DC real estate MARKET

The Isaacs Team | Compass

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A comprehensive review of the factors affecting home values in Washington DC. The definitive source when understanding your local market matters.

Quick Predict | DC Market


Interest rate reduction delays have dampened market enthusiasm for sellers and buyers in early spring 2024.

When rate cuts finally begin this year–if they begin–the frequency and values may be insufficient to make a meaningful impact.

Low inventory levels combined with high rates continue to plague buyers and sideline sellers, putting upward pressure on Washington DC home prices.

While late 2023 predictions from econ experts had the Fed cutting rates  in March, it now looks like even a June cut is in question.

The March 10th consumer price index (CPI) report dropped jaws with a (much) worse than projected increase in U.S. inflation.

CPI YoY rose 3.5% when +3.4% was expected. Core inflation — the closely watched metric that excludes food and energy prices — increased 3.8% over the year ending in March vs the anticipated 3.7% and +0.4% on a monthly basis as opposed to the projected +0.3%.

The current US Inflation Rate is at 3.48%, up from February’s 3.15% and 3.09% in January, moving further and further away from the Federal Reserve’s 2% target.

A surprisingly resilient economy, rising commodity prices, and strong labor market combine with long-term inflationary contributors such as fiscal, military and green economy transition spending and rising healthcare costs to reduce the possibility of inflation hitting the Fed’s 2% target in 2024.

Uncertainty about July rate cuts is spreading, as experts downgrade the possibility of June cuts.

Quoted in “The Street,” Fed Chair Powell said; “The decision to begin to reduce rates is a very, very important one,” Fed Chairman Jerome Powell told an economic event in San Francisco late last month. “The economy is strong right now, and the labor market is strong right now. And inflation has been coming down. We can and we will be careful about this decision because we can be.”

Q2 2024

  • Mortgage interest rates remain high, posing a deterrent to buyers and sellers
  • Majority of homeowners locked into low rates continues to impact inventory
  • Low inventory continues to put upward pressure on prices
  • Some buyers taking advantage of market flexibility 
  • Cooperative commission rule changes loom

Economists forecast stubborn inflation for the remainder of 2024, but the Fed now indicates that reaching the target is not mandatory for easing of the benchmark rate, however ‘caution’ is their mantra.

With nearly 90% of U.S. homeowners locked into mortgage rates under 6%, rates must fall significantly to tempt sellers who can afford to wait.

Buyers currently active in the DC market are taking advantage of softer pricing, friendlier terms and, potentially, longer escrow periods.


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Essential Data

Key Data

Past 30 days | Washington DC

  • Mar. 2024 Sold Dollar Volume was $445,394,894, a drop of -10.59% from Mar. 2023;
  • Mar. 2024 Median Sold Price was $640,000, down -0.08% from this time last year
  • Mar. Avg Days on Market (DOM) was 40 Days, down -4.76% from Mar. 2023
  • Avg SP to Orig. List Price Ratio in March was 97.7%, up from February, and up 0.36% from March 2023.

*Data released monthly on the 10th-12th

Attached TH Median Sold Price

$879,000. +25.7% from Feb.

Detached Median Sold Price

$850,000. +-0 No change from Feb.

Attached Condo | Co-Op

$465,000. -6.1% from Feb.

DC Home Type Data

DC real esstate market data



A higher Contract Ratio signifies a relative increase in contract activity compared to supply, and indicates the market is moving in the seller’s favor.


A lower Contract Ratio signifies a relative decrease in contract activity compared to supply, and indicates the market is moving in the buyer’s favor.


  • March Median Sold Price for Washington DC Condo & Coop properties was $465,000, down 6.1% from February, and up 2.2% from Mar 2023.
  • Average Days On Market for units sold in March was 49 days, down from February’s 54 days, and 23% above the 5-year March average of 40 days.
  • There was an 18.9% month-over-month increase in new contract activity with 308 New Pendings; a 13.3% MoM increase in All Pendings (new contracts + contracts carried over from February) to 383; and an 8.6% increase in supply to 1,112 active units.
  • This activity resulted in a Contract Ratio of 0.34 pendings per active listing, up from 0.33 in February and a decrease from 0.44 in March 2023. The Contract Ratio is 41% lower than the 5-year March average of 0.58.


