Do you believe that small drop is a result of new development or just a blip in the market? Price increases near me definitely slowed as interest rates increased, but we haven't yet seen a drop. But, as far as I know, this is one of the only walkable areas outside the Beltway, so there's a lot to like if you want to be untethered from a car for much of the week. It's also a relatively affordable area (vs inside the Beltway and some SFH neighborhoods) - my TH 1500sqft (1800 if you include finished basement space) would currently sell for ~$700k. The new-build THs are 2500sqft, with a garage or two, and sell for just over $1 million.

> Do you believe that small drop is a result of new development or just a blip in the market?

I don't know, and I don't believe it's possible to know in a specific instance. Like I said above, I believe that in the long term, denser towns raise the property values of their suburbs by making the area more desirable.

But there is definitely a plausible case that increasing the supply of housing immediately lowers or slows the growth of property values by reducing scarcity. It's the argument made by both sides of the "missing middle" debate in Arlington -- the pro side says it will make housing more affordable, and the con side says it will lower everyone's property values. The article we're commenting on found that at least some version of this is true for the Austin, TX -- increasing housing stock lowered rents, even if the new stock is luxury units.

But rents aren't the same as property values (though they are linked). Rents could go down while the value of the underlying land goes up (extreme example - build a high-rise apartment, land and building value goes up, even though the rent for each unit comes down). And the apartment market and SFH market are linked but also not exactly the same.

Also agree it's difficult/impossible to know for a single piece of real estate. And impossible to know for sure since the market is complex (impacted by rates, other policy decisions, etc)

You're right, but I think everyone is looking at second-order effects where causal links are impossible to prove. [0] is recent research on how expanding housing stock (even just at the top end) will "expand affordability," although they, too, are mostly looking at the effect on rents.

The most overt statement of "we don't want to build more houses because it will decrease the value of existing houses" in recent memory was Trump[1], who is not exactly a reliable source (and whose whole brand prior to politics was destroying the character of established neighborhoods by building giant condo complexes).

[0]: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5780364 [1]: https://www.msn.com/en-us/money/general/trump-says-the-quiet...