106, down from 130 a year ago but up from 101 a month ago which makes sense since people are now back from summer vacations so I understand it being up from 


So, what’s the bottom line?

Are Prices Going to Fall? 

Despite higher mortgage rates and slower buyer demand, the median home price in the Washington region continues to rise, although at a slower pace. 

As market conditions continue to be cooler than last year, it is likely that prices will fall from their peak in many local markets. Even if prices do fall, however, they will remain much higher than they were before the pandemic. 

For example, if the metro area’s median price declined by 10%, it would still be 11% higher than it was three years ago.

Lets look at Montgomery County specifically

 For Montgomery County in September 2022, 

New listings are 1,223.  This is up 14.6% from August 2022 (1,067) but down 28.1% from September 2021 (1,700). Year to date, new listings are down 18.7% from 14,689 in 2021 to 11,940 for 2022.

New Pendings are 866,  so like I said, these are housing currently under contract. This number is down 18.9% from August which was 1,068 and down 34.5% from Sep 2021 which was 1,322. 

** This is a HUGE difference! I would expect more houses to be under contract in September than August simply because people are back at work, school etc and we traditionally get a fall bump in our market.

Year to date, new pendings are down 20.6% from 12,268 in 2021 to 9,735 in 2022.

Closed sales are 935 homes for September. This is down 12% from August which was 1,063 and 26.6% down from sep 2021 which was 1,273. These numbers have a bit of a lag to them because the homes that closed in September were bought 30-60 days ago which just shows how much the market has been slowing down in the last 5 months. Once interest rates started ticking higher and higher, less people bought homes which is pretty evident.

Year to date, Closed sales are down 17.6% from 11,788 in 2021 to 9,716 in 2022.

Median Sold price is $525,000 which is down 7.2% from August’s $566,000 so prices are definitely coming down. Now, here’s the interesting part- the median sold price is up 2.9% from sep 2021 when it was $510,000 and up 5.7% year to date from the 2021 price of $530,0000 to the 2022 median sold price of $560,000. 

So, like I said at the beginning of this video, prices are still much higher than a year ago.

Active listings are 1,259 homes, down 16.73% from Sept 2021 which was 1,512.

And the average days on market is 22 days, up 15.79% from 19 days in sept 2021. 

Like I said,  that is the average, but I’m seeing houses that are priced right and look good still going under contract in less than a week while other houses are sitting for 3-4 weeks so an average of 22 days seems ok to me.

And the ratio of sold price to list price is 98.8% which is down 1.42% from last September when homes were selling over asking at at 100.2% ratio.

So…what does this all mean to you if you are thinking of buying a house or selling your house?

IF you are thinking of buying a home, its definitely a good time to negotiate much more than in the previous 2 years. Not only price, but inspections, repairs, etc. Buyers are even able to get seller help for their closing costs right now if they are not in competition. And they are using that seller credit to also pay down their interest rate. So, if you are qualified and ready to go, you may be able to find a home that meets your needs and feels comfortable in terms. 

But, like I always say, real estate is more than just a transaction. It’s your home. You’re investing in you and your family’s future and if you are planning on staying at least 5 years, it’s a solid investment. For many reasons.

If you are thinking of selling, we just went over all the stats. There is not a lot our there, so I would definitley put my house on the market now if I was thinking of selling. You just need to make sure it is priced well and looks amazing so it falls into the category of homes I spoke about which sell fast and with multiple offers.

And speaking of that- if you are thinking of buying or selling in MD, DC or VA, and you would like our help, just send us an email and we’ll set up a zoom and get you started!

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