Bright MLS September Mid-Atlantic Market Report

Cool Down Accelerates in the Mid-Atlantic; High Mortgage Rates and Home Prices Proving to Be Too Much for Buyers

Home Price Growth Slowing, But Prices More Resilient in the Mid-Atlantic Than in Other Parts of the Country

• Home sales down 23% in light of steadily climbing mortgage rates; reach lowest level in eight years in Washington, D.C.
  
  
• Median days on market jump to 13 in region, highest since June 2020
  
  
• Median home price still up across the region up 5.7%; pace of growth slows to 2018 levels

ROCKVILLE, Md., Oct. 12, 2022 /PRNewswire/ -- Significant mortgage rate increases combined with rising home prices have ushered in a new housing market throughout the Mid-Atlantic region, according to the Bright MLS September Housing Report released today. In addition to double-digit declines in closed and pending sales, showings declined significantly last month, indicating that many home shoppers may have been priced out of the market.

"The shift in the marketplace accelerated in September, but the overall picture is a little complicated," said Dr. Lisa Sturtevant, Bright MLS Chief Economist. "Homes are staying on the market longer and buyers have more leverage than at any time since the start of the pandemic to ask for things like inspections and contingencies. But home prices are still rising because inventory is still very tight."

According to the Bright MLS T3 Home Demand Index (HDI), buyer demand continues to track lower than last year. The September HDI for the Washington metro area was 106, down from 130 a year ago, but up from 101 a month ago due to seasonal uptick in buyer demand for higher-priced single-family homes, townhomes, and condominiums.

As mortgage rates rise and prices remain high, the Washington area housing market is feeling the effects of a pullback in buyer activity. Regionally, both closed sales and new pending sales were at their lowest September levels in eight years.

Although down year-over-year, more sellers jumped into the market during the month of September with new listings surging 20.7% between August and September. Home prices in the Washington DC metro rose 3.3% year-over-year. As market conditions continue to be cooler than last year, it is likely that prices will fall from their peak in many local markets. Even if prices do fall, however, they will remain much higher than they were before the pandemic.

According to the Bright MLS T3 Home Demand Index (HDI), buyer demand has tracked lower than last year. The index for the Baltimore metro area was 101, down from 121 a year ago (Moderate) and down slightly from last month (107). Compared to last month, buyer traffic is down across housing types in the Baltimore region, with demand down most for higher-price homes.

Compared to other major metros in the Mid-Atlantic, housing market conditions in the Baltimore metro area appear to be more resilient amidst higher mortgage rates and uncertain economic conditions.

Prices are rising at a brisk pace. The median price in September in the Baltimore metro area was $364,900, up 7.3% compared to last year. Home prices in the region are now nearly 30% higher than they were three years ago.

The number of active listings in the Baltimore metro area has begun to increase, but inventory still remains at historically low levels in many local markets. Overall, the number of active listings in the region is less than half of what it was prior to the pandemic.

The Bright MLS T3 Home Demand Index (HDI) shows a seasonal decline in buyer traffic, which continues to be lower than a year ago. The forward-looking HDI for October for the Philadelphia metro area was 97, down from 111 a year ago and a decline from last month's index of 101.

With fewer buyers, homes are remaining on the market longer. In September, the median days on market in the Philadelphia metro area was 12. Buyers that remain in the market are taking their time, looking at multiple properties, and asking for seller concessions.

Price growth was firm in the region during September, with the median sales price up 6.5% compared to a year ago. Prices have remained surprisingly resilient throughout much of the region, despite rising mortgage rates.

While there have been modest increases in the number of active listings, supply remains at historically low levels. In September, all local markers with the exception of Philadelphia County have less than two months of supply

Full Mid-Atlantic and Metro area reports are available at BrightMLS.com/MarketInsights

Bright MLS was founded in 2016 as a collaboration between 43 visionary associations and two of the nation's most prominent MLSs to transform what an MLS is and what it does, so real estate pros and the people they serve can thrive today and into our data-driven future through an open, clear and competitive housing market for all. Bright is proud to be the source of truth for comprehensive real estate data in the Mid-Atlantic, with market intelligence currently covering six states (Delaware, Maryland, New Jersey, Pennsylvania, Virginia, West Virginia) and the District of Columbia. Bright MLS's innovative tool library—both created and curated—provides services and award-winning support to well over 100k real estate professionals, enabling their delivery on the promise of home to over half a million home buyers and sellers monthly. In 2021, Bright subscribers facilitated $141B in real estate transactions through the company's platform. Learn more at Bright MLS.com.

SOURCE Bright MLS