contracts…absorption ® market in a minute a summary of market conditions for january 2020 unless...

Copyright © 2020 – McEnearney Associates Washington, DC StatPak -

MARKET IN A MINUTE A SUMMARY OF MARKET CONDITIONS FOR JANUARY 2020

Unless otherwise noted, data derived from Metropolitan Regional Information Systems, Inc. (MRIS®). “Northern Virginia” is defined as Arlington and Fairfax counties and the cities of Alexandria, Falls Church & Fairfax.

CONTRACTS Contract activity in January 2020 was up 19.3% from January 2019 and was up in five of the six price categories. The average number of days on the market for homes receiving contracts was 47 days in January 2020, down from 57 days in January of last year. URGENCY INDEX The Urgency Index, simply the percentage of homes going under contract that were on the market 30 days or less, was up in January compared to the year prior. During the past 15 years, the Index has been as high as 83% (May 2005) and as low as 30% (December 2008). In January 2020, the Urgency Index was 56.6%, up from 50.7% in January 2019. INVENTORY The number of homes on the market at the end of January was up 1.0% compared to the end of January 2019. The number of new listings coming on the market increased 16.1% compared to January 2019. The increase in contract activity more than offset the increase in listings lowering overall supply to 1.6 months from 1.9 months at the end of January 2019. INTEREST RATES 30-year fixed mortgage interest rates at the end of January stood at 3.51%, almost one percentage point lower than this time last year, and almost a quarter point lower than last month at the end of December 2019. The payment on a mortgage originated today is 12% lower than an identically-sized loan a year ago. AFFORDABILITY The payment on a no-money-down, 30-year fixed mortgage for a median-priced home is 35.5% higher than a decade ago in January 2010 – but the median price is 63% higher. Despite rising home prices, lower interest rates have dropped the payment 8.8% compared to this time last year. The mortgage payment for a median priced home ($2,472) was lower in January than the median rented price ($2,850). DIRECTION OF THE MARKET Washington, DC had the biggest jump in new contract activity in January 2020 in the entire metro area. Almost every key metric is pointed in the right direction, and the healthy increase in the number of new listing coming on the market (up 16%) should help to give at least a little comfort to homebuyers who have faced chronically low inventory in DC over the last several years. Absorption rates across all three property types – condos/co-ops, attached and detached homes – are solidly in the seller’s market category. The spring market has started early!

WASHINGTON, DC FEBRUARY 2020 STATPAK

McEnearney.com


MONTHLY SUMMARY JANUARY 2019 vs. JANUARY 2020

January January %WASHINGTON, DC 2019 2020 Change

Number of Sales 517 567 9.7%Fully Available Inventory on 1/31 1,223 1,235 1.0%Number of New Listings 894 1,038 16.1%Number of New Contracts 641 765 19.3%Days on Market - New Contracts 57 47 -17.5%Average Sales Price $699,022 $729,590 4.4%Average Seller Subsidy $2,651 $3,078 16.1%Urgency Index 50.7% 56.6% 11.6%Months' Supply 1.9 1.6 -15.4%

MONTGOMERY COUNTYNumber of Sales 538 673 25.1%Fully Available Inventory on 1/31 1,548 1,269 -18.0%Number of New Listings 977 1,219 24.8%Number of New Contracts 785 917 16.8%Days on Market - New Contracts 66 55 -16.7%Average Sales Price $520,094 $572,140 10.0%Average Seller Subsidy $4,125 $4,552 10.4%Urgency Index 46.5% 52.8% 13.5%Months' Supply 2.0 1.4 -29.8%

PRINCE GEORGE'S COUNTYNumber of Sales 591 671 13.5%Fully Available Inventory on 1/31 1,780 1,266 -28.9%Number of New Listings 1,094 1,218 11.3%Number of New Contracts 976 913 -6.5%Days on Market - New Contracts 59 49 -16.9%Average Sales Price $297,163 $333,482 12.2%Average Seller Subsidy $5,563 $6,295 13.2%Urgency Index 45.5% 52.7% 15.8%Months' Supply 1.8 1.4 -24.0%

NORTHERN VIRGINIANumber of Sales 1,131 1,068 -5.6%Fully Available Inventory on 1/31 1,743 1,432 -17.8%Number of New Listings 1,547 1,607 3.9%Number of New Contracts 1,331 1,369 2.9%Days on Market - New Contracts 44 43 -2.3%Average Sales Price $565,874 $601,008 6.2%Average Seller Subsidy $2,891 $2,785 -3.7%Urgency Index 61.5% 67.9% 10.4%Months' Supply 1.3 1.0 -20.1%