  • Washington DC Median Sold Price for Attached/ Townhouse properties for March was $879,000, up 25.7% from February, also up 8.5% from Mar 2023.
  • Average Days On Market for Attached homes sold in March was 32 days, 14% above the 5-year March average of 28 days.
  • There was a 19.7% month-over-month increase in new contract activity with 237 New Pendings; a 12% MoM increase in All Pendings (new contracts + contracts carried over from February) to 317; and a 10.4% increase in supply to 626 active units.
  • This activity resulted in a Contract Ratio of 0.51 pendings per active listing, up from 0.50 in February and a decrease from 0.62 in March 2023. The Contract Ratio is 49% lower than the 5-year March average of 1.00


  • Median Sold Price for Detached DC homes for March was $850,000, no change compared to February, and a decrease of 13.3% from March 2023.
  • Average Days On Market in March was 36 days, 9% above the 5-year March average of 33 days.
  • There was a 33.7% month-over-month increase in new contract activity with 111 New Pendings; a 20.9% MoM increase in All Pendings (new contracts + contracts carried over from February) to 139; and a 10.5% increase in supply to 253 active units.
  • This activity resulted in a Contract Ratio of 0.55 pendings per active listing, up from 0.50 in February and a decrease from 0.63 in March 2023. The Contract Ratio is 36% lower than the 5-year March average of 0.86.

Off-Market Inventory And Sales

A significant portion of homes bought and sold in the District of Columbia are transacted off-market. This ‘shadow’ inventory is not available to third party sites and is unlikely to be included, or reported with accuracy, by any market data tool. For this reason, Washington DC market data should be viewed as informational, rather than absolute. Assessments of inventory may be quite skewed based on the now commonplace use of ‘Private Exclusive’ listings held by individual brokerages.

What’s Ahead In 2024?

The Experts Predict

Here’s what the experts are saying about the 2024 national real estate market:

Chen Zhao | Redfin

“We are not expecting sales to increase dramatically, as rates are likely to remain above 6%.”

Selma Hepp | Core Logic

“Declines in mortgage rates will drive more sellers to trade their existing home and help add much-needed inventory to the market, leading to more transactions.”

Sam Khater | Freddie Mac

“Despite persistent inventory challenges, we anticipate a busier spring home-buying season than 2023.” Khater also noted that home prices would likely continue to increase “at a steady pace.”

The Existing Mortgage Factor

A rates-related factor affecting 2024 housing market activity is the impact of existing mortgages carrying low rates.

According to data analysts, nearly 90% of homeowners have mortgage rates under 6%, and 2/3rds carry rates below 4%. Understandably, many of those homeowners are reluctant to list their homes and re-enter the market at substantially higher rates. With such a massive portion of the market suppressed, upward pressure is exerted on available home prices, creating an additional deterrent for  buyers and sellers alike.

Not everyone finances a home purchase, however, and not all are able to postpone selling and buying plans.

Buying Opportunities

In Washington DC, consider these key takeaways:

+ Timing Matters: With an increased average DOM, seasonally lower prices and some nwe inventory of note, buyers may find excellent opportunities during the first two quarters of 2024;
+ Diverse Financing Options: Explore short-term (12-24 month) ‘alternative’ financing options such as adjustable rate loans considering both the Fed’s stated intention to lower rates several times in 2024, and new jumbo loan terms. These can make an advantageous Q1 purchase possible;
+ Segment-Specific Choices: The range variations in this year’s sales prices related to specific property types highlight the importance of tailoring approach based on market segment, for both buyers and sellers.

Navigating the DC real estate market requires a nuanced understanding of the data and a strategic approach to capitalize on emerging opportunities. As we move forward, staying informed and acting quickly on opportunities will be key to making the most of what the market has to offer. Let us help you step into the 2024 market confidently and profitably.

