Our Local Real Estate Market Is Not Slowing Down

There’s so much going on in the world, it can be both confusing and overwhelming Despite this, our local real estate market is not slowing down – even with rising inflation, rising interest rates, fears of global oil or wheat shortages, or fears of a global conflict. Quite astonishingly, the state of our local real estate market is strong!

 

At the heart of this unprecedented surge in real estate prices (rival appreciation rate to that of 2003-2005) is a fundamental factor: a significant drop in the availability of homes for sale. Fewer people are moving, fewer older folks are downsizing to apartments or condos. And there is no clear-cut answer on when this dynamic may change.

 

A quick look at the numbers illustrates these factors at play. Between January 1 March 17, 2021, 349 new contracts were entered into in Bethesda-Chevy Chase and Potomac (detached homes, all price ranges). In 2022, during the same time period, only 267 contracts were signed – that’s a 23.5% drop year to year.

 

Moreover, the average list price (not sold price) in 2022 was $1,581,000, and for those that have closed since the beginning of the year, on average the sold price was 7.5% higher than the ask. In comparison, during the same period in 2021, the average asking price was $1,477,000 and on average the sold price was “only” 2.6% higher than the asking price. If you do the math with me, the spread on average year over year grew to $184,000, or a 12.15% jump.

 

While sellers are the big winners, buyers on the other side are feeling the squeeze, and “buyer fatigue” is growing. A buyer today must prepare emotionally, mentally, and financially to bid up (by a lot) and waive all contingencies. meditate and pray to the gods. They also need a savvy, well-networked, and widely respected real estate agent on their side! Galanti Group stands ready to be your partner in navigating this most unusual market.