Summer's here and real estate sales prices in Washington DC are rising faster than the temperature – up an extremely robust 12.9% over the past year. This is even higher than Washington Metro on whole, which is also posting strong gains at 8%, year-over-year. The month of May showed a seven-year high with an added bonus of increased inventory as more sellers looked to take advantage of favorable conditions. Whether this trend continues is anyone's guess – summer is always peak time for both sides of the market. There is also the effect of new housing starts that occurred earlier in the year – a number of new multifamily units have been delivered recently.
Key real estate trend metrics released in May of this year show that Washington DC Metro and the city itself are back to peak housing boom levels established before the economic downturn of 2008. This in itself isn't completely surprising – DC itself was not as adversely affected as other parts of the country. Regardless, it's great news. The data points to continued growth throughout the summer – June's numbers have continued to climb across the board, including units sold, median sales price and new listings. Of the various property types, townhouses have led the pack as far as the number of new contracts while single-family homes accounted for the biggest gain in sales prices.
It's worth noting that not everyone is on the exact same page when it comes to numbers. Data from RBI (Real Estate Business Intelligence) has been indicating a continued growth in multifamily dwellings while some other sources point to a lower than normal stock in actual present condo inventory. To a large extent, this is a result of recent sales. Almost all sides agree that a new inventory spike is on the way however. Real estate research firm Delta Associates predicts that new multifamily construction for the year will wind up being the highest since 2006.
Let's dial in a little bit more on some specific areas of Washington, DC. Prices in some of the luxury suburban neighborhoods like Chevy Chase, Kent and Berkley have been fairly flat – the latter community has actually experienced a dip. On the other hand, popular townhouse-centric communities like Adams-Morgan, Logan Circle and Kalorama have experienced solid real estate value growth over the past year, ranging from 8.4 to 11.6%. Columbia Heights which has occupied some of the middle ground when it comes to rowhouse values in recent years has seen a more dramatic uptick with a 16.6% bump in value and a 20.9% increase in closing price.
So if some of Washington DC's neighborhoods are relatively flat and some show solid gains, how can the metrics show an overall sale price gain of 12.9%? The answer lies in some of the modestly priced outlying neighborhoods that represent true targets of opportunity. According to data giant Zillow, the value index in Benning Ridge climbed 10.2% over the past year while list prices soared 37.6%. Bloomingdale's value climbed 17.8% while list prices are up 23.4%. Real estate values in Anacostia climbed 36.3% over the past year, with a more modest 5.9% climb in list. And the biggest mover? Fort Davis, still riddled with short sales and foreclosures, showed a 21.7% value increase and a whopping 73.3% increase in list, currently standing at a low median of just $249,900.
As you can see from the numbers, there's something for everyone when it comes to Washington DC real estate market trends in the 3rd quarter of 2013. This summer you can find a price reduction on a multimillion dollar mansion or bid over list for a highly sought-after rowhouse in the heart of Washington. Or, you can look toward the future with some of the less trendy neighborhoods that have been hovering on investors' radars. The one thing that's certain is that the nation's capitol will continue to grow and prosper.
Andre Perez | District One Properties LLC | Realtor/Agent/Owner
1305 Leslie Ave, Alkexandria, VA 22301