Looking Ahead


DC Metro Area

The DC Metro Area includes Washington DC and parts of Maryland, Virginia, and West Virginia. It’s important to clarify the areas of the region being used by data reports before relying upon their numbers. Real estate is local first, so while we look at data for various regions surrounding the District of Columbia, our primary focus is on the District itself, parts of northern Virginia, and particular Maryland counties. We find this to be the most accurate representation of the market we live and work in.

Below are the four primary measures of the DCMA regional housing market for all home types:


Forbes Advisor Highlights

March 2024

“As the spring home-buying season approaches, there are signs that buying and selling activity in the market may not fully bloom.

A combination of still-high mortgage rates and home prices amid historically low housing stock continues to put homeownership out of reach for many—most notably first-time buyers.”

Additionally, NAR (National Association of Realtors) agreed to a $418M settlement mid-March following a verdict favoring plaintiffs in a class action lawsuit. Still subject to court approval, the settlement requires changes to real estate market commission practices in place for decades. Read about it on our blog. Those changes are expected to commence mid-July, and are almost certain to confuse both buyers and sellers.

Essentially, all of the 2023 headwinds remain; elevated mortgage rates, out-of-reach home prices and record-low housing stock.

“The housing market is likely to continue to face the dual affordability constraints of high home prices and elevated interest rates in 2024,” said Doug Duncan, senior vice president and chief economist at Fannie Mae, in an emailed statement. “Hotter-than-expected inflation data and strong payroll numbers are likely to apply more upward pressure to mortgage rates this year than we’d previously forecast.”

Despite ongoing affordability hurdles, Fannie Mae forecasts an increase in home sales transactions compared to last year. Experts also anticipate a slower rise in home prices this year compared to recent years, but price fluctuations will continue to vary regionally and depend strongly on local market supply.

U.S. home prices declined in January for the third consecutive month due to high borrowing costs, according to the latest S&P CoreLogic Case-Shiller Home Price Index. But prices year-over-year jumped 6%—the fastest annual rate since 2022.

Chief economist at First American Financial Corporation Mark Fleming predicts a “flat stretch” ahead.

Will the housing market finally recover in 2024? Read projections on Forbes.

Gradual Thaw, Added Challenges

February 2024

U.S. News offers an insightful take on the 2024-2028 real estate market:

“Over the next five years, although some trends accelerated by the COVID-19 pandemic will continue to influence real estate and land use, other factors will also gain in importance.

Among those are an aging population, the rising costs of climate change, a more unstable world and the expansion of artificial intelligence into new corners of the economy.

As a consequence, even if the housing market gradually unfreezes as mortgage rates slowly decline from 2023’s highs, the hottest housing markets in 2028 may look a bit different from early 2024.”

The prediction is based on ‘several authoritative sources,’ including the publication’s own U.S. News Housing Market Index.

Key Findings


  • Following a 28-year low in [early] 2023, existing home sales will gradually rebound as mortgage rates decline
  • True price discovery will occur as lending rates fall and more homes are listed for sale
  • New construction home sales will hold their elevated market share due to builders’ ability to buy down mortgage rates + pent-up demand
  • Rents will stabilize due to added supply, more closely tracking inflation rates

Fed Inflation NowCast

March 2024

Month CPI Core CPI PCE Core PCE Updated
April 2024 0.34 0.31 0.25 0.23 04/10
March 2024 0.32 0.30 04/10
Note: If the cell is blank, it implies that the actual data corresponding to the month for that inflation measure have already been released.
Month CPI Core CPI PCE Core PCE Updated
April 2024 3.43 3.65 2.60 2.66 04/10
March 2024 2.65 2.74 04/10
Quarter CPI Core CPI PCE Core PCE Updated
2024:Q1 3.18 3.48 04/10
2024:Q2 3.76 3.93 2.97 2.95 04/10

“Nowcasts” are estimates or forecasts of inflation for two popular price indexes, the price index for personal consumption expenditures (PCE) and the Consumer Price Index (CPI).

