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Ask McEnearney: How was the real estate market for the first half of 2023?

This week’s Q&A column is written by David Howell, Executive Vice President and Chief Information Officer, of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant market news, contact David at 703-855-5089 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: How was the real estate market for the first half of 2023?

Answer: As we wrap up the first half of the year, the low inventory of available homes for sale continues to be a dominant factor in the local market. Despite the significant pullback in contract activity because of interest rates that edged near 7% by the end of June, home prices in Northern Virginia still rose in June and have risen year-to-date.

It is a great market for motivated sellers, but a challenging one for buyers who are dealing with higher home prices and high interest rates. The imbalance won’t stay this way forever, but it’s going to take a drop in mortgage rates to unleash the pent-up demand from buyers and sellers alike.

This week we look at market activity for January-June of 2023 compared with the same time in 2022 for the City of Alexandria and South Alexandria (Fairfax County portions of Alexandria). The charts below show contract activity by price range and by property type (condos, attached homes, and detached homes) and the average days on market.

City of Alexandria

New Contract Activity

  • Contract activity in the City of Alexandria decreased 27.2% in the 1st half of 2023 compared to the 1st half of 2022.
  • Contract activity was down for all price categories.

Number of Condo, Attached Home, and Detached Home Contracts

  • The number of detached homes, the smallest part of the Alexandria City market, going under contract in the 1st half of 2023 decreased 17.1% compared to 2021.
  • Contract activity in the condo market decreased 27.7% and attached homes activity decreased 31.2%.

Average Number of Days on the Market — New Contracts

  • Overall time on the market increased 20.3% to 24.9 days for the 1st half of 2023.
  • The average number of days a home was on the market before receiving a contract decreased for one price category.

South Alexandria — Fairfax County Portions of Alexandria

New Contract Activity

  • “South Alexandria” refers to those portions of Fairfax County with an Alexandria mailing address.
  • Contract activity decreased 25.0% in the 1st half of 2023 compared to the 1st half of 2022.
  • Contract activity was down for all price categories.

Number of Condo, Attached Home, and Detached Home Contracts

  • Condo contract activity decreased 28.0% in the 1st half of 2023 compared to the 1st half of 2022.
  • Attached home activity decreased 24.7%, and detached home activity decreased 23.5%.

Average Number of Days on the Market — New Contracts

  • The average number of days a home was on the market before receiving a ratified contract increased for five price categories.
  • Overall time on the market increased 135.9%(!) to 30.9 days for the 1st half of 2023.

Note: Data derived from BrightMLS and is deemed reliable, but not guaranteed.

If you would like a question answered in our weekly column or to set up an appointment with one of our Associates, please email: [email protected] or call 703-549-9292.

McEnearney Associates Realtors®, 109 S. Pitt Street, Alexandria, VA 22314. www.McEnearney.com Equal Housing Opportunity. #WeAreAlexandria

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