Montgomery County MD Housing Market Update 2023
What 2023 Home Buyers Can expect this spring market in Montgomery County Md
Whats up everyone
We’re now in mid February and the spring market traditionally starts here in Montgomery County Md and DC right around the Super Bowl which was last weekend.
So the good news is you can expect a lot more listings to come on the market between now and June. Once July hits, the market tends to slow down a bit throughout the summer – at least it did prior to the pandemic.
The pandemic threw everything out the window but I think we are coming back to seasonal real estate activity – at least here in the DMV
So, I think we will see a lot more inventory in the coming months. But will it be enough to create a balanced market?
Let’s go over some numbers and I’ll definitely share my experience with you after working as a realtor for the past 20 years through many different markets.
Lets dive right in
As of today, we have 348 single family homes available in Montgomery County. They range from $342,000 in Dickerson MD up to 49 million in Potomac (that’s Dan Snyder’s house by the way).
Stay tuned to the end of this video if you want to see some pics of the 49 million dollar house!
If I narrow the search to new listings on the market, meaning they came on in the last week, we have 81 single family homes in Montgomery County.
And if I narrow it down even more to where you may want to live- let’s just take Rockville as an example- there are 8 single family homes ranging from 430k for a 1200 sq foot home in Twinbrook to 1.4 for a 4660 sq ft home in Sycamore Acres which is a bit further out in 20853.
Just for kicks, let’s check out Potomac and Bethesda. Potomac- 4 houses (and one of them is 49 million) Bethesda – 14 ranging from 807k for a 948 sq ft house to 4.2 for a 6635 sq ft house.
My point being there is NOT a lot of new inventory yet.
And the rest of the houses that have been on a while tend to get overlooked – usually that means they’ve either been overpriced or show poorly.
I’ll explain why I say this-
If you look at pending (meaning homes that have currently gone under contract in Montgomery County in the past week) about half of them have gone under contract in less than a week.
So what does all of this tell me-
That if a house is priced right and shows well, it is still selling quickly at or above asking.
In this situation, you can expect to be in multiple offers and most likely will need to do an inspection BEFORE writing a contract to compete with as few contingencies as possible.
I know, this is not what you want to hear. But I’m simply sharing with you real data and my experience.
So what about the other homes that don’t sell in a week, for whatever reason?
Well, here’s the good news. You will most likely be able to negotiate the price, do a full inspection, possibly further negotiate after the inspection, maybe ask the seller for help with either paying down your interest rate or helping you with closing costs, and have a “normal” transaction.
I’ve had both situations recently so they both exist in Montgomery County in real time
The tricky part for buyers is you need to be prepared for both scenarios. Here are some helpful ways to do that-
1- Get fully approved for a loan. Not just the pre qual, but fully approved so the only missing piece is the property.
This way when you find the property, you may be able to write an offer without a loan contingency (even though you are getting a loan) IF you are in competition. (please ALWAYS check with your lender before doing this)
Or if you are writing a “normal” offer, meaning not in competition, you will have smooth sailing to the finish line since you’ve already provided documention to your lender.
2- Work with a realtor who knows this market and has been through mixed markets in the past. This is super important.
You want the best guidance and someone who knows how to handle a mixed market. You also want someone who knows a lot of other realtors because networking and off market sales are very important in a mixed market.
If you would like to talk to me more about this- please reach out. We would love to help you but even if it’s not me, please make sure you work with an experienced realtor.
3- Be prepared to do an inspection right away. If you are in competition, this may mean you need to do it before writing an offer IF the seller allows it.
If you are the only offer, you will still want to do your inspection in the first week. So make sure you have a list of inspectors that are available and experts in their field that you can call and book asap. We provide a list of inspectors to our buyers so I’m hopeful other realtors do as well- so ask them before hiring them.
4- Don’t forget about radon. In the past few years the market has been so crazy that there was no time to do a radon test. It takes 48-72 hours to do one.
In Montgomery County the seller has to provide radon results by settlement if the buyer doesn’t do a test, but at that point, its too late to ask the seller to help remediate the radon if the level is higher than 4.0.
So..if you are the only offer, make sure you do a radon test during your inspection period so you can possibly negotiate remediation if the contract allows it.
5- Save some money! I’ve said this before in my videos and I’ll say it again. Buyers- ask your agent to ask the seller (through the listing agent) for a copy of their owners title insurance.
Once you have a copy- get it to the settlement company and ask for a reissue rate. I’ve saved my clients thousands of dollars by simply doing this one task. YOU HAVE TO ASK FOR IT. They will not offer it to you.
And if the seller cant find it, ask them where they closed on the house when they bought it and ask that title company. Depending on the price of the house when the seller bought it will dictate how much money you will save.
If you want more tips on how to buy a house in a multiple offer situation, check out this video. (I card of video)
So wants the bottom line-
Right now we have very little inventory but I expect a LOT more in the coming months. That being said, you should be prepared to have either scenario that we discussed because it’s house by house.
I would suggest looking (start with online) at the houses that haven’t sold quickly to see if there is anything decent that you may like. IF you find a house thats been on the market for more than 2-3 weeks, there is a better chance you will be able to negotiate.
And as for interest rates, Mortgage rates dropped for the fourth week in a row, as inflation numbers showed more signs of moderation. Will this continue- really only the FED knows but the majority of lenders I speak to daily think rates will stay around or below 6% for 2023.
I know there’s a lot of news out there of the housing market crashing. I do videos on the national housing market every Sunday and I can tell you things are very different in other parts of the country compared to Montgomery County MD. Does this mean we are immune to a housing correction – no, we are not.
We are feeling the correction since rates started going up mid 2022. BUT- I would be selling you false hope if I told you that I think home prices here are going to crash. The data simply doesn’t support it.
Let’s end on a fun note and look at Dan Snyder’s 49 million dollar house!
If it sells at that price, it will be the biggest residential real estate sale ever in the DC area.
Snyder bought the first part of the property from Jordan’s King Hussein and Queen Noor’s estate, paying just over $8.6 million and then purchased the surrounding six lots.
Talk about the ultimate flip!
A French chateau-style mansion sits on the gated property with five bedrooms and 13.5 bathrooms.
Here are some pics provided by longandfoster.com.
Photo credit Sean Shanahan
Pretty wild, huh? The views are incredible and I really like the pool area but the interior? And only 5 bedrooms? Why so many bathrooms?
Also did you notice there aren’t any pics of the kitchen? How bad could it be?
The money shot besides the view and pool has to be the garage.
What do you guys think? Any takers out there?