LOUDOUN COUNTYNumber of Sales 289 292 1.0%Fully Available Inventory on 1/31 688 596 -13.4%Number of New Listings 531 546 2.8%Number of New Contracts 401 406 1.2%Days on Market - New Contracts 51 48 -5.9%Average Sales Price $534,892 $547,757 2.4%Average Seller Subsidy $3,547 $2,915 -17.8%Urgency Index 59.9% 68.5% 14.4%Months' Supply 1.7 1.5 -14.4%

* Note: Percentages depicted in red indicate a negative market trend; black indicates a positive market trend


WASHINGTON, DC – Detail Pages

30-YEAR FIXED AND 1-YEAR ADJUSTABLE RATES Month-End Mortgage Rates – 2013-Current

MORTGAGE RATES • 30-year fixed interest rates at

the end of January averaged 3.51%, compared to 4.46% at the end of January 2019.

• One-year adjustable rate mortgages were 3.24% at the end of January 2019, which is down from 3.96% at the end of January 2019.

BUYING POWER • A $1,000 principal and interest

payment supported a loan of $222,418 at the end of January, which is $24,128 more than January 2019, and $37,947 more than January 2009.

• In January 2010, it would have taken a monthly PI payment of $1,824 to purchase a median-priced home. Today it takes a payment of $2,472 to buy a median-priced home. That’s a 35.5% increase - but the median price is 63.4% higher.

AVERAGE PRICES • The average sales price in

January 2020 was $729,590 an increase of 4.4% from the January 2019 average price of $699,022.

• DC has the highest average and median sales prices in the region by more than $100,000.

• Remember that the change in the average sales price – up or down – doesn’t mean that individual home prices are impacted the same way.

BUYING POWER Mortgage Amount with $1,000 Payment

AVERAGES SALE PRICE Washington, DC – 2012-Current

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URGENCY INDEX % of Contracts on the Market for 30 Days or Less

Washington, DC – 2016-Current

URGENCY INDEX Washington, DC – January 2009-2020

URGENCY INDEX DC Metro Area by Jurisdiction Comparison – January 2020

URGENCY INDEX - January • In the past 12 years, the January

Urgency Index has been as high as 57.3% and as low as 32.1%.

• The average January Urgency Index during the past 12 years is 50.1% – which is lower than where it is now in DC.

• Contract activity is up 19.3% from last January – and the Urgency Index increased from 50.7% to 56.6%.

URGENCY INDEX – DC Metro Area • The average January Urgency

Index during the past 12 years for all five of the jurisdictions we track is 46.0% – significantly lower than where we are today which is 59.6% for all five jurisdictions.

• DC came in third this month. As noted above, it is higher than its 12-year average.

URGENCY INDEX – 2015-Current • This chart compares the number

of contracts (green line) to the percent that were on the market 30 days or less (blue bars). At first glance, it may appear that the lower contract activity also means a lower percentage of homes that sell quickly – but that’s not always true.

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NEW CONTRACT ACTIVITY • As noted on page 2, the number

of new contracts ratified in January 2020 was up 19.3% from January 2019. There were increases for five price categories.

• 25.1% of all homes going under contract in January had at least one price reduction. Last January it was 30.9%.

MONTHS’ SUPPLY • The overall supply of homes on

the market at the end of January 2020 was 1.6 months, down from 1.9 months at the end of January 2019.

• DC has the most balanced supply in the region across all but the highest price category.

FULLY AVAILABLE LISTINGS • As noted on page 2, the available

inventory for January 2020 was up just 1.0% from January 2019 and inventory increased for two price categories.

• 30.5% of all homes on the market have had at least one price reduction since coming on the market. In January 2019, 31.2% of all homes on the market had at least one price reduction.

FULLY AVAILABLE LISTINGS Washington, DC – January 31, 2019 vs. January 31, 2020

MONTHS’ SUPPLY Washington, DC – End of January 2019 vs. End of January 2020

NEW CONTRACT ACTIVITY Washington, DC – January 2019 vs. January 2020 by Price Range

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$1,500,000 and higher

# of New Contracts

January 2020

January 2019

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# of Months' Supply

January 2020

January 2019


AVERAGE NUMBER OF DAYS ON THE MARKET – NEW CONTRACTS • The average number of days on

the market for all homes receiving contracts in January 2020 was 47 days, which was down 17.5% from 57 days last January.

