Mid-Atlantic Housing Market Update for September 2024
New pending sales higher while prices continue to rise
The number of home sales in the Mid-Atlantic has remained steady compared to last year, but there's promising news on the horizon. New pending sales are showing a notable increase, which indicates that market activity is likely to increase as we enter the fourth quarter.
In September, there were 19,945 new pending sales recorded in the Bright MLS service area, representing an increase of 10.3% compared to the same period last year. A significant factor contributing to this rise is the decline in mortgage rates, which have dropped by over a percentage point since spring, encouraging more buyers to participate in the market.
Market conditions have eased for home buyers. The median days on the market have decreased to just 13 days, which is four days longer than the previous year. Although the pace is slower, buyers are still finding the market competitive. Historically, before the pandemic, the median days on the market hovered around 25 days.
Home prices in the region continue to rise as well. The median sold price in September reached $410,000, a year-over-year increase of 6.4%. Seasonal fluctuations are apparent though; there was a 1.9% decline in median prices from August to September.
Conditions are evolving nicely for buyers in this region. With mortgage rates at a 20-month low in September—now just above 6%—prospective homebuyers can anticipate savings of approximately $300 on their monthly payments for a median-priced home in the area. More buyers are emerging in the market, leading to an uptick in home showings and offers.
Dr. Lisa Sturtevant, the Chief Economist at Bright MLS stated, "There are many prospective homebuyers who have been waiting for mortgage rates to fall. The recent drop in rates has motivated processes for both home buyers and sellers, meaning we can expect a busier fourth quarter."
Moreover, inventory levels have been steadily increasing for eight consecutive months in the Bright MLS service area. By the end of September, there were 38,205 total active listings, marking a 16.8% increase year-over-year. However, it’s important to note that this current inventory is still just over half of what it was in 2019.
Impact of Falling Mortgage Rates
The primary driver behind the rising home prices in the region is the ongoing tight inventory situation. The median sold price remains elevated at $410,000, down from the peak in the summer but still about 6.4% higher year-over-year.
As mortgage rates decline and inventory levels rise, it sets the stage for increased buyer activity. There is optimism that these last months of the year will close out stronger than the previous year, though affordability remains a challenge for many buyers. It is projected that prices will continue to trend upwards, which may shift buyer interest toward more affordable markets.
Regional Insights: Philadelphia, Baltimore, and Washington, D.C.
Philadelphia:
The lower mortgage rates and increased inventory have placed Philadelphia in a positive light, providing opportunities for buyers. In September, the region recorded 5,660 new pending sales—up by 5.9% from the previous year. Despite the rising activity, the area still grapples with low inventory, which has not returned to pre-2019 levels.
In terms of prices, the median sold price reached $379,900, up by 7% compared to last year, indicating strong demand even with seasonal adjustments.
Baltimore:
While sales in the Baltimore metro have been sluggish, September revealed a hopeful uptick. There was a 10.6% increase in new pending sales compared to last year, even though year-to-date sales are still down 2.2%. The inventory in this area has seen a continuous rise, with 4,978 homes available for sale at the end of September (an 18.5% increase year-over-year).
Home prices in Baltimore are on the rise, with a median sold price of $397,855—up 4.7% since last September.
Washington, D.C.:
The Washington D.C. area has experienced a surge in activity, with new pending sales increasing by 15.7% in September compared to last year. The region has also benefitted from falling mortgage rates, prompting more buyers to enter the market.
Home prices remain high in this metro area, with a median sold price of $599,000, representing an 8.9% year-over-year increase. Affordability, however, remains a pressing concern for many potential buyers, particularly first-time entrants.
Conclusion
The Mid-Atlantic real estate market is demonstrating resilience as falling mortgage rates and increasing inventory combine to stimulate buyer interest. With the current conditions, it's an exciting time for many prospective homebuyers as the market gears up for a bustling fourth quarter.
Frequently Asked Questions
What is the current trend in the Mid-Atlantic housing market?
The market is seeing an increase in new pending sales, driven by falling mortgage rates and improved inventory levels.
How much have mortgage rates decreased in recent months?
Mortgage rates have fallen to just above 6%, a 20-month low, providing significant savings for buyers.
What does the rise in new pending sales indicate?
It suggests increasing buyer confidence and activity in the housing market as conditions improve.
How are home prices trending in the Mid-Atlantic region?
Home prices continue to rise, with a median sold price of $410,000 in September, marking a 6.4% increase year-over-year.
What areas are experiencing notable changes in the housing market?
Regions such as Philadelphia, Baltimore, and Washington D.C. are seeing varied activity, all influenced by the declining mortgage rates.
