DC REAL ESTATE MARKET UPDATE

District of Columbia Weekly Market Data

BRIGHT MLS DATASET	WEEK ENDING 9/27/26	PRIOR YEAR	PRIOR WEEK
WEEKLY SHOWINGS	1,965	-20.8%	-13.8%
NEW SALES CONTRACTS	147	-5.8%	-5.2%
MEDIAN DAYS TO CONTRACT	35	-4 days	-8 days
NEW LISTINGS	289	+7.4%	-16.5%
MEDIAN LIST PRICE	$649,000	+3.8%	-5.2%
ACTIVE LISTINGS	2,953	-0.4%	+1.9%
% ACTIVE WITH PRICE DROP	7.1%	-0.4 pp	-0.1 pp
CANCELLED LISTINGS	38	+15.2%	+5.6%

Summary

Buyer activity weakened in DC during the week ending September 27. Weekly showings fell 13.8% from the previous week to 1,965 and were 20.8% below the same week last year. New sales contracts declined more modestly, falling 5.2% for the week to 147 and 5.8% year over year. Homes that did secure contracts moved more quickly, however, with the median time to contract falling eight days from the previous week to 35 days.

New listings declined 16.5% from the prior week to 289 but remained 7.4% above the same week last year. Active inventory continued to edge higher, increasing 1.9% for the week to 2,953, although inventory was essentially unchanged from a year ago. The share of active listings with a price reduction slipped to 7.1%, down 0.1 percentage point for the week and 0.4 percentage point from last year.

The decline in buyer traffic comes as borrowing costs have moved sharply higher. Mortgage rates had already climbed above 7% ahead of the Federal Reserve’s September 15-16 meeting, when the Fed raised its benchmark rate by 25 basis points. Mortgage rates don’t move directly with the federal funds rate, and the increase itself was largely anticipated by financial markets. Bond yields and mortgage rates reacted more significantly to signals from Fed Chair Kevin Warsh that additional tightening could follow. With mortgage rates remaining elevated after the meeting, higher borrowing costs likely contributed to the pullback in showing activity, although data can’t establish motive.

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Washington DC Metro Area Weekly Data

The DC Metro Area market consists of District of Columbia, Arlington Va, Alexandria Va, Alexandria City Va, Fairfax County, Fairfax City, Falls Church, Montgomery County Md, Loudoun County Md, and Frederick County Md.

BRIGHT MLS DATASET	WEEK ENDING 9/27/26	PRIOR YEAR	PRIOR WEEK
WEEKLY SHOWINGS	14,485	-17.6%	-5.5%
NEW SALES CONTRACTS	947	-19.5%	-9.1%
MEDIAN DAYS TO CONTRACT	34	+5 days	+4 days
NEW LISTINGS	1,434	+4.1%	-14.0%
MEDIAN LIST PRICE	$614,950	-3.2%	-3.9%
ACTIVE LISTINGS	12,539	+20.3%	+1.9%
% ACTIVE WITH PRICE DROP	10.3%	+0.0 pp	+0.2 pp
CANCELLED LISTINGS	173	+41.8%	-10.8%

Summary

Buyer activity also weakened across the Greater DC housing market during the week ending September 27. Showings declined 5.5% from the previous week to 14,485 and were 17.6% below the same week last year. New purchase contracts fell 9.1% for the week to 947, putting contract activity 19.5% below last year’s level. The median time to contract increased four days from the previous week to 34 days.

New listings slowed as well, falling 14% from the previous week to 1,434, although they remained 4.1% above last year. Active inventory continued moving in the opposite direction, rising another 1.9% to 12,539 and reaching 20.3% above the same week last year. The share of active listings with a price reduction increased slightly to 10.3%, while cancellations fell 10.8% for the week but remained 41.8% above last year’s level.

The regional decline in buyer activity occurred against the same backdrop of rising borrowing costs. Mortgage rates had already moved above 7% before the Federal Reserve raised its benchmark rate by 25 basis points at its September 15-16 meeting. While mortgage rates don’t move in tandem with the federal funds rate, bond markets subsequently reacted to the prospect of additional Fed tightening in 2026, and mortgage rates inched up. Higher borrowing costs likely contributed to weaker buyer traffic during the period, adding pressure to a regional market where active inventory is now 20.3% above last year while new purchase contracts are 19.5% lower.

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DC (City) Monthly Data

AUG 2026

Sept. 2026 data will be released Oct. 11, 2026

METRIC	AUG 2026	YOY	MOM
TOTAL SOLD DOLLAR VOL	$464,963,547	-2.4%	-19.1%
AVG SOLD PRICE	$1,050,690	+22.9%	+12.7%
MEDIAN SOLD PRICE	$681,500	+1.7%	+1.3%
UNITS SOLD	438	-19.5%	-28.0%
AVG DAYS ON MARKET	51	+15.9%	+13.3%
AVG SP TO OLP	95.7%	+0.5 pp	-0.2 pp
ACTIVE LISTINGS	2,514	-4.3%	-4.4%
NEW LISTINGS	571	-15.9%	-21.9%
NEW PENDINGS	373	-14.6%	-28.1%
ALL PENDINGS	557	-7.3%	-16.2%

Source: SmartCharts Pro

Summary

August 2026 DC (City) Summary

Washington’s housing market slowed considerably in August, as is seasonally expected. Closed sales fell to 438, down 19.5% from August 2025 and 28% from July. New pending sales also weakened, falling 14.6% year over year to 373, while new listings declined 15.9%. With both buyers and sellers pulling back, active inventory actually finished the month 4.3% below its year-ago level.