AVERAGE NUMBER OF DAYS ON MARKET Washington, DC – January 2019 vs. January 2020 – New Contracts

NUMBER OF NEW LISTINGS, CONTRACTS AND ACTIVE LISTINGS • There were 1,038 new listings

that came on the market in January 2020, a 16.1% increase from the 894 in January 2019.

• Note how consistent the gap between available inventory (green line) and contract activity (red line) has been over the 5+ years covered by this chart. That’s indicative of a very solid market over a long period of time.

SOME DEFINITIONS AND EXPLANATIONS TO AID YOUR UNDERSTANDING OF THE DATA • The data shown here are collected, in whole or in part, from the Metropolitan Regional Information System, Inc, and are believed to be reliable but are not guaranteed • “Sales” are transactions that settled during the statistical period; “Under Contracts” are contracts negotiated during the statistical period, but not yet settled • “Available Listings” reflects single-family homes, town homes, new homes and condos on the market at the end of the period in question. • “Months’ Supply” is simply the number of “Fully Available Listings” on the market at the end of the month divided by the number of “Contracts” ratified that month.

RELATIONSHIP OF SALES PRICE TO ORIGINAL LIST PRICE vs. DAYS ON MARKET • Initial pricing strategy is critical

to the listing process, regardless of market conditions. The longer a home sits on the market, the deeper the discount to its original list price will likely be.

• Homes settling in January 2020 that received contracts their first week on the market sold, on average, 1.04% above list. Those that took 4 months or longer to sell sold for 8.61% below the original price.

NUMBER OF NEW LISTINGS, NEW CONTRACTS, AND ACTIVE LISTINGS

Washington, DC – January 2014-Current

RELATIONSHIP OF SALES PRICE TO ORIGINAL LIST PRICE vs. DAYS ON MARKET

Resale Properties Sold in Washington, DC – January 2019 vs. January 2020

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# of Days on Market

January 2020

January 2019


Analysis by Property Type – Condo/Co-op

CONDO/CO-OP - LISTINGS • The number of new listings for

condos and co-ops coming on the market increased 24.3% compared to January 2019.

• The fully available inventory of condos as of January 31, 2020 was 9.8% more than the same time in 2019.

LISTINGS

CONDO/CO-OP - CONTRACTS • The number of condos and

co-ops receiving ratified contracts decreased 24.0% in January 2020 compared to January 2019.

CONTRACTS

CONDO/CO-OP – SETTLEMENTS AND AVERAGE PRICE • The number of condos and

co-ops settling in January 2020 decreased 1.5% compared to January 2019.

• The average price was up 16.4% compared to January 2019.

SETTLEMENTS

Condo/Co-opListings 2019 2020 % Change 2019 2020 % Change$299,999 and under 73 82 12.3% 99 107 8.1%$300,000 - $499,999 149 201 34.9% 172 169 -1.7%$500,000 - $749,999 139 160 15.1% 154 183 18.8%$750,000 - $999,999 45 79 75.6% 78 117 50.0%$1,000,000 - $1,499,999 31 25 -19.4% 48 48 0.0%$1,500,000 & higher 19 20 5.3% 60 47 -21.7%Grand Total: 456 567 24.3% 611 671 9.8%

New This Month Total Active

Condo/Co-opContracts 2019 2020 % Change 2019 2020 % Change$299,999 and under 65 60 -7.7% 65 60 -7.7%$300,000 - $499,999 122 139 13.9% 122 139 13.9%$500,000 - $749,999 83 126 51.8% 83 126 51.8%$750,000 - $999,999 28 40 42.9% 28 40 42.9%$1,000,000 - $1,499,999 11 14 27.3% 11 14 27.3%$1,500,000 & higher 4 9 125.0% 4 9 125.0%Grand Total: 313 388 24.0% 313 388 24.0%

New This Month Year-To-Date

Condo/Co-opSettlements 2019 2020 % Change 2019 2020 % Change$299,999 and under 54 52 -3.7% 54 52 -3.7%$300,000 - $499,999 117 89 -23.9% 117 89 -23.9%$500,000 - $749,999 69 71 2.9% 69 71 2.9%$750,000 - $999,999 16 25 56.3% 16 25 56.3%$1,000,000 - $1,499,999 7 18 157.1% 7 18 157.1%$1,500,000 & higher 5 9 80.0% 5 9 80.0%Grand Total: 268 264 -1.5% 268 264 -1.5%

Average Sales Price: Jan 2019 Jan 2020 % Change YTD 2019 YTD 2020 % ChangeCondo/Co-op $493,004 $574,050 16.4% $493,004 $574,050 16.4%



Analysis by Property Type – Fee Simple Attached

ATTACHED HOMES – LISTINGS • The number of new listings

coming on the market in January 2020 for fee simple attached homes increased just 0.9% compared to January 2019.

