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Have you heard, the housing market in Washington, D.C., is crashing?
That, at least, was the takeaway over the last week on social media. The gist is that as Elon Musk’s Department of Government Efficiency (DOGE) has looked for ways to pare down the government, sweeping layoffs are having a devastating trickle down effect on the housing market. Everyone is losing their jobs, in other words, so listings are soaring, prices are dropping and closings are drying up.
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The story has a certain logic to it, which is probably why it has gone viral. But Inman wanted to know what was really going on, and so reached out to several different companies that compile housing data. And, somewhat surprisingly, they all basically said the same thing: There is no housing crash in Washington, D.C.
Overall, the data from these companies paints a picture of a market that is somewhat soft, but not significantly more so than many other places. The experts consequently attributed trends in the D.C. market to other factors and said they’re still watching for future data to see if upheaval in the federal workforce ultimately has any measurable impact on housing.
The origins of a housing panic
The myth of a market crash in Washington, D.C., arrived in recent days against the backdrop of significant political anxiety. That anxiety is a result of Donald Trump’s efforts to deliver on campaign promises and disrupt the government’s status quo. And DOGE, which has spearheaded the termination of thousands of employees across numerous government agencies, is chief among Trump’s disruptive forces in Washington, D.C., right now.
Social media commenters began connecting the DOGE layoffs to the housing market in recent days. On Feb. 15, for example, one person on X (formerly Twitter) characterized the housing market in Washington, D.C., as “absolutely insane.” By Wednesday, more than 9 million people had viewed the post. Another asserted that the capital’s “housing market is being affected by the layoffs.” That post has so far landed in the feeds of more than 300,000 people.
Before long, news outlets picked up the story. For instance, over the weekend The Daily Mail claimed that the “Washington DC housing market plummets as DOGE lays off thousands of federal workers.” Newsweek ran a similar story a day later.
The data tells a different story
But all of the data Inman reviewed suggests there is no crash.
For example, when Inman reached out to Bright MLS to ask about a crash, the answer was unequivocal: “The short answer: No,” Bright said in a report provided to Inman.
The report went on to say that between Feb. 2 and Feb. 16, 2,829 new listings hit the market in the D.C. region. But the report also noted that the number is “virtually unchanged” compared to the 2,820 new listings that hit the market during the same period in 2024.
“Based on our listing data, we’re not seeing any evidence of a surge of listing activity in the Washington, D.C., region,” the report concludes.
Redfin offered a similarly sober view. In an X post, Chief Economist Daryl Fairweather said that despite turmoil, the D.C. housing market “is business as usual.” Redfin also provided numbers to Inman in a report showing that in January the typical home in the D.C. metro area sold for 2 percent more than it did last year at the same time.
Joel Berner
The business-as-usual thesis is further reinforced by still more data. For example, Realtor.com Senior Economist Joel Berner pulled numbers for Inman and found that “the median listing price is down about 3 percent year over year, but that’s not much different from the national figure.”
He also found that time on market is down “and well below the national mark,” and that “price reductions are basically flat YoY but starting to turn positive.”
Berner’s takeaway was that the D.C. market “appears to be a little slow, but so are most markets across the country.”
Finally, Mike Simonsen — founder and president of Altos Research — told Inman that “there is nothing in the Washington D.C. housing data that says the market is crashing.” Simonsen added that inventory is still low, and, while higher than last year it remains below pre-pandemic levels. He also said that data on price cuts in the region suggests “demand in D.C. looks very similar to the rest of the country. Homebuyer demand is down, and prices are soft.”
Mike Simonsen
Simonsen additionally poured cold water on the internet rumor mill.
“The internet chatter this weekend was about the new listings volume,” Simonsen said. “But of course, they only had a single screenshot from Zillow which doesn’t show the normal levels.”
The real story: The spring market, high rates and more
In a conversation with Inman, Chen Zhao — head of economics research at Redfin — agreed with other experts, saying that in terms of new listings in the D.C. area there’s “nothing interesting going on.” But she added that normal seasonality may be driving some of the crash narrative.
Chen Zhao
“I think a lot of homes are coming onto the market because we’re entering the spring homeselling season,” Zhao said. “This happens every single year, and it’s not because of what’s going on with DOGE.”
Redfin’s numbers do note some apparent, if not tremendous, weakness in the D.C. market and point out that pending sales are down 11 percent year over year. But the company’s report attributes the situation “primarily” to high mortgage rates that are “holding back buyers.”
Chen also pointed out that while Washington, D.C., has the highest concentration of federal workers, those workers still make up a relatively small share of the overall federal workforce.
Government data backs this up. According to the U.S. Office of Personnel Management, the D.C. metro area is home to 282,666. That’s only about 15 percent of all federal employees. The District of Columbia itself has 141,367 federal employees, which is 7.56 percent of total federal workers. To put that into perspective, another 8 percent of all federal workers are based in California.
What this means is that cuts to the federal workforce are likely to have a more distributed, and muted, impact on any specific housing market.
It’s too soon for the sky to be falling
Of course, none of this is to say that times aren’t tough for some people. Redfin told Inman, for instance, that company agents are reporting anecdotal cases in which federal workers are pausing home searches. And many individual people are experiencing disruptions to their employment and income that could ultimately impact their housing as well.
But the experts agreed that only time will tell if these individual stories of hardship turn into the kind of trend that is already being discussed on social media. Realtor.com, for instance, suggested that while there’s no evidence of a crash yet, “we may not see the effects of a true phenomenon in our data for a few weeks or months.” Redfin said essentially the same thing, noting in its report that “it’s too soon to see an impact in the housing market data.”
For her part, Zhao will be keeping an eye on data that arrives in March and describes February. But by then, its anyone’s guess what might be happening.
“What’s happening with DOGE and all these cuts,” Zhao said, “this is still a developing story. It may die down. It may get worse. Who knows?”