Prices held up considerably better than transaction activity. The median sold price rose 1.7% from a year ago to $681,500, while the average sold price jumped 22.9% to more than $1.05 million. That unusually large increase in the average was heavily influenced by the mix of properties sold: detached homes averaged $2.27 million, up 49.4% from August 2025, despite only 72 detached sales.

The August numbers point to a market with fewer participants on both sides rather than a broad decline in prices. Homes that sold took longer, averaging 51 days on market compared with 44 last August, but sellers still received an average 95.7% of their original asking price.

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DC Metro Area Monthly Data

AUG 2026

Sept. 2026 data will be released Oct. 12, 2026

METRIC	AUG 2026	YOY	MOM
TOTAL SOLD DOLLAR VOL	$3,975,361,184	-4.5%	-15.8%
AVG SOLD PRICE	$731,298	+2.3%	-1.4%
MEDIAN SOLD PRICE	$597,500	+1.7%	-0.4%
UNITS SOLD	5,404	-6.5%	-14.9%
AVG DAYS ON MARKET	31	+6.9%	+10.7%
AVG SP TO OLP	98.2%	+0.2 pp	-0.3 pp
ACTIVE LISTINGS	15,366	+12.9%	-1.0%
NEW LISTINGS	5,978	-3.8%	-15.9%
NEW PENDINGS	5,207	-10.4%	-10.6%
ALL PENDINGS	6,565	-5.4%	-9.1%

Sources: Smart Charts Pro

Summary

August 2026 DC Metro Summary

The Greater DC housing market also slowed in August, although the decline was considerably less pronounced than in the District. Closed sales fell 6.5% from August 2025 to 5,404, while new pending sales declined 10.4%. New listings were down a more modest 3.8% year over year.

Prices remained relatively stable. The median sold price rose 1.7% from a year earlier to $597,500, while the average sold price increased 2.3% to $731,298. Homes took somewhat longer to sell, averaging 31 days on market compared with 29 days last August, while sellers received an average 98.2% of their original asking price.

Unlike DC City, however, the broader region continues to carry substantially more inventory than it did a year ago. Active listings totaled 15,366, 12.9% above August 2025, even after slipping 1% from July. That combination of higher inventory and a 10.4% year-over-year decline in new pending sales suggests buyers across the region had more choices while demand softened heading toward the fall market.

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The Condominium Market: Washington DC’s Weakest Link

One of the biggest stories of the past two years has been the steady deterioration of the District’s condominium market. While other property types have held up better, condominiums and co-ops remain the weakest segment of Washington’s housing market and account for a disproportionate share of the city’s available inventory.

Condos are highly reactive to market and economic conditions and often show changes in buyer demand earlier than other housing types. The District’s condominium market was beginning to recover from the severe demand disruption of the pandemic when DC’s economic trajectory changed again in early 2025. Federal employment and spending uncertainty added another challenge to a market already contending with high mortgage rates and rising ownership costs. Since then, tighter condominium financing and insurance requirements have added further pressure to the buyer pipeline.

Washington DC’s condominium market continues to show a widening gap between prices and transaction activity. Through August, 1,812 condos and co-ops had sold in 2026, down 10.9% from 2,034 during the same period last year. New pending contracts were down a similar 10.2%. Yet the median sold price for the first eight months of the year was unchanged at $490,000.

The slowdown is more visible in the measures of market liquidity. August ended with 1,469 active condo and co-op listings, about 3.3% more than a year earlier. Homes that sold had spent an average of 67 days on the market, compared with 48 days in August 2025 and a five-year August average of 47 days. The contract ratio fell to 0.13 pending contracts per active listing, down from 0.18 a year earlier and roughly half the five-year August average of 0.25.

August itself was particularly weak for transactions: 187 condos and co-ops closed, 29.2% fewer than a year earlier, while new pending contracts fell 31.2% to 137. One month shouldn’t be treated as a trend by itself, but those readings are consistent with the longer January-through-August decline in sales and contract activity. The result is not a broad decline in the prices recorded by successful sales. It is a condo market completing fewer transactions, taking longer to produce those transactions, and carrying more available inventory relative to current contract activity.

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Declining Values

So why haven’t condo prices fallen further? Part of the answer is in the math. Many condo sellers simply don’t have as much room to cut their prices. Condominiums tend to have thinner equity margins than more expensive property types, particularly when the owners purchased recently or financed with relatively small down payments.

