ROCKVILLE, Md., June 24, 2015 (GLOBE NEWSWIRE) -- Contrary to popular real estate wisdom, mortgage interest rates rising over 4 percent on a thirty-year fixed loan for the first time this year have had no discernable impact on home sales in the greater Washington DC market, according to the latest insights from big data company RealEstate Business Intelligence (RBI). RBI provides local market statistics and tools to over 30,000 real estate professionals in the Mid-Atlantic and other regions.
Interest rates for both conventional and “jumbo” mortgages began to discernably rise in May, but sales in the Washington DC Metro housing market enjoyed a strong month with charting at the highest monthly level since June 2014, while median days-on-market remain exceptionally low.
The strong market recorded the highest number of pending sales in May in more than a decade. Fueled by solid buyer demand, the number of new contracts increased 8.4% from May of 2014 to a total of 6,158 representing approximately $2.6 billion in sales. Illustrative of the overall market’s strength, new contracts have now risen year-over-year for seven consecutive months, and for the last four months all market segments demonstrated year-over-year increases.
There was a slight decrease in new contracts of 0.7% or 45 units compared to last month, which had been the highest level since July 2005. May contracts exceeded both the 5-year average of 5,778 and the 10-year average of 5,136. Townhomes showed the largest year-over-year increase at 10.2% or 145 units, followed by single-family detached with a 10% increase or 278 units, and condos with a 3.4% increase or 51 units.
“Consistent with the top-line national and regional statistics, we’re seeing robust growth this year ideal for both sellers and buyers in many local subdivisions and neighborhoods, and May turned in the best results in nearly a year, a clear sign that buyers are unfazed by rates in the vicinity of 4 percent.
As a leading indicator, pending sales provide an excellent data point that the market’s fundamentals are sound and little affected by rises in rates,” said John L. Heithaus, of RBI. “It’s important to keep any discussion of rising rates in perspective, at least for the foreseeable future.”
About RealEstate Business Intelligence, LLC
RealEstate Business Intelligence, LLC (RBI) is a primary source of real estate data, analytics and business intelligence for real estate professionals in the Mid-Atlantic Region. Visit us at rbintel.com and getsmartcharts.com for more.