Montgomery County’s housing market is beginning to show an increase in the number of new listings but local real estate agents say buyers remain stymied by a lack of inventory.
According to a July housing statistics report from the Greater Capital Area Association of Realtors (GCAAR), “prices and closed sales are up year over year, but there’s stability on the horizon.”
Last Tuesday, the association released its housing statistics for July for the county and the Washington, D.C. region. According to the report, there were 1,524 closed sales in the region, representing an increase of 3.5% year over year, and the average sale price for all residential properties was $836,200, up 6.8% from the same time last year.
Bruce Cotting, a Realtor with The Kensington Group and Chevy Chase-based RLAH Properties and member of GCAAR’s board of directors, told MoCo360 Thursday the county has been dealing with a lack of housing supply for as long as five years.
“COVID exacerbated the situation because everybody had the opportunity to move and now it’s sort of percolating down,” Cotting said. “We’ve got more people moving to the area than we have housing available and certainly we saw a strong uptick in new home sales.”
Comparing the summer to the same time last year, Cotting also said local real estate agents are seeing an uptick in houses going under contract and an increase in listings on the market. “But that demand [for homes] hasn’t caught up to that minimal increase [in listings] just over the last month or so,” he said.
In July, the median sold price for single-family homes in Montgomery County was $635,959, a 2.2% decrease from June but a 5.3% increase from the median sold price of $604,000 in July 2023, according to GCAAR statistics.
The average number of days that single-family homes in the county were on the market in July—17 days–remained the same as in June.
New listings were down from June to July, from 936 to 880 new listings in the county, but showed a more than 5% increase from the number of listings in July 2023.
The regional condo market remained stable from June to July, with the median sold price at $350,000 – a 3% increase from the same time last year. In addition, closed sales increased 12% from July 2023, from 2,201 to 2,465 closed sales, according to GCAAR statistics.
“My personal assessment is that we’re moving in the right direction in terms of seeing more and more listings start to come on the market,” said Cotting, who focuses primarily on the down-county area. “I hope that the sellers recognize that this is a strong push in the right direction, correcting the lack of inventory.”
Among those looking for new homes are families who need more space, Cotting said, and he thinks those buyers are helping by adding their own homes to the housing market.
“But those same buyers are hitting that challenge again. There is not enough out there. We’re finding that county buyers … who want to do the move up, or the reverse of that, [are] downsizing, there’s not enough for them to go after,” he noted.
As has been the case for several years, houses are going under contract as soon as they hit the market. Cotting said he has seen several situations in which a house was listed and “before you could show it, almost as soon as you scheduled a showing, the property was already under contract.”
Typically, in August, Cotting said, the housing market slows down and July’s activity will “erode” away. He suspects that buyers are waiting to see if interest rates will drop and if they do, there will be a “feeding frenzy” of home buyers.
“We’re past COVID now, and the impact that we’re still continuing to live from is the interest rates,” he said. “Interest rates started coming down in late July and in the beginning of August we started to see activity bounce back. But it’s certainly not where it would have been years prior.”
In the report, GCAAR President Christopher Suranna said that the association is “optimistic that lower mortgage rates could be ahead this fall,” providing an opportunity for more first-time homebuyers to enter the market.
“In the meantime, condos still present a more affordable option when compared to single-family,” Suranna said.