Government Shutdown October 2013

Government Shutdown October 2013

Strictly going by the manner of the media, one would think the market is in shambles. This is not true, however, people are feeling pessimistic about the market as this summer brought a 1% rate increase, a potential sequester looming and the current government shutdown. The real issue in the D.C. market is the lack of available inventory. There has been a slight increase in supply from the slow summer months, but based on current trends and historical standards, we have hit a low point in regards to inventory. Depending on your location and price point, we’re coming off a two year stretch of inventory being down 20-30%. Although this is only one factor, it’s very powerful especially in terms of the current bumps we’ve been hitting.

In addition, even with the government shutdown, D.C. remains one of the best job markets in the country. In a robust job market with very young and strong professionals, having a job provides all the confidence for buying or renting a home. This provides a lot of room for growth and development. Another strong part of the market is the builder segment. Builders are still putting up condos and individuals are continuing to purchase homes on the resale market to flip.

Overall, the market is a mixed bag with very strong forces moving in both directions. The strongest factors appear to be the stable job market and the lack of inventory. The supply issue makes purchasing harder on buyers but works favorably for sellers. The rates are still historically low and hovering between 4.5-4.75% in most loan scenarios. This is still encouraging and the market appears to be balancing out.

If you have any other questions, please contact me as we are the top Keller Williams team. Thanks and I hope to see you out there!