- The Washington Times - Friday, January 16, 2009

The 2008 real estate market ended with a small dose of sunshine. Sales of existing homes were up 40 percent in December, compared to December 2007. There were 5,247 home sales recorded last month, compared to a woeful 3,744 a year earlier.

The last-month surge in sales brought the year’s total sales to about 78,500, which is 5 percent higher than 2007’s total. It’s the first yearly increase in sales we’ve seen since 2004.

Still, most of us are glad to put the 2008 market behind us. It began badly, with first-quarter sales down by 23 percent. Homes were selling very slowly all year, with most spending three to four months on the market. That delay was hard to get used to because, just a few years ago, most homes sold in one to three weeks.

Sales did manage to pick up toward the end of the 2008, but it was a rather Pyrrhic victory. Attracting those buyers required deep cuts in home prices. In addition, because prices fell the hardest in Virginia, that’s where the sales increased.

Still, home prices eventually fell enough in Maryland to attract buyers. Sales in Montgomery and Prince George’s counties were up significantly in December. After lagging behind Virginia all year, Montgomery and Prince George’s finally seem to be experiencing some of Virginia’s reverse in fortune.

That reversal began in Prince William County early in 2008. Twice last year, sales in Prince William actually exceeded those in Fairfax. This is stunning because Fairfax has three times as many houses as Prince William.

While December’s data is interesting to look at, everyone’s mind is now turning to 2009. The late-year surge in sales is encouraging, but we are still burdened with a big surplus of unsold homes. Also, despite the rise in sales in Prince William last year, prices continued to fall month after month.

Could they fall further this year? Will other counties see sales rebound if their prices fall further? Or have prices finally bottomed out?

I’m as anxious to know as you are.

• 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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