HousingWireHousingWire
The housing market in Washington D.C. is being closely watched amid widespread layoffs of federal government workers. Sweeping cuts by Elon Musk’s DOGE agency have sent many government employees packing, while other staff need to find housing in the area to comply with return-to-work mandates.
Will inventory levels skyrocket as federal workers leave? Or will they dwindle as workers relocate back from across the country? Altos provides weekly data that tracks exactly what’s happening in every major metro area, including the D.C. housing market. Let’s dive in.
Weekly housing inventory ramps up
What do we see in the data on housing inventory levels in the D.C. area? According to Altos data, inventory levels were slightly higher during the week of Feb. 28.Â
You’ll notice that the inventory for single-family homes and condos is up to 3,559 homes, which is higher than the week before. Inventory levels are also still higher than the COVID-19 inventory lows: In late February 2021, inventory levels sat at 2,414 single-family units.
But inventory remains well below historical averages. For example, from 2015 to late 2019, inventory levels remained above 7,000 for single-family homes. In addition, inventory levels regularly ramp up during this time of year.
New listings remain low as owners lock in
Altos’s data for new listings accounts for single-family homes that come to market without an immediate or pending contract.
New listings for single-family homes or condos are key indicators of seller behavior and new listings ramped up during the week of Feb. 28. Again, that upward trend is common for this time of year. In total, 502 single-family homes hit the market, followed by 457 condos.
Compared to the last few years, new listings are relatively the same. Around the same timeframe in 2024, 447 single-family listings were on the market. However, new listings are still lower than what we saw in the past few years.
What’s the reason for this? Low mortgage rates are keeping homeowners locked in as they seek to hold onto monthly payments they can afford. For example, in early May 2022 when 30-year mortgage rates were around 5.06%, there were 1,674 new listings on the market in D.C. With today’s average rate for a 30-year fixed mortgage at 6.54%, the number of listings is 73% lower.
Seasonally, inventory and new listings typically increase through May, so things should ramp up in the D.C. housing market over the next few months.
Pending home sales remain underwhelming
Altos weekly pending contract data offers greater insight into the trends in the D.C. housing market. Here’s the last four weeks of pending home sales:
- Week of Feb. 7: 596
- Week of Feb. 14: 655
- Week of Feb. 21: 596
- Week of Feb. 28: 598
Pending home sales can be influenced by a number of factors, including a weaker job market, in this case due to federal government layoffs. A lower share of workers means potentially less demand for housing. Pending home sales are also lower than previous years. In April 2022, pending home sales were close to 1,000, which is nearly 400 units higher than what we see for the week of Feb. 28.
Price reduction rate continues three-month decline
Normally, a lower share of for-sale inventory or a higher mortgage rate both correlate to more price reductions on the market. During the week starting on Feb. 28, the percentage of listings with home-price reductions ramped up slightly from the week before. Price reductions have steadily ramped down since December 2024.
What’s ahead for the D.C. market?
The D.C. housing market is experiencing volatility due to shifts in government employment caused by workforce reductions and return-to-work mandates. Inventory levels were slightly elevated last week, compared to the prior week. However, new listings, pending home sales and price reductions are below expectations, according to Altos data. Despite the challenges faced by the D.C. workforce, the D.C. housing market is not yet showing signs of stress.
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