The Internet is Wrong, The DC Market is Not Crashing

Question: I have seen multiple posts online that the DC area market is getting flooded with inventory and is crashing, is that accurate?

Answer: I was planning to do a lovely post this week on 2025 design trends (maybe next week?), but social media exploded over the weekend with posts about the DC area market being flooded with homes for sale and crashing due to the DOGE/Trump government cuts. After about 20 different people texted me about it, I figured I’d use this week’s column to correct the misinformation hitting so many of your newsfeeds.

Short Answer: The DC area market is not currently showing signs of a crash or being flooded with unseasonally high numbers of homes for sale.

For a longer response, I’ll share and respond to a handful of the posts/stats that have gotten the most exposure on social media…

“Everything is being put on the market”

The post screenshotted below kicked off the frenzy (11M views in 36 hours) of People-on-the-Internet making false claims of a DC area market crash/inventory flood. One would think that somebody by the name of Darth Powell (64,000 followers) whose bio states they’re a “Housing market savant” would surely know what they’re talking about, right? Sadly, no.

What Darth Powell is suggesting is that the visual of so many listings in Coming Soon status suggests that everybody is suddenly putting their home up for sale. For context, the reason a seller would enter their home into the MLS in Coming Soon status is because they get the benefits of massive marketing exposure (reaches all agents in the MLS and syndicates to all consumer-facing sites like Zillow) without accruing “days on market” before they are ready to “go Active” and start showing the home and hosting Open Houses (note: the MLS restricts and enforces a ban on showings while in Coming Soon status).

Here are just a handful of reasons why the post is (very) inaccurate:

• Spring Market: We are two weeks away from the beginning of the spring market, which draws the largest volume of new listings, every year. More than 1/3 of homes listed for sale each year get listed in the 10-12 weeks between early March and late May. So, yeah, no kidding there are more homes in Coming Soon status right now as we head into the spring market. This happens every year.

• Coming Soon Rule Changes: In August 2024, Bright MLS (our regional MLS) changed the Coming Soon rules to allow homes to sit in Coming Soon status for any amount of time. Prior to that, it was limited to 21 days. As a result, some homes are in Coming Soon status for extended periods of time (e.g. homes under construction) and thus we have more total homes in Coming Soon at any point in time.

• Actual Data: Most importantly, however, is the fact that the number of homes in Coming Soon in Arlington and the surrounding areas shown in the map is simply not that that high (inventory levels are at decades-long lows). We live in a densely populated area which means the visual effect of Coming Soon icons coneys a different message than the actual data.

As of Sunday Feb 16 (less than 48 hours after the post), there were 42 properties in Coming Soon status in Arlington. There were nearly 2,200 homes sold in Arlington in 2024 (one of the lowest totals in decades). That means the Coming Soon listings are less than 2% of the total number of homes sold last year; that is not a flood of inventory, in fact, we need more inventory coming to market.

I also replicated the area shown on the map in this post, which includes all of Arlington, large parts of Falls Church and Mclean, and some of Alexandria and Washington DC. There are a total of 72 homes in Coming Soon status and 61 homes listed for sale in the past two weeks. Last year, this same geographic area had 3,434 sales (again, one of the lowest totals in decades due to hyper-low inventory levels), so between Coming Soon homes and homes listed for sale since Feb 1, we’ve got 133 homes (3.9% of last year’s total sales) as we head into the spring market. There is no inventory surge.

Conclusion: there is ZERO data to suggest that “everything is being put on the market.” In fact, we are starved for inventory (outside of a few small sub-markets) and could use more of it.

“Since DOGE Began…median home price in Washington DC has Fallen by $139,000”

This post was made by The Kobeissi Letter account on X (over 8M views in 24 hours), an account with 737,000+ followers claiming to be “an industry leading commentary on the global capital markets” yet somehow doesn’t understand basic statistics or how to do simple research. If you follow them for financial/investment guidance, reconsider.