• The fully active inventory at the end of January decreased 12.7% compared to the available inventory at the end of January 2019.

LISTINGS

ATTACHED HOMES – CONTRACTS • Contract activity for attached

homes increased 14.2% in January 2020 compared to January 2019.

CONTRACTS

ATTACHED HOMES – SETTLEMENTS AND AVERAGE PRICE • The number of settlements

increased 17.0% in January 2020 compared to January 2019.

• The average sales price was down 14.8% in January 2020 compared to January 2019.

SETTLEMENTS

Fee Simple AttachedListings 2019 2020 % Change 2019 2020 % Change$299,999 and under 19 20 5.3% 12 20 66.7%$300,000 - $499,999 74 75 1.4% 85 72 -15.3%$500,000 - $749,999 91 76 -16.5% 110 73 -33.6%$750,000 - $999,999 72 76 5.6% 70 79 12.9%$1,000,000 - $1,499,999 44 49 11.4% 55 51 -7.3%$1,500,000 & higher 23 30 30.4% 70 56 -20.0%Grand Total: 323 326 0.9% 402 351 -12.7%


Fee Simple AttachedContracts 2019 2020 % Change 2019 2020 % Change$299,999 and under 19 16 -15.8% 19 16 -15.8%$300,000 - $499,999 54 66 22.2% 54 66 22.2%$500,000 - $749,999 80 69 -13.8% 80 69 -13.8%$750,000 - $999,999 47 64 36.2% 47 64 36.2%$1,000,000 - $1,499,999 23 34 47.8% 23 34 47.8%$1,500,000 & higher 9 16 77.8% 9 16 77.8%Grand Total: 232 265 14.2% 232 265 14.2%

Year-To-DateNew This Month

Fee Simple AttachedSettlements 2019 2020 % Change 2019 2020 % Change$299,999 and under 14 23 64.3% 14 23 64.3%$300,000 - $499,999 29 57 96.6% 29 57 96.6%$500,000 - $749,999 46 49 6.5% 46 49 6.5%$750,000 - $999,999 40 45 12.5% 40 45 12.5%$1,000,000 - $1,499,999 38 27 -28.9% 38 27 -28.9%$1,500,000 & higher 15 12 -20.0% 15 12 -20.0%Grand Total: 182 213 17.0% 182 213 17.0%

Average Sales Price: Jan 2019 Jan 2020 % Change YTD 2019 YTD 2020 % ChangeFee Simple Attached $861,100 $733,719 -14.8% $861,100 $733,719 -14.8%



Analysis by Property Type – Fee Simple Detached

DETACHED HOMES – SETTLEMENTS AND AVERAGE PRICE • The number of settlements

increased 34.3% in January 2020 compared to January 2019.

• The average sales price for detached homes increased 8.6% in January 2020 compared to January 2019.

SETTLEMENTS

DETACHED HOMES – CONTRACTS • Contract activity for detached

homes increased 16.7% in January 2020 compared to January 2019.

• The number of contracts for the full year is up 16.7%.

CONTRACTS

DETACHED HOMES – LISTINGS • The number of new listings for

fee simple detached homes increased 26.1% in January 2020 compared to January 2019.

• The number of detached homes on the market on January 31, 2020 was up 1.4% compared to January 31, 2019.

LISTINGS

Fee Simple DetachedListings 2019 2020 % Change 2019 2020 % Change$299,999 and under 6 8 33.3% 11 11 0.0%$300,000 - $499,999 24 19 -20.8% 47 32 -31.9%$500,000 - $749,999 29 33 13.8% 51 45 -11.8%$750,000 - $999,999 18 33 83.3% 21 36 71.4%$1,000,000 - $1,499,999 15 26 73.3% 15 18 20.0%$1,500,000 & higher 23 26 13.0% 65 71 9.2%Grand Total: 115 145 26.1% 210 213 1.4%


