Mid-Atlantic housing inventory increases for 2nd month in a row, report shows

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Fueled by more new listings, housing supply has increased for the second month in a row in Maryland and the mid-Atlantic region, according to a report released Wednesday by the North Bethesda-based real estate organization Bright MLS.

Despite elevated mortgage rates and the “lock in” effect, changing family or financial situations are leading more homeowners to list their home for sale. More inventory is a welcome sign for homebuyers in the mid-Atlantic, but overall supply is still low, the report shows. The number of active listings at the end of March was less than half of what was available at the end of March 2019.

There were 21,892 new listings that came onto the market in March, which is 7.1% fewer new listings than last March. However, new listings have increased month-to-month since the beginning of the year. And the number of new listings coming onto the market outpaced those coming off as new contracts.

In March there were 21,412 new pending sales across the Mid-Atlantic, close to last year’s level and up 21.5% between February and March.

Bright MLS Chief Economist Dr. Lisa Sturtevant said more sellers are coming into the market, despite interest rates still in the high 6% range. She said while many homeowners are still holding onto their very low mortgage rates, there are others who are deciding that they need to move.

After two months of flat closed sales, the number of closed sales in March fell by 11% year-over-year. However, sales did increase by 20.4% between February and March, which is a typical seasonal pattern and an indication that buyers are out there despite elevated rates.

Mortgage rates will stay higher for longer, as the Federal Reserve will probably delay rate cuts until July, the report shows. Expect rates to come down in the second half of 2024 but remain above 6% this year. Even a modest drop in rates will bring both more buyers and more sellers into the market.

The median home price in the Baltimore metro area rose faster than it has since June 2021, the report shows. The median price of homes sold in the Baltimore metro area in March was $370,000, up 10.4% compared to a year ago. Prices rose across the region, with the fastest price growth in Howard County (+16.5% year-over-year).

The pace of the housing market in the Baltimore region remains brisk. In March, half of the homes sold across the region sold in eight days or less. Only Baltimore city had a significantly slower market, with a median of 19 days on market.

Inventory is increasing in the region. At the end of March, there were 3,635 total active listings on the market, up 4.2% from a year ago. However, the number of new listings is still below the number of new pending sales, which suggests supply will continue to be tight in the Baltimore region.

The median sold price in March in Montgomery County and the Washington metro area was $599,990, up by 10.1% in March, the fastest pace of home price growth since February 2022. Prices were up in all jurisdictions with the exception of the District of Columbia (-0.1% year-over-year change).

New listings outpaced new pending sales in March, which is what led to growing month-end inventory. The number of new listings also increased between February and March, which is a typical seasonal pattern heading into the spring market.

Homes continue to sell quickly in the competitive Washington metro area market, the report shows. Half of all homes sold in March were on the market a week or less.