FAQs When's the Best Time to Sell My House??

When you're ready! And also spring and early summer. Here's my unscripted answer to this commopn question:

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Where are Real Estate Prices Going This Spring?

The answer to this question largely depends on rates and inventory levels. We're seeing rates down a bit in the aftermath of the bank failures, and it’s possible that a new round of financial uncertainty will be favorable for borrowers. We're all waiting to see what happens at tomorrow's Fed meeting.  Dr Lisa Sturtevant, our BrightMLS chief economist, says that low inventory will be the primary constraint on the housing market this spring. New listings are only trickling onto the market because the high rates are keeping potential sellers at bay with many of them are holding mortgages in the sweet 3% range. Inventory has been rising and in some markets active listings have doubled year over year but supply is still only half of 2019 levels. (2019 was the last time we saw a "normal" market.) Buyers will certainly have more choices going into the 2023 spring market but inventory is likely to remain low which will put a floor under prices keeping them stable or rising in most local markets this spring.  Here's a look at year over year numbers in 3 local DMV markets - Arlington, VA, Capitol Hill, DC and Silver Spring MD. In all three we see a month or less of inventory which is about as low as it gets. This means that if no new listings come onto the market, inventory would sell out in that time and that's exactly what's keeping a floor under home prices in the DC area. If rates continue to go down, which seems likely considering the bank failures, I expect to see more buyers enter the market which will create increased demand and push prices up into the spring and summer.  Even with the current market slow down we're still seeing the desirable listings go under contract very quickly. When rates dipped down just below 6% a few months ago we saw mortgage applications spike which means buyers are just waiting for an opportunity to jump. The slight pull back in prices that we're seeing in Capitol Hill at 4.9% and Arlington at 2.4% is marginal compared to the appreciation these areas saw over the last couple of years. Silver Spring with only a 3/4 month of inventory is seeing an almost 10% median price increase year over year. This is indicative of the low supply narrative and if inventory stays this low, it will continue to be a very competitive market for buyers there.  Overall I expect the spring market to see more inventory trickling on and if rates stay range bound in the mid to high 6's we'll probably continue to see reduced contract activity but prices stable and rising. If the rates get down into the 5% range all bets are off. Pent up seller and buyer demand will be unleashed and we could see the market speed up rapidly. As always, reach out if I can be of service to you! Erin

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2023 Market Predictions for the DC Metro

Here's my two cents: Inventory remains historically low which will keep upward pressure on prices. One thing I noticed in November when rates went down for the first time in weeks, was that the drop was immediately followed by a bump in new contracts - a .25% drop brought a 7% increase in new contracts. So buyers are out there waiting. We're already seeing sellers offering incentives like rate buy-downs and that should continue. The big problem in the DC area is lack of inventory so more buyers entering the market could bring back a somewhat competitive market for buyers even at 5%+ rates. I think we'll continue to see fewer transactions through the year because a number of buyers are priced out of the market. Here's what the economists are saying: Nadia Evangelou, Senior Economist and Director of Forecasting, NAR   "Mortgage rates started the new year near the 6.5% threshold. According to Freddie Mac, the 30-year fixed mortgage rate rose to 6.48% from 6.42% in the last week of 2022. Although rates are more than double a year ago, rates will likely stabilize below 6% in 2023 as inflation will continue to slow down in the following months."   Lawrence Yun, NAR Chief Economist "Half of the country may experience small price gains, while the other half may see slight price declines," Yun said. "However, markets in California may be the exception, with San Francisco, for example, likely to register price drops of 10–15%." Yun expects rent prices to rise 5% in 2023, following a 7% increase in 2022. He predicts foreclosure rates will remain at historically low levels in 2023, comprising less than 1% of all mortgages. Yun forecasts U.S. GDP will grow by 1.3%, roughly half the typical historical pace of 2.5%. After eclipsing 7% in late 2022, he expects the 30-year fixed mortgage rate to settle at 5.7% as the Fed slows the pace of rate hikes to control inflation. Yun noted this is lower than the pre-pandemic historical rate of 8%. Lisa Sturtevant, Chief Economist for Bright MLS (Mid-Atlantic Listing Service) “We’re actually not seeing an outlook for prices to fall in the Washington area. Our forecast is for prices to be up about 1% year-over-year. The reason for that is we are seeing both side of the market contracting. Both the demand side and the supply side,” Sturtevant said.   

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