The Washington, DC metro area housing market in February 2025 presents a complex landscape characterized by rising prices and declining sales activity. The Median Sales Price has increased to $559,495, reflecting a year-over-year (YoY) growth of 6.3%. Similarly, the Median List Price has risen to $597,250, marking a 6.7% YoY increase. These figures indicate a robust appreciation in property values, suggesting strong demand despite other market challenges.

However, the number of Homes Sold has decreased significantly, with a 10.6% YoY decline, totaling 3,214 units. Pending Sales have also dropped by 11.4% YoY, reaching 4,069. This reduction in sales activity may be attributed to various factors, including affordability concerns and potential buyer hesitation in a rising interest rate environment.

New Listings have seen a modest decline of 3.2% YoY, with 4,589 properties entering the market. Meanwhile, inventory levels have increased by 11.3% YoY, totaling 8,142 homes. This rise in inventory, coupled with a 50% YoY increase in Months of Supply to 2.5 months, suggests a shift towards a more balanced market, offering buyers more options and potentially easing competitive pressures.

The Median Days on Market have remained relatively stable, with a slight 1.0% YoY increase to 36 days. This stability indicates that while homes are taking slightly longer to sell, the market remains relatively active. The average sale to list ratio has experienced a minor decrease of 0.1% YoY, standing at 100.1%, suggesting that homes are still selling close to their asking prices.

Interestingly, the percentage of Homes Sold above list price has decreased marginally by 0.1% YoY to 39.3%. This slight decline may reflect a cooling in bidding wars, as buyers become more cautious. Additionally, the proportion of Price Drops has increased by 4.3% YoY to 21.5%, indicating that sellers may be adjusting their expectations in response to changing market dynamics.

The percentage of homes going off the market within two weeks has decreased by 3.9% YoY to 52.2%, further highlighting a potential slowdown in buyer urgency. This trend, combined with the increased inventory and Months of Supply, suggests that the market may be transitioning from a seller's market to a more balanced environment.

Overall, the Washington, DC metro area housing market in February 2025 is characterized by rising prices and a slowdown in sales activity. While property values continue to appreciate, the decline in sales and increase in inventory suggest a shift towards a more balanced market. Buyers may find more opportunities and less competition, while sellers may need to adjust their pricing strategies to align with evolving market conditions.