Local condo buyers responded to a recent jump in mortgage rates, and lower home prices in some areas, by leaping into the market while there still was time to take advantage of historically low rates. Washington is one of three areas in the nation where housing prices have stabilized, according to recent data from the Case-Shiller indexes. Overall, sales remained sluggish in January, but the first weeks in February showed signs of improvement.
Real estate is all about location, location, location, and that is certainly true for condos. The metro area condo market varies by neighborhood and even by development with days on market decreasing in some popular enclaves. Units close to the District or near Metro stations and nightlife, are generally selling well.
“I’ve sold $3 million in condominiums this week,” said Tom Meyer, president of Condo 1 in Arlington. “It’s been a mediocre market for a long time, and there’s been an upswing in the last few weeks. Clients who have been keeping informed over the last several months have been calling to see properties immediately.”
In the Rosslyn-Ballston corridor, he said sales of entry-level one-bedrooms in the lower price ranges are coming back first, while the market for two-bedrooms still lags. Sales of Arlington condos priced in the $200,000 to $299,000 range increased by 12 percent in January over the same period last year.
Meyer said young professionals who want to be close to the nightlife are driving the market in areas like Arlington while empty nesters are moving closer in for the arts scene. He cited rents of $3,000 per month for a two-bedroom apartment in Clarendon as a factor influencing condo sales. Lofts, health clubs, and business centers are popular amenities, while pools have lost some of their appeal.
“People will be saying 10 years from now, ‘If only I had bought real estate in November 2010,’ ” said Meyer.
In the District proper, January sales increased by 7.5 percent over last year while the average price dipped from $425,000 to $382,000.
“In D.C., both the first-time homebuyer condo market is active, as is the higher-priced market for which the buyers are likely experienced homeowners,” said Suzanne des Marais, president of the D.C. Association of Realtors. “This group includes both buyers moving for more space, as well as those who are downsizing from fee simple homes.”
Looking at one- and two-bedroom condo sales in Northwest from 2009 to 2010, des Marais said properties are spending less time on the market.
One-bedrooms priced $301,000 to $400,000 went from 51 to 46 average days on market, with a drop in volume from 408 sales in 2009 to 378 in 2010. In the $400,000 to $500,000 range for one-bedrooms, the days on market (DOM) dropped from 74 in 2009 to 43 in 2010.
The two-bedroom market showed a DOM reduction in the under-$500,000 price point, from an average of 87 days to 62 days, as well as in the over $500,000 price point, which dropped from 91 days to 66 days.
The million-and-over market saw sales jump from 39 in 2009 to 50 sold in 2010, with only a slight decrease in DOM from 88 to 83.
U Street corridor, NOMA (the area north of Massachusetts also called Mount Vernon), Penn Quarter and Logan Circle are hot condo areas, as is Capitol Hill.
“Close-in, Metro-accessible locations are most desirable and command the highest pricing,” des Marais said.
January condo sales remained unchanged in Montgomery County, while prices dropped 16 percent. In Prince George’s County, condo sales were up 17 percent while average prices are down 22 percent.
“The condo market is very local,” said Joanne Darling, president of the Prince George’s County Association of Realtors. “Some condos are doing fine and some are not. The condo market in D.C. is doing well. Most condos in Bethesda and Rockville are doing well. Some in Greenbelt and College Park are faring well. It all depends on the individual development.”
Low prices and interest rates, reasonable condo fees and good news about the area market on a national level play a role in the decision to buy.
“The buyers are back out there again with more confidence, a lot more confidence,” said Coldwell Banker agent Lise Howe. “Though they’ve missed the window of the bargains, there’s a sense of energy coming back to the city. It’s picking up.”
