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hoto-Illustration by Connie Zheng with photographs by Getty Images.
The current state of the Washington real-estate market is unlike anything seen before, insiders say. Some homes linger on the market, while others are snapped up in a bidding war, often for no apparent reason. "Since about the third week of September 2023, the market has been unpredictable," says Brett West, an agent with McEnearney Associates. "Houses that were expected to sell quickly sometimes sit for ten days or two weeks, and sellers get worried."
One of West's listings sat on the market for 79 days despite being priced lower than comparable homes nearby, while a similar listing sold in four days. A one-bedroom condo in North Bethesda listed by Morgan Knull had no interested buyers for weeks before selling at full price to a cash buyer.
The usual drivers of sales – location, price, and neighborhood – are still at play, but high mortgage rates and limited inventory have added complexity to the market. "Everyone just needs to get used to changes in the market," says Corey Burr, a senior vice president at TTR Sotheby's International Realty.
Buyers' concerns about crime and schools in the District have contributed to a weaker market in the city compared with the suburbs. However, this presents an opportunity for buyers who want to live in DC, as many neighborhoods have great housing stock and more relaxed prices than in recent years.
For example, West sold an upgraded five-bedroom house on 16th Street Heights for $1.45 million, significantly lower than its original asking price of $1.975 million. Another property in the neighborhood sold for $1.1 million, but West had anticipated it would sell for more than $1.2 million.
High-density neighborhoods like Trinidad and the H Street corridor are undervalued now, according to West. Condos, particularly in the District, are also struggling due to high mortgage rates and limited down-payment assistance programs.
Buyers can take advantage of the current market by negotiating prices, having home inspections, and asking sellers to buy down interest rates. For buyers with deeper pockets, there may be opportunities on the upper end, as luxury homes are taking longer to sell than lower-priced options.
Sellers need to get their homes in prime condition, stage them properly, and price them realistically. Some agents recommend pricing a home slightly under its estimated value to generate multiple offers and drive up the price. To avoid having contracts fall through, sellers can ask for larger deposits or make them nonrefundable.
Buyers can add an escalation clause to automatically increase their offer above others, use VA loans strategically, and shop around for lenders to compare rates and terms. By being informed and adaptable, buyers and sellers can navigate the current market's unpredictability and find opportunities in a shifting landscape.