The Fed | Benchmark Rate

Reuters Reports On CPI And Rates

April 10  Reuters – Prospects for a first Federal Reserve interest-rate cut before the end of summer — or even at all this year — took a body blow on April 10th with another U.S. inflation report that cast into stark relief the stickiness of price pressures across the U.S. economy.
After months of centering on June for the start of Fed policy easing, traders’ bets are now squarely on the Fed’s mid-September meeting for an initial rate reduction, after a third straight stronger-than-expected reading on consumer inflation sent financial markets into a fast retreat.

Insiders Takes On Rate Cuts

March 6, 2024


Cameron Dawson, CIO Newedge Wealth, NY

“The numbers came in hot which is causing equity futures to drop quite sharply and bond futures for yields to shoot higher effectively pricing out the pivot of the Fed.”
“The key point here is that the Fed has looked through January and February data being hot, saying that it was just a blip or a bump in the road in the past to continue this inflation. However, now that you have a third month, it makes it much harder for the Fed to ignore.”

Mortgage Rates Forecast

Pundits have been wrong all year, so take it with a grain of sale.


Fannie Mae 6.6% 6.2%
Mortgage Bankers Association 6.1%* 5.6%
National Association of Home Builders 6.61% 6.01%
National Association of Realtors 6.5% 6.1% 6.8% (6.5%*)
Wells Fargo 6.53% 5.85%

*Denotes year-end rate. All others are annual averages.


Mortgage Rate Predictions April 2024

Fannie Mae: Rates Will Decline to 6.4%

The March Housing Forecast from Fannie Mae puts the average 30-year fixed rate at 6.7% during the first quarter of 2024, falling to 6.4% by year-end. This reflects an upward revision in Fannie’s analysis: Just last month, the mortgage giant expected rates would dip below 6% at the end of this year. All told, Fannie Mae predicts mortgage rates will average 6.6% in 2024 and 6.2% in 2025.

“Hotter-than-expected inflation data and strong payroll numbers are likely to apply more upward pressure to mortgage rates this year than we’d previously forecast, as markets continue to evolve their expectations of future monetary policy,” says Doug Duncan, Fannie Mae’s senior vice president and chief economist, in a March 19 statement.

MBA: Rates Will Decline to 6.1%

In its March Mortgage Finance Forecast, the Mortgage Bankers Association predicts that mortgage rates will fall from 6.8% in the first quarter of 2024 to 6.1% by the fourth quarter. The industry group expects rates will fall below the 6% threshold in the first quarter of 2025.

“The strength in the job market, along with an economy that is still growing at a moderate pace, are positives for the housing market, as it supports home purchase activity and helps borrowers to stay current on their mortgage payments,” MBA economists say in a March 2024 outlook. “However, the labor market’s continued resiliency is one of several factors keeping mortgage rates from declining much further in the near term, as it increases the likelihood that the Fed will not rush to cut rates.”

Economic Forecasts

The Conference Board

Forecast for U.S. Economy | Mar. 21, 2024

The US economy entered 2024 on strong footing. Various indicators of business activity, labor markets, sentiment, and inflation have generally been moving in a favorable direction. However, headwinds including rising consumer debt and elevated interest rates will weigh on economic growth. While we no longer forecast a recession in 2024, we do expect consumer spending growth to cool and for overall GDP growth to slow to under 1% over Q2 and Q3 2024. Thereafter, inflation and interest rates should normalize and quarterly annualized GDP growth should converge toward its potential of near 2 percent in 2025.

US consumer spending held up remarkably well in 2023 despite elevated inflation and higher interest rates. However, this trend is already beginning to soften in early 2024. For instance, retails sales growth over the first two months of the year were weak. Gains in real disposable personal income growth are softening, pandemic savings are dwindling, and household debt is increasing. Consumers are spending more of their income on service debt and delinquencies are rising. Additionally, the growth in ‘buy now, pay later’ plans may also weigh on future spending as bills come due. Thus, we forecast that overall consumer spending growth will gradually slow to a standstill in Q3 2024 as households struggle to find a new equilibrium between income, debt, savings, and spending. While we anticipate labor market conditions to soften over this period, we do not expect them to deteriorate. As inflation and interest rates abate, consumption should expand once again in late 2024.

