- The Washington Times - Wednesday, February 23, 2005

Last month, I speculated that Washington-area sales chances for January would likely exceed 80 percent. If

January proved to be that competitive, it would be a sign that 2005 could be an even more competitive, difficult real estate market than 2004’s market was.

Now that I’ve studied the data from last month, I’m shocked. Sales chances hit 113 percent for the metropolitan area, exceeding 150 percent in three jurisdictions.

No month on record, not even the typically busy months of March through May, has ever seen sales chances of 113 percent. That means last month was even tougher for buyers than March 2004.

Sales chances are my way of measuring the level of competition in the real estate market. Dividing sales figures for the month by the inventory on the last day of the month results in a percentage; a figure below 20 percent indicates a buyer’s market. Higher figures mean we’re in a seller’s market.

For instance, on a typical January day in Prince George’s County last month, a buyer would find about 700 homes from which to choose. A total of 1,081 homes were sold in Prince George’s last month. So the sales chances there were 155 percent. If there was a home on the market there in the first week of January, it was most likely sold by the last week of January.

Area home sales themselves were rather normal last month — up 1 percent over January 2004 but a little lower than January 2003. The unprecedented sales chance figures this January were caused by a severe shortage of homes for sale.

Only 6,000 homes were placed on the market last month, compared with 8,800 in January 2004. And last month began with a handicap, due to low inventory in December.

So, by the end of last month, only 7,302 homes remained on the market — 35 percent fewer than last January.

Chris Sicks

Contact Chris Sicks by e-mail ([email protected]).

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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