- Foggy Bottom’s median sales price saw a 46 percent drop in 24 months
- In most part, DC is still lacking affordable inventory for buyers and renters
- The DC market is one of the most impacted by seasonality
DC might not fall into the least affordable places to live in the U.S. – but it certainly doesn’t make the bargain belt, where middle-class income earners spend as little as 16 percent of pay on housing.
The nation’s capital is one of the pricier markets in the nation, so navigating and examining each neighborhood properly is key – especially when consulting a new buyer or renter in the city. Even minor shifts in typically moderate-to-high priced neighborhoods can indicate lower demand, fluctuating inventory or new developments across the city.
Price drops can start in small increments and over the course of a few years, accumulate to hundreds of thousands shaved off the median neighborhood value. Check out four popular Washington, D.C. neighborhoods that fluctuated in price this February.
Foggy Bottom for-sale slips
The median sales price in Foggy Bottom has trended downward over the last few years. In February of 2014, the median sales price was $695,917.
Two months later, in April of 2014, prices hit their two-year peak at $697,359. Today, Foggy Bottom’s median sales price stands at $376,321– a 46 percent drop in 24 months’ time.
However, unit size in Foggy Bottom has also decreased significantly in the same time frame, from 1,277 square feet last February to 868 square feet last month. Lower prices likely reflect newer developments with tighter, more compact condos.
Yet, rents in Foggy Bottom don’t correlate.
In fact, they’ve continued to rise, hitting a median $3,452 in February. The median rent has increased 63 percent year-over-year in Foggy Bottom, given the median price in February 2015 of $2,113 per month.
While for-sale units have become significantly smaller over the past few years, Foggy Bottom apartments gained square footage to correspond with increasing rent prices. Last month, the median apartment size grew to 1,102 square feet from just 675 square feet last year.
Downtown: a better buy, rents to rise?
Downtown sales prices dipped from a median $634,092 in January to $630,144 last month. Home values in the neighborhood began to move forward in February of last year when median price shifted from $552,839 to $610,833 month-over-month. But, last June when Downtown reached a peak $666,120, a steady decline ensued.
Rents aren’t cheap Downtown at a median $2,882 per month, but dropped slightly in February from a previous $2,982. However, seasonality plays a role in rent prices – especially in cities like DC – and it’s not unlikely that rents will spike again to prior levels as the Spring season inspires rental demand.
Prior to the dip, rent in Downtown Washington, D.C. reached $2,976 per month in December after climbing steadily over the past two years. In February of 2015, the median price was $2,596 per month.
Logan Circle has kept fairly steady pricing over the past two years. In February of 2015, the median sales price was $664,781, and while values increased month-over-month throughout the first two quarters of 2014, they began to drop come June.
In February, home prices in Logan Circle stood at $672,676, a drop from the previous month when the median was $678,963. In December, the median sales price was $685,152.
Prior to that, sales prices were steadily increasing.
Leasing in Logan Circle has become slightly less expensive over the year, but rents seem to be trending upward once again. In February of 2015, the median rent was $2,859. After a year of declining, the median price point is on the rise again, reaching $2,828.
While Adams Morgan real estate is another generally steady market in the D.C. area, the neighborhood experienced a slight month-over-month dip in February. The median sales price was $547,654 – a minor drop from the month prior when the median sales price was $550,120.
Rents in Adams Morgan, on the other hand, are more tumultuous.
Lease prices were dropping fairly significantly up until last month when they reached $2,859 per month from a prior $2,721 per month.
However, the general trend in Adams Morgan rent indicates decline, especially considering the price point just two years ago. In February 2014, the median rent was a high $3,177 per month.
Affordability for homes in DC might be hard to come by, but keeping a keen eye on monthly trends may help agents pinpoint the best opportunities for their clients.