Home sales in the Washington region are climbing as the number of new contracts signed in October outpaced the five-year average for the month, according to a new housing report.
But housing prices continued a steady decline, likely a result of the new, lower limits on high-priced mortgages, according to the RBI Pending Home Sales Index released Thursday.
The 4,125 new contracts signed in October were 18.6 percent higher than the five-year October average and eclipsed the number of pending homes sales a year ago, when 3,829 contracts were signed.
| On an upswing | |||
| September | October | October 2010 | |
| Pending sales | 3,829 | 4,1253,669 | |
| Median price | $338,000 | $320,025 | $340,000 |
| Active listings | 14,791 | 13,953 | 16,629 |
Overall, pending home sales are stabilizing after the market was speeded up in 2010 by the first-time homebuyers’ tax credit, according to housing expert Corey Hart.
The summer’s swoon was typical of more traditional housing seasons, but the big jump in pending sales in October was a welcome change of pace, he said.
Pending home sales typically spike by 4.3 percent in October. But this year they jumped 10.4 percent.
“There’s generally a cycle in terms of hot summer seasons, and then in the fall it tends to drop back off,” Hart said. “It’s definitely good news that new pendings are up month over month. It’s not that it’s taking off like gangbusters, but it shows the relative stability of the local market.”
While pending sales jumped, the median sales price dropped to $320,025, down 5.9 percent from one year ago, stumbling again because of the high numbers of foreclosures and fewer sales of high-priced homes.
Foreclosures notices nationwide increased 10 percent from September to October, the highest activity in seven months, according to the foreclosure tracking firm RealtyTrac Inc.
The federal government on Oct. 1 made it more difficult to get high-priced mortgages through government mortgage lenders Fannie Mae and Freddie Mac, leading to fewer sales of homes costing more than $600,000, Hart said. Homes with sales prices under that mark haven’t been affected as much, he said.
Overall, housing prices are stabilizing as the market begins to settle. Active listings are down 16.1 percent to 13,953 from this time last year. It’s the lowest number of listings in the region since 1999.
“There’s actually almost a shortage in the D.C. area,” Hart said. “Active inventory has been falling consistently for some time now. Less homes are entering the market, which helps stabilize prices as there’s less negotiability between the buyer and seller.”
