D.C. homebuyers beware: High prices ahead
Recent housing data shows the D.C. market is still wild, Axios' Paige Hopkins reports.
Why it matters: Even with a slight increase in inventory, the market still hasn't settled back down to pre-pandemic levels, which makes it harder for homebuyers with tighter budgets who can't afford to offer above asking price or pay in cash.
- Due to rising home prices, younger people, specifically those under 45, are opting to rent rather than buy.
- The DMV has 14 suburban areas where the majority of residents rent — that's more than any other major metro in the country, according to reporting by DCist.
By the numbers: The median sales price for detached homes in the District was a staggering $1.27M in June 2021, according to the Wall Street Journal.
- Data from the Greater Capital Area Association of Realtors (GCAAR) shows the median sale price in the region was $585,000 in August.
Zoom in: In addition to being a challenging market for young buyers, potential buyers of color are being pushed further from D.C.
"There isn't a neighborhood in D.C. that isn't on fire," GCAAR president Jan Brito tells Axios of the city's competitive market. "The challenge however is affordability. Because as these areas become more developed, the folks that maybe grew up there are priced out."
- The District's non-Hispanic white population grew 25% from 2010 to 2020, which is the highest rate of the country's top 30 cities, according to the Wall Street Journal.
- In contrast, the non-Hispanic Black population fell 6% during that same time.
Be smart: Historically low interest rates are the cause of the housing market boom. But, in order to benefit from those low rates, buyers have to be competitive.
- Some are waiving inspection, appraisal, and financial contingencies, but not everyone has a budget large enough to make those kinds of concessions.
"Bring your patience," Brito advises aspiring buyers. "Some buyers may have to write several contracts before they win a bidding war. And then be as aggressive as you can comfortably be."
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