High interest rates and thin inventory drove the decline. Existing home sales nationally fell 1.5% from November to December, and were down a whopping 34% comparing December 2022 to December 2021, according to data from the National Association of Realtors. That capped a full year of existing home sales just over 5 million units nationwide, down 17.8% from the prior year. I’m Kevin Grolig, a Compass agent based in Potomac, Maryland, and I’ve called Montgomery County home my entire life. I specialize in helping people relocate here, and every month I look at the national numbers and then translate what they actually mean locally. Because here’s the thing — while the national data showed 11 straight months of declining sales, Montgomery County was telling a completely different story on the ground, and that gap is exactly what buyers and sellers need to understand before making a move.
What caused the 11-month decline in home sales?
Rising interest rates paired with limited inventory did the damage. NAR Chief Economist Lawrence Yun called December “another difficult month for home buyers,” pointing directly to buyers continuing to face limited inventory and high interest rates at the same time. That combination is what pushed existing home sales down 17.8% for the year and 34% year-over-year in December alone. It wasn’t that people stopped wanting to buy homes — it’s that higher borrowing costs priced a lot of buyers out of the market or shrank what they could afford, while there simply weren’t enough homes listed to give them options. Yun also noted he expects sales to pick back up as interest rates decline from their 2022 peak, which is a detail worth remembering as you read the rest of this.
How tight was inventory nationally during this stretch?
Inventory was tight, but it was still an improvement from the month before. The total national home inventory at the end of December 2022 sat at 970,000 units for sale, down 13.4% from November but up 10% from the same time the year prior. NAR calculated that as a 2.9-month supply of inventory nationally. That’s well below the 5-to-6-month range typically considered a balanced market between buyers and sellers, which tells you that even with sales falling for 11 straight months, the country never had a surplus of homes sitting unsold. Scarcity was still the defining feature of the market — buyers just had less purchasing power to compete for what was available.
Did Montgomery County see the same slowdown as the rest of the country?
No — and this is the piece that actually matters if you live here. While the national numbers showed a market in retreat, Montgomery County only had about one month’s supply of inventory at the same time. One month of supply means that if zero new listings hit the market, everything currently for sale would sell out within 30 days at the pace homes were moving. That’s still a market that clearly favors sellers. Yes, there was less demand in Montgomery County than at the same time the year before — I won’t pretend otherwise. But less demand than an all-time frenzy is not the same thing as a weak market, and anyone assuming Montgomery County was “crashing” because of the national headlines was working off the wrong data entirely. Real estate is local, full stop.
Were multiple offers still common in Montgomery County?
Yes, just not at the extremes we saw before. During the height of the pandemic-era market, it wasn’t unusual to see 10, 15, sometimes 20 offers on a single property. That kind of frenzy had cooled by early 2023, but most of the homes we sold that year were still drawing two, three, sometimes four or five offers. That’s meaningfully calmer than the year before, but it’s still real competition. If you were hoping to walk into Montgomery County and buy uncontested just because national sales numbers were down for 11 months in a row, that wasn’t the reality on the ground here.
Was the market actually turning a corner in early 2023?
Yes, and I was seeing it firsthand before it fully showed up in the national data. Even with year-over-year demand down, I was seeing more showings, more people coming through open houses, and multiple offers creeping back into the picture compared to just a month or two earlier. So while the headline said sales had fallen for 11 consecutive months, the ground-level trend in early 2023 was already pointing up. That’s the risk of only reading national statistics — they describe where the market has been, not necessarily where it’s heading next. Whether you’re buying, selling, or both, expect competition, and align yourself with an agent who has boots on the ground and a finger on the pulse of your specific market, not just the national wire.
What should this mean for your next move in Montgomery County?
It means don’t make decisions off national headlines alone. Certain locations and price ranges within Montgomery County run hotter or cooler than the countywide trend, and a statistic like “sales down 34% year-over-year” tells you almost nothing about what’s happening on a specific street in Potomac, Bethesda, or anywhere else in the county. A true professional helps you navigate those twists and turns with real local data, not a nightly news soundbite. You can review current local numbers yourself on mystats page, and if you’re weighing a purchase in this kind of market, myguide to buying a homewalks through how to compete smart without overpaying.
For the full national research behind these figures, NAR’sresearch and statistics hubpublishes the data referenced throughout this piece.
FAQ
Did home sales really fall for 11 straight months nationally?
Yes. NAR’s data showed a full year of declining existing home sales, finishing 2022 down 17.8% from 2021, with December down 34% compared to December 2021.
Does a national sales decline mean Montgomery County home prices were falling too?
Not necessarily. Fewer national transactions closing isn’t the same as falling local prices. With only about a month of supply in Montgomery County, sellers still held the advantage here.
Were interest rates the main reason for the decline?
They were a major factor, alongside limited inventory. NAR’s own chief economist named both as the two forces buyers were fighting against each month.
Was Montgomery County ever a buyer’s market during this stretch?
No. One month of supply is far below the 5-to-6-month range considered balanced, so it stayed a seller-favored market even with less demand than the year before.
How do I know what’s happening in my specific neighborhood right now?
The fastest way is to talk directly with a local agent tracking the numbers month to month.Contact meanytime and I’ll walk you through your specific area and price range.
Real estate is local, and the space between a national headline and what’s actually happening in Montgomery County is exactly why I break these numbers down every month. If you’re considering a move to, from, or within Montgomery County, let’s talk specifics.
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Sources and next steps
Verified local sources:U.S. Census QuickFacts for Montgomery County;WMATA maps and schedules;Montgomery County Open Data;Montgomery Parks trails and facilities.
Related Kevin guides:relocation guide;home buying guide;book a call.
Watch the YouTube videoorbook a 30-minute strategy call with Kevin.
Expanded local research sources:Visit Montgomery travel guide;Visit Montgomery restaurant directory;Tripadvisor Montgomery County things to do;Tripadvisor Montgomery County restaurants;Google Maps restaurants near Potomac;Google Maps things to do near Potomac;Reddit MoCo discussion search for Potomac;Reddit thread: moving from DC to MoCo;Reddit thread: visitor activities in MoCo;WMATA rail and bus maps;Montgomery Parks;Montgomery County Open Data;Niche Montgomery County livability;MoCo360 local news.
Contextual links for this video
Kevin site links:Potomac guide;home selling guide;home buying guide;Montgomery County relocation guide;market stats.
Outside research links for this video:Visit Montgomery travel guide;Visit Montgomery restaurants;Google Maps restaurants near Potomac;Reddit discussion search for this topic;Google context search for this video.
Kevin process link: why Kevin’s local process matters.