April housing figures in the Washington area confirm the market is returning to normal after an intense years-long boom, according to analysts.
The data, released Thursday by George Mason University’s Center for Regional Analysis, show both a further curbing of housing price increases and a jump in the number of days homes remain for sale, both signs of a cooling market.
Stephen Fuller, the center’s director, predicts a single-digit price increase in 2006, following a jump of more than 20 percent in 2005.
The average house stayed on the market for 62 days in April, 37 days more than in the same month last year. The average sale price increased 5.4 percent over April 2005, which saw a 25 percent increase over 2004.
The slowdown, Fuller told the Northern Virginia Association of Realtors, is resulting in less “flipping” and more long-term buyers. “There are other things to do with your money,” he told investors.
“This is a time to diversify,” he said. “The housing market will not be as hot [for] the next 10 years as it was the last five.”
For this year and the next, the Center for Regional Analysis predicts sales volume will drop back to the levels seen in 2002 and 2003.
Fuller said job growth — a figure heavily correlated with housing price changes — will still be strong in the region in the coming years, however.
The changes shown in the April data, said Northern Virginia Association of Realtors spokeswoman Jill Landsman, reflect “what they’re calling a soft landing,” as opposed to a bust.
“By comparison it seems like a huge change,” she said. “But the truth is, it mirrors a normal market.”