Unlike detached homeowners who often:

• Bought years ago
• Accumulated significant appreciation
• Paid down principal
• Have flexibility to negotiate;

many condo owners:

• Purchased more recently
• Put 3–10% down
• Paid peak-pandemic prices (this is the part where you care more about what you paid for your condo than what you pay per month)
• Financed mortgage insurance
• Paid premiums on new construction
• Experienced little or no appreciation and in many cases loss
• Continue paying rising HOA dues, insurance and utility costs.

Their margins are erased, or even negative.

When prices soften, it doesn’t matter a great deal to those with 40% equity, but it is a sale-killer for others. And as inventory levels continue to rise, prices continue to lower, widening the gap between what’s owed and current market value. Even modest price declines can make it difficult to sell without bringing cash to closing, leaving some owners effectively trapped in their homes.

Washington’s condominium market has historically depended on two primary buyer groups:

The first is first-time homebuyers. Condominiums have long served as the entry point into homeownership for young professionals beginning careers in government, law, consulting, lobbying, nonprofits, healthcare, and related industries. These buyers traditionally purchase a condominium as their first home before moving up to a rowhouse or detached property;
The second is part-time or pied-à-terre buyers. Members of Congress, federal executives, diplomats, attorneys, corporate executives and other professionals have historically purchased condominiums because they wanted a low-maintenance residence close to Capitol Hill, downtown, or federal agencies. They weren’t necessarily looking for the least expensive housing, they were buying convenience, security and a lock-and-leave lifestyle.
Both groups have backed off.

Certainly the first-time buyer pool shrank because affordability deteriorated, mortgage interest rates rose, and cratering federal employment caused many younger households to search elsewhere. But also, the city’s overall desirability has suffered over the past two years. Net migration in the District was −4.1k in 2025. Fewer of the city’s new residents are entering its for-sale housing market this year.

That’s a real problem for condominiums.

Condominiums are not just another housing type in Washington. They are the foundation of the District’s homeownership ladder. When fewer buyers enter through that first rung, fewer owners move up to larger homes, reducing liquidity throughout the entire housing market.

Unfortunately, the challenges facing condominium owners are poised to become even greater.

Beginning this summer, Fannie Mae and Freddie Mac are implementing sweeping underwriting changes that will make financing more difficult for many condominium and cooperative buildings. Higher reserve funding requirements, stricter reserve study standards, lower deductible thresholds, and the elimination of limited reviews for most projects will leave many underfunded or poorly managed associations unable to meet agency standards. Buyers may not discover that a building is non-warrantable until late in the financing process, causing transactions to fail just before closing.

At the same time, the DC Council is considering the Condominium Insurance Amendment Act of 2025 (B26-0495), legislation that would substantially increase the financial exposure of condominium owners by raising deductible pass-through limits, expanding insurance requirements, and requiring broad waivers of subrogation. Although presented as consumer protection, the proposal could shift significantly more financial risk from condominium associations onto individual owners, particularly in situations where the origin of property damage is disputed, a common occurrence in multifamily buildings.

Taken together, these trends suggest the District’s condominium market is no longer facing a temporary cyclical slowdown, it’s undergoing a structural shift. A smaller pipeline of first-time and part-time buyers, rising ownership costs, tighter financing standards and additional legislative uncertainty are all reducing the buyer pool. Until that buyer pipeline begins to expand again, condominiums are likely to remain the weakest segment of Washington’s housing market, and the first place where broader economic changes become visible.

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Mortgage Rates And Impact

Septamber 2026

The Federal Reserve raised its benchmark interest rate by 25 basis points to a range of 3.75%–4.00% following the FOMC meeting in September, indirectly pushing average 30-year fixed mortgage rates to around 6.76%, though most mortgage lenders had already priced in the move and those who were more aggressive may actually shave rates down in the coming week.

The unanimous 12-0 vote by the Federal Open Market Committee marked the first rate increase after five consecutive meetings on hold.

How the Fed Rate Affects Housing

Fixed mortgages track long-term bond yields such as the 10-year Treasury note. When the benchmark rate rises signaling a tighter economy, bond yields and mortgage often rise in response.

Since higher interest rates raise monthly mortgage payments, many buyers take a step back from the market, impacting home sales volume.

Homeowners are also affected because borrowing costs increase overall. Home Equity Lines of Credit (HELOCs) have variable rates, as do other adjustable rate mortgages. A Fed rate hike has an immediate effect on those products.

The home building industry is also impacted. Smaller builders rely on short-term loans to build houses and higher rates means costs rise and the final project increases in price to homebuyers. An unfriendly lending environment can also deter builders altogether, slowing down the creation of new housing supply.

Don’t expect drastic price drops as a result of higher mortgage rates. The norm is for prices to flatten, or rise slowly. Sellers often choose to remain in their homes or become landlords until conditions improve.

The Fed signaled that there would be at least one more rate hike this year and nearly half the board sees at least 2 more hikes in this cycle.