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Washington D.C. Real Estate Market And Trends

As the nation’s capital, the Washington D.C. real estate market continues to take impressive steps in the right direction since the recession. The median home price in the Washington D.C. area is $370,400; compared to the national average of $215,767. What’s more, prices continue to grow relative to last year. Both closed sales and pending sales in Washington D.C. for the first quarter of 2016 continue to be above their previous levels, with homes selling faster now than 2015. However, a shortage in the number of homes for sale across the nation, which is down nearly six percent from a year ago, continues to hinder potential home sale potential in the Washington D.C. real estate market

The Washington D.C. real estate market has been able to recover from a period of post-recession price weakness, due – in large part – to strengthening values. However, while trending up, expectations need to be tempered. While prices are up, the rate in which they are appreciating is beginning to slow. Home values have gone up 5.9 percent over the past year and Zillow predicts they will increase 2.1 percent in 2016. For all intents and purposes, Washington D.C. investors should continue to focus their attention on this local market.

Washington D.C. Real Estate Market Statistics:

Washington D.C. infographic

According to Trulia, the average Washington D.C. home is worth about $515/sqft. Price increases have removed Washington homes from the doldrums of the recession, as the current median home price for the region is now $370,400. The current value represents a modest 0.7 percent increase in the last year. The last three years has seen home values in Washington D.C. increase 6.2 percent compared to the national average of 22.6 percent. Over that same period, homeowners have gained an average of $40,574 in equity. Popular neighborhoods leading the Washington housing market include: Dupont Circle and Georgetown. It’s also important to take note that price appreciation and principle payments in the Washington D.C. area have pushed total equity growth since the recession. For a more comprehensive breakdown of equity, refer to the following:

  • Homes purchased in the Washington, D.C. housing market one year ago have appreciated, on average, by $8,773. The national average was $15,781 over the same period.
  • Homes purchased in the Washington, D.C. housing market three years ago have appreciated, on average, by $40,574. The national average was $49,356 over the same period.
  • Homes purchased in the Washington, D.C. housing market five years ago have appreciated, on average, by $98,173. The national average was $68,727 over the same period.
  • Homes purchased in the Washington, D.C. housing market seven years ago have appreciated, on average, by $121,541. The national average was $59,758 over the same period.
  • Homes purchased in the Washington, D.C. housing market nine years ago have appreciated, on average, by $3,099. The national average increased $16,435 over the same period.

One of the interesting factors affecting the Washington D.C. real estate market is the number of properties in some stage of foreclosure. According to RealtyTrac, there are currently 348 properties in some stage of foreclosure. However, the number of properties that received a foreclosure filing in June was eight percent higher than the previous month, and 165 percent higher than the same time period in 2015. The number of new foreclosure filings by foreclosure type is as follows:

  • Auction homes have increased by 61.1 percent over the past month, and 383.3 percent over the last year.
  • Bank owned properties have decreased by 45.0 percent over the past month, and 29.4 percent over the last year.

Washington. D.C.: Real Estate Market Summary:

  • Current Median Home Price: $370,400
  • 1-Year Appreciation Rate: 0.7%
  • 3-Year Appreciation Rate: 6.2%
  • Unemployment Rate: 4.1%
  • 1-Year Job Growth Rate: 2.8%
  • Population: 601,723
  • Median Household Income: $91,193

Washington, D.C.: Real Estate Market (2016) — Q1 Updates:

2016 has started off somewhat tame for the up-and-coming Washington D.C. real estate market. The current median home price is $370,400, down slightly from the previous year, while home appreciation gains continue to remain slow. However, the Washington D.C. real estate market has maintained a 0.7 percent gain in the past year, and 6.2 percent gain in the past three years.

Home affordability continues to make the real estate market in Washington D.C. appealing to investors and homebuyers alike. The monthly mortgage payment to income for homeowners in Washington D.C. for the first quarter of 2016 was 12.2 percent compared to the national average of 14.5. Additionally, the median home price to income ration for Q1 2016 was 2.2 for Washington D.C. compared to the national average of 2.6. With the price-to-income ratio falling, the Washington D.C. real estate market continues to be one of the more affordable in the nation.

Growth for the rest of 2016 is expected to be tame compared to past years where prices have grown rapidly. According to the National Association of Realtors, higher prices are expected for the Washington D.C. area for the next 12 months, as price expectations are forecasted at 6.3 percent compared to the national average of 3.8 percent.

Washington, D.C.: Real Estate Market (2015):

The Washington D.C. real estate market continued to improve in 2014. The last part of the year saw the median home price in Washington D.C. hit $371,600 compared to the national average of $221,067. Despite the advantage in home prices, the Washington D.C. real estate market saw minimal gains in the fourth quarter of 2015, achieving a -0.3 percent appreciation compared to the national average of 6.5 percent.

In terms of equity, homes in the Washington D.C. real estate market earned $4,816 in equity compared to the national average of $16,784; while the last three years has earned $38,134 compared to the national average of $52,129. Despite the gains and owners paying down on principle, price trends in the last three years have undercut the steady post-recession home equity growth.

Unemployment rates continue to assist the real estate market in Washington D.C. Rates for unemployment in the fourth quarter of 2015 were 3.8 percent, compared to the national average of 5.0 percent, and down 0.6 percent from the previous year. In addition, job growth for Washington D.C. remains competitive compared to the national average.

For potential homebuyers, affordability in the Washington D.C. real estate market continued to make strong improvement in 2015. Compared to its historical average of 16.2 percent, home affordability in the Washington D.C. real estate market was 12.7 percent in the fourth quarter of 2015, while the national average was 15.1 percent.

Washington, D.C.: Real Estate Market (2014):

2014 saw confidence return in the Washington D.C. real estate market, as sales picked up. According to RealEstate Business Intelligence (RBI), there were nearly 300 more homes sold at the beginning of 2014 than the previous year, which represented an increase of eight percent.

Pending home sales in 2014 also offered some encouraging insight as to the direction of the Washington D.C. housing market in 2015. In late 2014, pending home sales increased 11 percent year-over-year with the gain representing the only increase in pending sales since November of 2013. According to the Washington Post, “there were 8,267 active listings at the end of December 2014, 19.1 percent more than December 2013. New listings grew by 331 listings, a nearly 13 percent increase compared to December 2013.”

Washington D.C. Real Estate Map:

Map of Washington DC neighborhoods

*The information contained herein was pulled from third party sites. Although this information was found from sources believed to be reliable, FortuneBuilders Inc. makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. Any reliance on this information is at your own risk. All information presented should be independently verified. FortuneBuilders Inc. assumes no liability for any damages whatsoever, including any direct, indirect, punitive, exemplary, incidental, special, or consequential damages arising out of or in any way connected with your use of the information presented.

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