A Terrific Week in Virginia and Montgomery County

Key Takeaways

• With seven and a half months of 2025 in the books, the affordability challenges facing first-time homebuyers are real.
• Those areas with the highest proportion of homes priced over $750,000 are faring well, while those that are heavier on inventory of lower-priced homes that are more attractive to first-time buyers are having a rougher time.
• Year-to-date, contract activity for homes priced over $750,000 in Loudoun County constitutes an astounding 52% of all sales, and Northern Virginia isn’t far behind at 50%.  And those two jurisdictions have seen a YTD increase in overall contracts of 4.9% and 1.8% respectively.
• On the other hand, homes priced over $750,000 represent just 5% of all contracts so far this year in Prince George’s County. PG is largely a first-time home-buyer’s market, and their total contract activity is down 11.8%. It’s a particularly challenging time for entry-level buyers.

Why It Matters

• Last week saw mortgage interest rates drop to their lowest level so far this year – 6.58%.  That’s certainly encouraging, and all eyes are on the Fed, hoping for a cut in the Federal Funds Rate for the first time in almost a year.
• While that doesn’t have a direct correlation to mortgage rates, actions  - or lack of actions - by the Fed obviously have enormous real and psychological impact on the market
• And once again, homes are taking longer to sell than a year ago.  This same week last year saw homes going under contract in an average of 32 days . . . and that climbed to 43 days now.