Following a pop in early 2023, business investment growth slowed in H2 2023 as interest rate increases made financing activities more expensive. This trend should intensify in H1 2024 as the Fed resists calls to cut interest rates likely until June 2024. Residential investment, which had been contracting since 2021, began to grow again in Q3 2023. Persistent demand for homes and a dearth of supply was the driver. However, looking ahead, we do not expect residential investment growth to sustainably improve until interest rates begin to fall.

Government spending was a positive contributor to growth in 2023 due to federal non-defense spending associated with infrastructure investment legislation passed in 2021 and 2022. However, growth is likely to slow in 2024 and 2025 as infrastructure spend out stabilizes. Furthermore, political volatility surrounding fiscal policy, debt, and outlays could impact government spending over the next few years.

Labor market tightness has been remarkably persistent over the last year. As this should continue over the coming quarters, we do not expect labor markets to unravel even as the economy slows. The tightness largely reflects a shrinking labor force as Baby Boomers retire. As such, businesses are likely to be resistant to lay off workers.

On inflation, we expect to see continued progress over the coming quarters, but there will be bumps. Supply chains are continuing to heal and price pressures emanating from dwellings and services continue to slowly moderate. Notably, services demand should cool as consumer spending wanes. We expect headline PCE inflation to hit the Fed’s 2 percent target in Q3 2024. This expectation will trigger rate cuts starting in June 2024. We anticipate four 25 bp cuts this year (100bps in total) and an additional four 25 bp cuts in 2025 (100dps in total).

The Conference Board

Global Forecast | March 21, 2024

Global growth forecast for 2024 continues to move higher as US and China outlooks improve

The Conference Board raised its global real GDP forecasts for 2024 and 2025 again in March. We now project global growth of 3% for this year, up from 2.8% in our February forecast, and 3.1% in 2025, up from 2.9% last month. The growth dip we previously forecasted for this year has disappeared, and we now expect a more stable global GDP growth trend slightly above 3% for the next two years.

Growth among Mature Economies is expected to remain well below the pre-pandemic average of 2.1%. We forecast real GDP growth of 1.4% in 2024, not much changed from last year’s 1.5%, and a very modest pick-up to 1.6% for 2025.

We continued to upgrade our 2024 US growth forecast, still expecting a mid-year slowdown, but moving further away from the recession call we had for most of last year. The improvement in the US outlook stems from persistent labor market strength that continues to deliver employment gains and positive real income growth. Labor shortages prompted many firms to retain workers over the last year, despite concerns about recession. However, elevated interest rates have driven up the cost of servicing credit card and consumer loan debt, and delinquencies are rising. Our forecast assumes the Federal Reserve will start cutting interest rates in June. The growth restraining forces of keeping rates higher-for-longer are becoming more visible and we expect inflation to hit the bank’s 2% target over the summer. That should trigger a sustained series of rate cuts to bring monetary policy rates closer to a more neutral level in 2025.

The Fed | Beige Book

March 2024

Overall Economic Activity

Economic activity increased slightly, on balance, since early January, with eight Districts reporting slight to modest growth in activity, three others reporting no change, and one District noting a slight softening.

  • Consumer spending, particularly on retail goods, inched down in recent weeks. Several reports cited heightened price sensitivity by consumers and noted that households continued to trade down and to shift spending away from discretionary goods.
  • Activity in the leisure and hospitality sector varied by District and segment; while air travel was robust overall, demand for restaurants, hotels, and other establishments softened due to elevated prices, as well as to unusual weather conditions in certain regions.
  • Manufacturing activity was largely unchanged, and supply bottlenecks normalized further. Nevertheless, delivery delays for electrical components continued. Ongoing shipping disruptions in the Red Sea and Panama Canal did not generally have a notable impact on businesses during the reporting period, although some contacts reported rising pressures on international shipping costs.
  • Several reports highlighted a pickup in demand for residential real estate in recent weeks, largely owing to some moderation in mortgage rates, but noted that limited inventories hindered actual home sales.
  • Commercial real estate activity was weak, particularly for office space, although there were reports of robust demand for new data centers, industrial and manufacturing spaces, and large infrastructure projects. Loan demand was stable to down, and credit quality was generally healthy despite a few reports of rising delinquencies.
  • The outlook for future economic growth remained generally positive, with contacts noting expectations for stronger demand and less restrictive financial conditions over the next 6 to 12 months.

