By TED SMITH
“DC Metro [Region] Closes 2012 with Double-Digit Price Growth” shouts the headline of an article posted on the home page of Real Estate Business Intelligence on Jan. 10. It’s true that 2012 was a better year for D.C. Metro real estate, with median housing prices up 10.5 percent over 2011, and the number of sales up 4.9 percent across all market segments. Condo sales were up 7.3 percent over last year and achieved a median increase of 10.4 percent right up there with the overall housing price median.
But when you dig deeper into the article, you find that, while year-over-year figures for prices and numbers of sales are higher, the number of new sales contracts year-over-year has declined, especially in the last two months. Further, the sales inventory has declined, with active listings dropping to below 7,000 for the first time in seven years and with new listings in December being the lowest on record.
Yet, as mortgage interest rates continue to drop, there are more buyers out there looking for a place, leading to increased competition and (often) bidding wars for the limited inventory that’s available. Thankfully, a number of new condo projects in the works may alleviate some of this demand. According to Urban Turf (dc.urbanturf.com), there are 45 new condo projects that will deliver 2,676 units by the end of 2014, some of them delivering right now. Additionally, there are nine projects representing 1,012 units that are as yet undecided between going live as condos or apartments. And for buyers who choose to rent while waiting to find the right property, there are 60 new apartment complexes planned in the District that will deliver an astounding 15,025 units by the end of 2014. No wonder the business press is predicting a drop in D.C. rent prices over the next two years.
So if you’re looking to buy a condo, take heart: your choices will be expanded over the next two years. And what are the implications if you’re the owner of an existing condo? Now would be a good time to sell before all that extra competition hits the market.
Ted Smith is a licensed Realtor with STAGES Premier Realtors specializing in mid-city D.C. Reach him at TedSmithSellsDC@stagesrealtors.com and follow him on Facebook.com/MidCityDCLife, Youtube.com/TedSmithSellsDC or @TedSmithSellsDC.