Case-Shiller: DC Home Prices Post Steady Drop in January

Let’s check in on the S&P/Case-Shiller Home Price Indices (HPI).

For an explanation of how the Case-Shiller data is calculated, check out their methodology pdf. Also remember that the data released on the last Tuesday of a given month is for the period two months prior (i.e. – January data is released in March).

Here are the basic Case-Shiller stats for the Washington DC area* as of January:

January 2009
Month to Month: Down 2.5%
Year to Year: Down 19.3%
Change from Peak: Down 31.5% in 32 months

The following chart shows the DC area HPI scaled such that the May 2006 peak is 100% on the y-axis. Data on the x-axis is scaled to display the last time (pre-peak) the DC area HPI was at or lower than it was in the latest data (February 2004).

Price declines in the last few months of data have actually been relatively mild in and around DC, compared to what we’re seeing in other markets around the country. In addition, the drop from December to January held a pretty steady rate that DC has seen since about September. At least it’s a form of “stability,” right?

Here’s a chart of Case-Shiller HPIs for all the markets that Redfin serves, so you can compare the DC area’s performance to other areas across the country:

And here’s our final chart, in which we line up the peak Case-Shiller HPI value for each of Redfin’s markets, so we can see how long each market has been declining, and how much it has dropped from the peak.

DC price declines continue to track fairly close to what we’ve seen a few months back over on the West Coast in San Diego. I highly doubt there is any real causal effect at play here, but it is still interesting nonetheless.

*[Case-Shiller defines Washington DC as the entire Washington-Arlington-Alexandria, DC-VA-MD-WV Metropolitan Statistical Area, which includes all of the District of Columbia and all or part of the following counties: Calvert MD, Charles MD, Frederick MD, Montgomery MD, Prince Georges MD, Alexandria City VA, Arlington VA, Clarke VA, Fairfax VA, Fairfax City VA, Falls Church City VA, Fauquier VA, Fredericksburg City VA, Loudoun VA, Manassas City VA, Manassas Park City VA, Prince William VA, Spotsylvania VA, Stafford VA, Warren VA, and Jefferson WV.]

The Best DC Area Real Estate Blogs

We did some research on the best real estate blogs in the DC area. Here’s a list of our favorites:

Best Real Estate Blogs

• Urban Turf “publishes daily articles, news, and commentary about the DC metropolitan residential real estate market.”
• DC Home and Condo prices a blog “to help buyers and sellers understand the current real estate prices in the neighborhoods they’re considering.”
• Open House Blog “real estate, interior design, and the home in the Washington, DC area.”
• DC Metrocentric “New Buildings, Construction, Destruction, Planning, Real Estate, and Gossip as it happens in the Nation’s Capital.” Also has a fun PriceChecker section where you can take a stab at guessing list prices.
• Rebuilding Place in the Urban Space blog about land use planning and public transportation.

Best News/Neighborhood Blogs

• DCist news, events, food, art.
• Prince of Petworth “chronicles the happenings in Washington DC’s neighborhoods” including real estate and new developments.
• And Now, Anacostia “a blog for Anacostia, DC. Just you wait and see.”
• JDLand redevelopment and revitalization in Southeast DC.
• In Shaw “stuff about the immediate hood (Truxton Circle) and the surrounding neighborhood (Shaw), gentrification, demographics, and some history.”
• New Columbia Heights community news and entertainment.
• District, Schmistrict 20somethings blog about life in Logan Square.
• Penn Quarter Living “daily news site about the Penn Quarter in downtown Washington DC.”
• The Triangle “not just parking lots anymore…”

Good Agent Blog

• DC Metro Urban Diary “… because real estate is the porn of our urban lives.”

What did we miss? What blogs do you read to keep track of the DC real estate scene?

Redfin Open Houses this Sunday

Looking for a place in the city? Check out this great 2 bedroom, 2 bathroom high rise in the heart of Gallery Place.

Open Sunday, March 29 1p.m. – 4p.m.

777 7th St Northwest #324 Washington, DC 20001 $575,000

March City/Neighborhood Price Reductions

Let’s take our monthly look at which cities and towns have the most price reductions.

The following charts show the percent of MLS, FSBO or REO listings that were price-reduced at some point before leaving the market (either sold or removed unsold from the market) in the past 90 days. Cities/towns or neighborhoods in which the number of homes taken off the market was too small to provide believable estimates are excluded from ranking.

For those that are interested, I have uploaded the full data set in Excel format here. The downloadable Excel file also includes charts showing the top ten cities/towns/neighborhoods with the least reduced-price listings.

First up are the top ten cities with the most price-reduced listings:

Of the 229 cities/towns we ranked in the DC area this month, 167 (73%) had price-reduced ratios of fifty percent or more. East Riverdale and Camp Springs held their #1 and #2 spots this week, way out ahead of the pack with three quarters or more homes leaving the market with price reductions in those neighborhoods.

