Residential real estate was practically the only type of market that flourished in 2020, with Americans spending most of their time at home during the past year. Of course, the market went through a rough patch especially at the start of the pandemic, but home sales increased gradually as more time passed.
In case you’re wondering what’s in store for the DC housing market this year, here’s a look at current real estate trends:
A promising start
Despite the impact of the pandemic on our daily lives, DC’s median sale prices increased to $682,500 at the end of 2020, which was 13% higher compared to July 2019 and 5% higher than June 2020. Together with record-shattering home prices, the total number of homes sold increased by 20.1% year-over-year.
These two data points are indications that the District’s real estate market is experiencing high demand and activity entering the traditionally slow seasons. Home prices have increased significantly in DC, with 36.5% of homes being sold far above the listing price, while average rent has dropped by 14%.
The significant gap between the increase in home prices and the decrease in rental prices suggests that more DC residents are aiming to become homeowners or searching for neighborhoods with more affordable rental properties.
Intense competition for single-family homes
The competition for detached, single-family homes is currently heating up. The median price for single-family homes across the DC metro area hit $737,500, increasing by around 4% since April. There has been a particularly high demand for single-family houses which were priced above $950,000, with 60% selling above their asking price. Listings in Montgomery County sold at a record-high pace, staying on the market for a median of six days.
There was also a modest increase in condo prices, with the median price increasing by 0.3% in April to $367,180. Condos stayed on the market for a median of 14 days, compared to six days for other property types in the DC metro.
The next “it” neighborhoods
Neighborhoods such as Dupont, Georgetown, Logan Circle, and West End are already established neighborhoods when it comes to homes with lofty prices. But for those hunting for a bargain or searching for up-and-coming neighborhoods, the northeast may be a great place to start.
Communities such as Edgewood, Kingman Park, and Trinidad, which all have affordable prices and great potential, are worth checking out. The neighborhood of Brookland is also a terrific option for those looking for quality single-family homes at affordable prices, as its abundance of space as and vibrant art and dining scene give it tremendous potential as an up-and-coming neighborhood.
All things considered, the DC housing market seems to have dealt with the setbacks caused by the pandemic fairly well, especially when compared to other major cities across the US. While some of the effects of the pandemic are still evident in some areas, the city, in general, is certainly making a strong comeback, which makes it an excellent choice for real estate investors.
Planning to relocate to the DC area? Get in touch with Heller Coley Reed of Long & Foster Real Estate today! You can reach her by calling 240.800.5155, or send her an email at hellercoleyreed(at)gmail(dotted)com.