Fee Simple DetachedContracts 2019 2020 % Change 2019 2020 % Change$299,999 and under 6 4 -33.3% 6 4 -33.3%$300,000 - $499,999 21 23 9.5% 21 23 9.5%$500,000 - $749,999 18 30 66.7% 18 30 66.7%$750,000 - $999,999 14 18 28.6% 14 18 28.6%$1,000,000 - $1,499,999 17 21 23.5% 17 21 23.5%$1,500,000 & higher 20 16 -20.0% 20 16 -20.0%Grand Total: 96 112 16.7% 96 112 16.7%


Fee Simple DetachedSettlements 2019 2020 % Change 2019 2020 % Change$299,999 and under 2 6 200.0% 2 6 200.0%$300,000 - $499,999 11 20 81.8% 11 20 81.8%$500,000 - $749,999 11 17 54.5% 11 17 54.5%$750,000 - $999,999 17 11 -35.3% 17 11 -35.3%$1,000,000 - $1,499,999 12 19 58.3% 12 19 58.3%$1,500,000 & higher 14 17 21.4% 14 17 21.4%Grand Total: 67 90 34.3% 67 90 34.3%

Average Sales Price: Jan 2019 Jan 2020 % Change YTD 2019 YTD 2020 % ChangeFee Simple Detached $1,082,819 $1,176,067 8.6% $1,082,819 $1,176,067 8.6%



Absorption Rate by Property Type The following tables track absorption rate by property type, comparing the rates in the just-completed month to the rates in the same month of the previous year. The absorption rate is a measure of the health of the market and tracks the percentage of homes that were on the market during the given month and in the given price range that went under contract. [The formula is # Contracts/(# Contracts + # Available).] An example: The absorption rate for attached homes priced $500,000-$749,000 in January 2020 was 48.6%; that compares to a rate of 42.1% in January 2019, and the increase means the market was better in 2020 for that type of home. If the absorption rate was less in 2020 than in 2019, we have put the 2020 rate in red. This month there was improvement for 12 of the 18 individual price categories.

ABSORPTION RATES – CONDOS AND CO-OPS • The overall absorption rate for

condos and co-ops for January was 36.6%, which was an increase from the 33.9% rate in January 2019.

• The absorption rate for condos across most price ranges is more balanced in DC than anywhere else in the region.

ABSORPTION RATES – ATTACHED HOMES • The overall absorption rate for

attached homes for January was 43.0%, which is an increase from the 36.6% rate in January 2019.

• Again, look at the balance across most price ranges.

ABSORPTION RATES – DETACHED HOMES • January 2020’s absorption rate for

detached homes was 34.5%, an increase from 31.4% in January 2019.

• And the balance among the price ranges is evident here as well.

Condo/Co-opAbsorption Rates Listings Contracts Rate Listings Contracts Rate$299,999 and under 99 65 39.6% 107 60 35.9%$300,000 - $499,999 172 122 41.5% 169 139 45.1%$500,000 - $749,999 154 83 35.0% 183 126 40.8%$750,000 - $999,999 78 28 26.4% 117 40 25.5%$1,000,000 - $1,499,999 48 11 18.6% 48 14 22.6%$1,500,000 & higher 60 4 6.3% 47 9 16.1%Grand Total: 611 313 33.9% 671 388 36.6%

January 2019 January 2020

Fee Simple AttachedAbsorption Rates Listings Contracts Rate Listings Contracts Rate$299,999 and under 12 19 61.3% 20 16 44.4%$300,000 - $499,999 85 54 38.8% 72 66 47.8%$500,000 - $749,999 110 80 42.1% 73 69 48.6%$750,000 - $999,999 70 47 40.2% 79 64 44.8%$1,000,000 - $1,499,999 55 23 29.5% 51 34 40.0%$1,500,000 & higher 70 9 11.4% 56 16 22.2%Grand Total: 402 232 36.6% 351 265 43.0%

January 2019 January 2020

Fee Simple DetachedAbsorption Rates Listings Contracts Rate Listings Contracts Rate$299,999 and under 11 6 35.3% 11 4 26.7%$300,000 - $499,999 47 21 30.9% 32 23 41.8%$500,000 - $749,999 51 18 26.1% 45 30 40.0%$750,000 - $999,999 21 14 40.0% 36 18 33.3%$1,000,000 - $1,499,999 15 17 53.1% 18 21 53.8%$1,500,000 & higher 65 20 23.5% 71 16 18.4%Grand Total: 210 96 31.4% 213 112 34.5%

January 2020January 2019

contracts…absorption ® market in a minute a summary of market conditions for january 2020 unless...

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