The DC housing market has always had its ups and downs, but with government layoffs looming and economic uncertainty in the air, it’s hard to separate fact from fiction. For anyone wondering what’s next, you’ve come to the right place — we’re breaking down all the latest developments and insights for you right here.

The State of the Market: A Tale of Two Segments

Right now, the DC metro area is seeing two very different stories play out. On one hand, the luxury market — especially townhomes over $1 million — is still moving. Multiple offers are still coming in on desirable properties, and in Maryland and Virginia, inventory remains tight at just one month’s supply. The demand is there, and cash-heavy buyers aren’t hesitating to make moves.

On the other hand, the downtown condo market is struggling. Post-COVID recovery has been slow, and Trump-era policies, furloughs, and government layoffs are shrinking the buyer pool even further while slowing sales as a result. Since consumer confidence is wavering, many potential buyers are hitting pause, leading to increased inventory and longer days on market.

With four months of condo inventory sitting on the market and an absorption rate of just 17%, condos simply aren’t selling at the same pace as they once were. Of course, continued uncertainty in the stock market and in the political climate isn’t helping the condo cause. The outcome? Buyers may be showing up for tours, but they’re not pulling the trigger.

Planning on selling your home this year? Here are a few more posts you might find helpful:

• Do You Have to Renovate Your Home Before Selling It?
• Open House Vs. Private Showing: Which is Better For Selling Your House?
• 9 Small Details that Can Make or Break Your Home Sale

Who’s Pressing Pause?

First-time buyers, as well as those looking to upgrade to a larger condo, are hesitant to commit. The unpredictability of the economy and job security has them waiting on the sidelines, unsure which direction the market will swing next.

Luxury buyers, however, don’t seem to be phased. Those with strong cash positions are still buying, and in some cases, competing to win. For the high-end market, certainty simply hasn’t been shaken in the same way.

Will Return-to-Office Policies Make a Difference?

With some workers heading back to the office, could we see a shift in demand for downtown condos? Possibly. Proximity to work has always been a driving factor in DC real estate, but for now, the market is still in wait-and-see mode.

The Market Isn’t Crashing — But Confidence Is Key

Despite headlines predicting doom, the numbers tell a different story. Case in point? There are actually fewer homes on the market now than this time last year. The biggest issue comes back to confidence in how this is all going to play out — from the economic outlook to government layoffs and influential policies. Still, even as potential buyers are taking a pause, it doesn’t mean the market is collapsing — it just means people are exercising caution.

Are you thinking about buying a home this year? Read these posts next for more advice:

• Buying a Bigger Home in the Same Neighborhood: Pros and Cons
• What NOT to do if You Want to Buy a Home This Year
• Do I Need to Sign a Buyer-Broker Agreement?

The Bottom Line

While DC real estate is far from crashing, there’s no doubt that uncertainty is creating widespread confusion — not to mention hesitation. And while we don’t have a crystal ball, we’ll be with you as this all unfolds, providing you with the real-time analysis you need to make the right decisions for you.

Thinking of buying or selling sometime soon? Now’s the time to keep a close watch on the market — and make moves strategically with a trusted advisor by your side. Get in touch with our trusted team today to come up with a game plan tailored to your goals!

Have real estate questions? Get in touch with us directly by calling 202.280.2060 or email us at jsmira@jennsmira.com.