Concerns about federal job cuts leading to a jump in homeowners deciding they need to sell are valid. During the week ending Feb. 22, the number of new listings to hit the market in the D.C. area jumped 20% from the previous week.
But weekly data, now being released by regional listing service Bright MLS in response to growing concerns, will help paint a better picture of the effects going forward than the traditional monthly housing market reports — but not this soon.
“I would urge caution,” said Lisa Sturtevant, chief economist at Bright MLS. “One week’s worth of data does not tell us something dramatic is coming in the housing market, but it is illustrative that there might be changes on the way with more inventory.”
One caveat on the weekly change in new listings: While the percentages look big, the numbers they’re based on are small.
For example, the 200% jump in new listings in Virginia’s Manassas Park City is based on just six new listings. The 50% jump in nearby Fairfax City was based on nine new listings.
The increase in new listings last week was also led by the outer suburbs, with listings remaining stable closer to D.C., in places like Arlington and Alexandria.
This may be a preview of the effects of another change in the federal government workforce: the new return-to-the-office mandates.
“We’re going to watch this. This could be a sign that more federal workers who are having to commute into D.C. may be deciding to make a switch and sell their home further out and move closer in,” Sturtevant said. “But it is a little too early to tell.”
There was another yellow flag worth keeping an eye on in the most recent weekly report from Bright MLS. Among active listings (homes already on the market last week) 7.5% had a price drop.
“And that could be a sign that some sellers are feeling uncertain about where the market might be heading and they are eager to sell their home now before they have to make further price adjustments,” Sturtevant said.
More homes on the market, and even a modest pullback in price gains, would be welcome for would-be buyers in the D.C. area market. And there are potential buyers out there. The number of home showings by real estate agents during the week ending Feb. 22 — more than 25,000 of them — went up 21% from the previous week.
“While there are people who are reacting to what is going on with the federal workforce, with some of the cuts and with the return to the office, there are other homebuyers out there who have been waiting for the opportunity to get into the market, and we are seeing there are still a lot of active buyers out there,” she said.
Almost 1,400 homes on the market in the D.C. region went under contract during the week ending Feb. 22 — 1.1% higher than the previous week. Fairfax County, the region’s most populous jurisdiction, accounted for 255 pending sales last week — an 8.5% jump from the previous week.
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