I could tell you how Washington DC had an influx of population in 2009. I could tell you how strong the job market is in Washington DC. Or I could even tell you how real estate prices were up 2.9% in Washington DC last year. Instead I am going to regale you with some anecdotal stories to illustrate what is going on here in the real estate market.
There are certainly some pockets in the Washington DC area that suffer soft to weak prices. And it seems the further you push out into the suburbs, the weaker the prices. And I am sure that is due to the seeming trend of people flocking to urban centers, and wanting to be as close in as possible. But the really interesting stories are the anecdotes that you won’t see in the statistics.
1. In a town north of Rockville, MD there was a house with an asking price of $695,000. It has been on the market for 3 days. There were 3 offers, and my clients got the house, and bid $20,000 over the asking price and paid $715,000! And this was a house that all parties knew was only worth $635,000 because the exact same house just sold 3 months ago for that very price. But all the buyers overbid, and were comfortable paying well over appraised value, even over the asking price. That is on how in demand this house was.
2. A house on Capitol Hill that was put on the market late last year was intentionally priced low by the listing agent. The Realtor thought the house was worth $600,000-$610,000, they priced the asking price at $539,000 to try and stand out. It drew so much attention that there were 9 bids, and the final selling price was $639,000! It ended up selling over what even the Realtor thought it was worth!
3. There was a renovated home in Northwest Washington DC that sold in a matter of days, for full asking price, no appraisal contingency, no financing contingency, and a 21 day settlement.
4. And if I have heard the below once, I have heard it dozens of times, this year alone: “Hi Brian. Unfortunately, we didn’t win the contract. We put in what we thought was an aggressive offer, but there was a better one. We’re going to continue looking and will keep you updated on when we plan to put in our next offer.”
I could write pages of these examples. And I don’t mean to mislead, since I can tell just as many stories of properties that sit and sit on the market for months, quarters, even over a year. I can site examples of weakness from Falls Church, Alexandria, P.G. County, Anne Arundel County, Loudon County, Calvert County and more. And there are even some examples of properties sitting on the market in Washington DC, but those are usually homes where the seller has grandiose ideas, has over priced the home, and simply won’t budge.
I could also site examples in those weaker markets in the suburbs of some homes selling quickly, and for strong prices, but those seem to be the exception to the rule, and seem to be very nice properties.
The moral of the story is that the inner city is very strong in all the good neighborhoods, and the suburbs seem to be weaker in general.
But, a fairly priced home, no matter where it is located, will sell, and will sell quickly. But the tricky part is getting a seller to price fairly. It is human nature for all of us to think that our home, our renovations, our neighborhood, and our general area are special, and deserve a price premium. The marketplace ultimately decides what the fair price is, and its an interesting experiment to witness!