New algorithm ranks DC area home demand, and it’s extremely high

Residential real estate listing service Bright MLS has developed a new index designed to be a forward-looking indication of homebuyer demand, and in the D.C. area, the index remains in the red.

The T3 Home Demand Index does not track sales. Instead, it tracks pre-sale activities, including home showing requests, home searches and views within Bright MLS’s own listings, which cover the bulk of all area homes that are on the market. The index has a five-level range from limited to high demand.

The index was set to a baseline score of 100 in March when it was launched.

In May, the D.C. area index stood at 147, and the high end of the high-demand range. It was down 7% from April, but in May of 2020, the index was parked in the middle of “moderate” on the demand index. It indicates demand is 20.5% higher now than it was the same time last year.

Bright MLS’s traditional sales data shows the median selling price of a home in the D.C. metro in May was $570,000, 3.6% higher than April, 14% higher than May 2020, and 18.8% higher than May 2019.

Closed sales in the D.C. region in May were up more than 62% from a year ago, and pending sales, contracts signed to buy a home but not yet closed, were up 37.3%.

Homes also continue to sell at a record pace, with a median days on market of just 6 days.

The good news for buyers is that the number of new listings that came on the market in May was up 44.8% from May of last year, though new listings did fall 5.9% from April.

Sellers in the D.C. area market continue to get what they want in terms of price, with the median selling price last month 4% over the median list price. Bright MLS said demand remains strongest for single-family homes, with 60% of listings selling for over original list price last month.

Virginia’s Arlington County remains the most expensive housing market in the D.C. region, with a median selling price of $725,000 last month, 16.5% more than May 2020.

Below is the Bright MLS T3 Home Demand Index for May, and median selling prices around the D.C. region, courtesy of Bright MLS:

Demand for real estate remains high in the D.C. region. Click on the graphic to enlarge. (Courtesy Bright MLS)

 

Here’s a look at median prices in the D.C. area. Click on the graphic to enlarge. (Courtesy Bright MLS)

Jeff Clabaugh

Jeff Clabaugh has spent 20 years covering the Washington region's economy and financial markets for WTOP as part of a partnership with the Washington Business Journal, and officially joined the WTOP newsroom staff in January 2016.

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