Sales drop continues in June

Despite the rising temperatures outside, the housing market continues to cool. Last month, only 8,456 existing homes were sold in the Washington metropolitan area.

That’s a drop of 34 percent compared to June 2005. It’s the largest drop we’ve seen yet this year. In fact, I looked back through 15 years of sales data, and I couldn’t find another month when sales had fallen 34 percent.

Of course, we’ve never had a year like last year’s real estate market. When the market gets as heated as it did during the past few years, it has a lot of cooling off to do.

The market continues to drag more in Virginia than in Maryland. Sales in Maryland were off 26 percent last month, with the largest drop in Montgomery County. Sales there were down by 34 percent.

However, sales were down 43 percent in Virginia last month. The largest drop there was in 49 percent in Prince William County. The best a Virginia county could muster last month was a decline of 31 percent in Spotsylvania.

By comparison, the District is doing quite well, with sales only down 20 percent in June. Charles County was the only jurisdiction that did better than that, with sales down 18 percent last month.

Such a sharp decline in home sales has sellers in the area frustrated, and the number of additional homes coming on the market is only making matters worse.

In June, another 19,300 homes received for sale signs in their front yards. With less than 9,000 homes selling last month, you can see what sellers are up against.

However, the pace of new listings is slowing. During the first quarter of 2006, the number of homes listed in our area was 19,000 higher than in the first quarter of 2005.

In the second quarter of 2006, the number of home listings was up by just 9,000. So, we still have too many homes coming on the market — from a seller’s perspective — but at least the number isn’t growing quite as fast.

Contact Chris Sicks by e-mail (csicks@gmail.com).

The statistics in this story reflect a metropolitan area that includes the Maryland counties of Montgomery, Prince George’s, Anne Arundel, Howard, Charles and Frederick; the Virginia counties of Arlington, Fairfax, Loudoun, Prince William, Spotsylvania and Stafford; the city of Alexandria; and the District.