According to the 2010 First Quarter Trends in Housing Report, prepared by Delta Associates and MRIS, tracking the Washington DC metro area’s housing market trends, the local housing market has entered the recovery phase of the cycle, with several market indicators having improved over previous quarters and years.
Job growth, low levels of new home construction, and expansion of the lending activity, which is still constrained, will be the key factors that will affect the continuous recovery and growth of the market.
Some key points of interest are:
- Unit sales volume has increased by 9.2% in the first quarter of 2010 over the same time a year ago.
- Prices continue to show signs of a moderate recovery: 1st quarter prices in the metro are up from the same quarter in 2009. This is the second consecutive quarter prices have risen on a trailing 12-month basis, representing the first increases seen since the 4th quarter of 2007.
- An average of 71 days on market, a decline from an average of 110 days one year earlier, and the lowest time on market since 2006.
- The ratio of inventory to sales continues to decline in most jurisdictions from one year ago. The metro-wide ratio of 5.7 months’ worth of listings is below the normal, healthy standard of 6 months, (and compared to 7.7 months a year ago) signaling that demand is beginning to outpace supply.
- The gap between buyer and seller demands is closing with the average sales price in the 1st quarter of 2010 at 93.8% of list price, the highest ratio in more than two years.
- Sales prices posting gains in each of the first three months of the year, with prices in March 2010 increasing 3.3 percent over March 2009, and expected to continue gaining traction throughout 2010.
Even as lower-paying jobs are being lost, higher paying jobs are being added, which fosters housing demand. As the national economy gains traction, the Washington region’ housing market will strengthen even more.
