Since the pandemic began, the real estate market has been booming, and Washington DC is no exception. At one point in 2021, the city's median home selling price was $500,000.
So, what does this mean for real estate investing around Washington DC in 2022? This is a quick guide to property investing there.
Due to Washington DC being such a popular city to work in with well-paying jobs, the cost of living tends to be high in that city. In 2020, they ranked among the top ten most expensive cities in America regarding rent.
The city tied for sixth in the country with Los Angeles, averaging around $2,260 per month.
What this means for landlords and property owners is that compared to most cities in the country, with the exception of places like New York City, Boston, and San Francisco, you can charge more rent in this area than anywhere else in the country.
Part of the reason why the rent and median home prices are so high is that there is not enough supply to match the demand in this area.
Home supply fell by 23% from 2020 to 2021, and that impacted the amount of time it took to sell those properties. Washington DC had the highest percentage of homes sold in under 14 days in the country at 65%.
With more demand, buyers became more competitive in terms of trying to land a house, and it clearly saw a nice benefit for the sellers. More than half of the homes on the market in the DC area sold above the asking price. The average actual selling price compared to the listing price was +2.6%.
Instead of having to negotiate with buyers, the buyers were bending over backward trying to buy a house from the seller, which resulted in consistently getting more than they originally asked for.
It is no secret that Washington DC typically has people who make a good living. The median income level in the area reflects this, with it being just over $92,000 at the end of 2019.
Considering that this is higher than the national income, people will have a little more money around here to buy themselves a nice home. Plus, Washington DC is a place that likes to hire many lawyers and people who work in the political realm.
Those jobs do not go away so easily, so you can expect the median income level to remain consistent enough in this area for people to be able to afford quality housing.
Read More About Real Estate Investing
These are some things that you need to keep in mind when it comes to real estate investing in the Washington DC area. It is a place that is certainly trending upwards and will likely not suffer too much in median income in the near future.
Do you want to get involved? Contact us today for any assistance with property management.