Yes, the median year-over-year price of homes sold in Washington DC in January 2025 was $139,000 less (down 8.3%) than sales in January 2024, BUT:

• The average home price in January 2025 was UP $19,677 (up 2.4%) compared to January 2024

• The main reason the median price fell so much in January ’25 compared to January ’24 is that there were more less expensive condos/coops sold in January 2025 compared to 2024 (201 in 2025 vs 168 in 2024) so what we’re seeing with median price is more to do with the data skewing more heavily to less expensive properties being sold than the properties that were sold being worth less money.

• “4,000 homes have been listed for sale in and around Washington DC” is stated with no context. 4,000 homes being listed for sale in the Greater DC Area is actually very low. Over the last three years, there are an average of nearly 7,000 homes listed for sale each month and an average of over 9,000 homes listed for sale each month over the last ten years. In fact, over the past ten years, there have only been THREE months with total listings below 4,000 (each of the past three Decembers).

• Most homes that close/sell in January go under contract in November or December of the prior year, so January closing prices had nothing to do with DOGE cuts (you could argue that it’s election-related, but that’s also not accurate)

Year-over-Year Inventory is Exploding in the DC Area!

Many astute internet people have pointed out that inventory levels in the DC area are exploding, up 22.8% year-over-year in the DC Metro in January. You MIGHT have a point, but…inventory in the US (source) is up 24.6% year-over-year in January so inventory levels in the DC area are actually increasing at a slower pace than the country overall.

Dig a little further into the DC area data and you’ll find that most of this increase in inventory is from the DC condo market, which has been struggling since Summer 2020. Condo inventory in the DC Metro is up 31.6% year-over-year as of January, but single-family detached is up only 10%.

Downtown DC is Full of Homes for Sale!

The other visual I have seen getting a lot of attention is a snapshot of all the active listings in Washington DC, highlighting the density of the “for sale” icons near downtown like the screenshot below. The conclusion people are drawing is along the lines of “oh my god, look at all these homes for sale near downtown, everybody is fleeing because DOGE/Trump are taking away the gravy train!” Here are the problems with that conclusion:

• The volume of listings for sale that you see near downtown is because that is where the multi-family (condo and coop), most densely packed housing is located. Notice you do not see the same density of for sale listings where…housing is less dense…

• The 16th St Corridor, the area you see in the middle of the map running north/south with a lot of listings, has looked like this for 3-4 years and has nothing to do with the DOGE/Trump cuts. It’s a dense condo market in neighborhoods that have struggled to bounce back to their pre-pandemic demand

• This is a snapshot in time with no comparison to past inventory levels or inventory trends, it says nothing about causation related to DOGE/Trump. Trend lines do not exist when you offer one data point.

Will Inventory Levels Explode and the Market Crash?

I wrote at length last week (link) about how the DOGE cuts are effecting the market (TL;DR: most sub-markets have runway to withstand lower demand and/or high inventory before prices drop). I would be naïve to say that the DOGE/Trump cuts to federal workforce and spending won’t lead to increases in housing inventory and the potential for home values to fall in and around DC, but the current data and market conditions (multiple offers on homes within days of hitting the market) does not show anything along the lines of what People-on-the-Internet are claiming.

Will more people sell their home and demand drop because of the local job/spending cuts? I’m sure of it. Will we see an explosion of inventory soon? I doubt it. Deciding to sell your home is a big decision and most people, especially those with kids and a purpose here outside of work, are not going to make that decision right away. Most will do everything they can to keep paying their mortgage, wait to see how the dust settles, and work hard to find new, local employment. The inventory shift will likely happen over months/years, not days/weeks, and it's no certainty that a drop in home values will follow.

I could go on and on, but if you’ve stuck with me this far, thank you. You are always welcome to reach out to me for real housing market data to help sift through the noise. Sign-up for my monthly real estate newsletter (and no spam) using this link. If you’re considering buying or selling a home in Northern VA, DC, or the MD Suburbs you can reach me at [email protected] or (703) 539-2529.

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