Labor Markets
Employment rose at a slight to modest pace in most Districts. Overall, labor market tightness eased further, with nearly all Districts highlighting some improvement in labor availability and employee retention. Businesses generally found it easier to fill open positions and to find qualified applicants, although difficulties persisted attracting workers for highly skilled positions, including health-care professionals, engineers, and skilled trades specialists such as welders and mechanics. Wages grew further across Districts, although several reports indicated a slower pace of increase. Employee expectations of pay adjustments were reportedly more in line with historical averages.

Price pressures persisted during the reporting period, but several Districts reported some degree of moderation in inflation. Contacts highlighted increases in freight costs and several insurance categories, including employer-sponsored health insurance. Nevertheless, businesses found it harder to pass through higher costs to their customers, who became increasingly sensitive to price changes. The cost of many manufacturing and construction inputs, such as steel, cement, paper, and fuel, reportedly fell in recent weeks.

The Conference Board

StraightTalk | Chief Economist Dana M. Peterson

The Inflation Battle Rages On
March 17, 2023

Central banks are engaged in a rough and tumble war against elevated inflation. Emerging markets entered the battle first with tighter monetary policy, and advanced/mature economies soon followed. While global inflation gauges appear to have peaked, they remain sticky, and it is not clear when key measures of consumer price inflation will fall back to their respective targets. Hence, central banks continue to tighten.

While central banks may ultimately achieve their goal of vanquishing inflation, to do so may mean keeping interest rates higher than recent decades’ norms. There is also the risk that policymakers will struggle to maintain those targets unless corporations and governments work together to lean against current and future structural drivers of inflation.


Main Factors Affecting Housing Markets

  • Economic growth
  • Housing demand
  • Unemployment
  • Interest rates
  • Consumer confidence
  • Mortgage availability and supply
How the economy impacts housing

Housing Starts

Tracking housing starts by new residential construction permits is a key in determining the health of a local real estate market. When the economy is strong, more new homes are built and sold. In weak economies, fewer permit applications are made and fewer new homes are sold. Housing starts are essential indicators of economic health, and affect related markets such as mortgages, land sales, raw materials and employment.

Home Sales And the Economy

There is a direct correlation between home sales and economic health. As economies slow, money supply becomes harder to borrow, and as a result, fewer home buyers enter the housing market. This leads to diminished home inventory and homes on the market take longer to sell. A greater supply of homes in a market with lower demand generally forces prices downward.

Money Supply

Money supply is critical to housing market health. When borrowing is too difficult, housing starts and home sales slow significantly. When borrowing is too easy, too many buyers enter the housing market and drive up prices until a market correction or crash occurs.

Foreclosures Reflect a Market Downturn

Foreclosures are an indicator and a result of a housing market decline or crash. If interest rates rise dramatically, borrowers with adjustable rate mortgages may not be able to refinance or stay current on the debt. This results in increased foreclosure activity. Mortgage type isn’t the only reason for heightened foreclosure volume. The leading causes of foreclosure are rising unemployment, debt (medical debt in particular), divorce, death of a spouse or partner who contributed income, and  unexpected large expenses.

Economic Slowdowns, Recessions

When the economy slows, or falls into a recession, it will affect the housing market, which, in turn, further impacts the economy as housing-related activities decline. This economic cycle breaks once economic improvement begins and housing prices reflect consumers’ confidence in their ability to take on mortgage debt.

DC Is An Unusual Market

The District is a unique and sought-after housing market– among the strongest in the country. Bouyed by the constant ebb and flow of government officials and contractors, Amazon’s HQ2, the tech sector, scarcity of land and the District’s small size (68.3 SqM), and its connectivity to adjoining states, Washington DC has weathered many declining markets well, and recovered quickly.

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