- The Washington Times - Thursday, July 1, 2004

Washington-area home sales reached an all-time high in May, as buyers competed fiercely for a paltry number of homes for sale. Despite high prices and a difficult buying climate, the area’s real estate market continues to break records.

Existing-home sales in May totaled 13,473 — the highest monthly total in history.

Sales have doubled since May 1998 and quadrupled since May 1995.

Undoubtedly, home-sales figures would be even higher if there were enough supply to meet this level of demand, but because sales have been so strong, homes don’t stay on the market very long, which limits the available inventory.

Inventory has been at a record low all year. On May 31, there were only 13,406 homes on the market in the area. That’s a 20 percent drop compared with May 31, 2003. Looking back to 1998, you would find more than 34,000 homes sitting on market, waiting to be sold.

That was the last year of a decade-long buyer’s market, a time when there were plenty of homes to choose from and few buyers trying to snatch away the home of your dreams. Back then, buyers would see a home on Sunday, talk about it all week, and maybe make an offer on Saturday. Often, they would get it, even if they offered less than the asking price.

Today’s buyers can only wish for that kind of time — and those kinds of prices. Buyers now have to make up their minds in hours if they hope to beat the competition. And they often need to be ready to pay thousands more than the asking price to win the home.

The numbers for May illustrate clearly what today’s buyers face. On the fever chart, you’ll notice that the lines for sales and inventory meet. That’s because monthly sales equal or exceed the inventory on a given day. This is a situation we’d never imagined in the mid-1990s, when inventory was typically five to 10 times higher than sales.

This comparison between inventory andsales is something I call “sales chances.”

In May 1995, for instance, inventory was 35,000 and sales were only 3,500, resulting in a sales-chance figure of just 10 percent. Today, when homes in many jurisdictions are selling in two weeks or less, sales chances of more than 100 percent have become relatively common.

Chris Sicks

• 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.

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