- The Washington Times - Thursday, August 18, 2005

The Washington-area homes market slowed last month, and this time, I believe there was more to it than just summer vacations.

Each year, the summer real estate market is slower than the spring market.

It’s just the cycle our region follows, year in and year out.

So, when June’s sales fell 9 percent compared to May, it didn’t mean the market was shutting down.

June’s sales still beat June 2004 by 2 percent.

Now, however, I have July’s data in hand. After studying the figures, I still will declare that the market isn’t shutting down — but it does seem to be cooling for the first time in years.

Existing-home sales totaled 11,415 in July, a decline of 10 percent compared to June. Again, this is mostly because of the usual summertime slowdown.

However, July’s sales also were down compared to July 2004.

For the first time this year, sales have fallen behind last year’s pace.

It was just a decrease of 4 percent, but that drop could mean the market is no longer expanding.

If buyer interest is waning, it will mean sales will continue to slow and prices will stop rising as quickly.

You probably know I’m not one to seize upon a single statistic and draw sweeping conclusions from it. However, not only were sales down last month — inventory was up.

The number of homes on the market on July 31 was 19 percent higher than last year, and that is an indication that supply is rising faster than demand.

For now, things are improving for buyers, but the Washington-area market still favors sellers by a wide margin.

The number of homes for sale is very low, and buyers are still bidding fiercely for homes.

In the coming months, we’ll learn whether their ferocity has begun to fade.

Chris Sicks

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

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