Getting a little more granular, let’s look at the top ten DC area neighborhoods for price reductions:

Of the 123 neighborhoods we ranked in the DC area this month, 67 (54%) had a price-reduced ratio of fifty percent or more. Five of the top ten carried over from last month. These are the neighborhoods where you might want to look for sellers that are more anxious to sell.

We’re still seeing a degree of consistency in which neighborhoods and cities have the most price reductions. Are sellers in these locations just not very good at finding the right market price in the first place, or are they so anxious to sell that they drop the price early and often? Either way, the regions with the really high percentage of reduced-price homes are probably a good place to go bargain-hunting.

Biggest Discounts March Update

Let’s have an update on where buyers are currently getting the biggest discount off the asking price. Our goal in sharing this data is to help potential buyers to know which neighborhoods are softer in terms of sale price discounts off list price, to better equip you when making an offer, and help you know where to look for potential bargains.

In the chart below, we have taken all sales data from the last two months in Redfin’s DC service area and sorted it by zip code. We calculated the overall difference between the sale price and the list price. Note that this reflects the final list price, after all price drops in the listing. Any zips with fewer than ten sales are excluded from the top and bottom ten rankings, but interested readers may download the full data summary in Excel format (xls).

For a quick look at where a given zip code is located, just type it into the Redfin search box, or drop by the handy USNaviguide.com zip code map.

Here are the top ten zip codes with the largest overall discount:

The overall discount for the DC area held steady from last month right at 4.0%. At 8.9% off, this month’s least-discounted zip code in the top 10 saw almost as big a discount as the most discounted zip code last month. Some buyers are striking hard bargains out there.

Here are the ten zip codes with the smallest discounts:

Of the 11,468 sales we tracked in the 2-month period, 297 homes sold for more than 20% off the asking price, while 2,345 homes sold for more than asking.

As a whole, the discount trend in DC seems to be holding pretty steady. As we continue to watch this data we will be able to get a better picture of what sale-to-list discounts tell us about the overall health of the local real estate market. Once we get enough data points, we’ll be able to plot the overall discount trend on a line chart for an interesting picture of the market.

Redfin’s DC Area February Update: 225 Homes Toured, 31 Offers

Beginning with February, Redfin is publishing monthly DC Area real estate stats, summarizing what we’re up to in the market, and how the market is changing. This is our first crack at it, which means we’ll only present a few numbers for February.

Market Activity

• 20,097 new MLS listings (the current total is 82,291).
• 17,602 price reductions.
• 63,145 homes were added to DC Redfin users’ favorites list.

Brokerage Activity

• 255 homes were toured by our clients through Redfin field agents.
• 23 people attended our monthly home buying class.
• 31 clients made offers.
• 11 clients responded to our customer-satisfaction surveys and posted an online review.
• 93% of our February DC Area clients would recommend Redfin to a friend.

What else do you want to know? Your comments and suggestions are at the core of our goal to better serve our customers. We’d love to hear from you. If you haven’t already, join the DC Redfin forum and sign up for listing alerts and our monthly newsletter. As always, thanks for using Redfin!

Redfin Now Services REOs in DC!

Hello Dear Friends,

Good news! Redfin is now touring and working with MLS listed bank-owned foreclosures and REOs (real estate owned) in the MD, DC and VA markets. Previously, we had shown these homes for sale on our site but restricted our clients from touring or offering on these properties. At first, we were worried about overwhelming our capacity (both on touring and offering) and our early experiences with the banks had been less than favorable. Fortunately we now have the staff and experience to handle this demand while still delivering fanatical customer service. Also, we’re happy to report that banks have actually improved the way they handle REO sales in the past six months.

Just how many bank-owned foreclosures are there in the DC area? Stats man, Mose Andre, took a look at the percentage of single-family residence homes for sale that are being sold by a bank as indicated by a flag in the local MLS and by scanning the text of the listing for terms like REO, foreclosure, foreclosed, etc.:

To assess the effect that foreclosures were having on the remaining inventory, we graphed in green the average asking dollars per square foot for listings on the market, excluding bank-owned listings. Since we measured price changes in terms of average dollars per square foot, we excluded any listings where the square footage was zero.

For more information on bank-listed foreclosures and REOs, check out our recent blog post on REO pricing, negotiations, and what it’s like to work with banks. While you can get a great deal on an REO home, remember that banks won’t be paying for any repairs (like the mold damage found by some Redfin Forums readers). There are tricks to success; so do your homework, ask a lot of questions, and be ready to pack your patience!

When you see a bank-owned property on our site and want to take a tour, please let us know by clicking the Go See This Home button on any home or by contacting one of our lead agents! If you have questions about our new policy or any heartfelt suggestions, please post them here or contact us directly.

I know this has been a frustration for a number of users. Although we are not going to change our minds about short sales anytime soon, we now welcome and embrace working with REOs.

Thank you,

Alex Coon
Market Manager