Washington, DC’s housing boom continues, with the District adding 4,682 units last year, second only to 2015 as the most active since the Census Bureau began tracking the figure in 1980, according to Greater Greater Washington.
Most of the housing growth in the Washington metropolitan area has occurred within DC proper. Multifamily permits outpace single-family permits in the region and the District. Overall, the recent influx of supply has helped to moderate rent growth there.
Whether the District can maintain the recent inventory growth is yet to be determined. Rents in the region are high to begin with, the report notes, and so if the pace of supply additions eases, rents could climb on par with those in the San Francisco Bay Area and Seattle. The report recommends more market-rate housing at all affordability levels in the region.
Robust population growth in the District is putting pressuring on housing supply and costs to buy and rent. Developers are responding by bringing more units online, and the GGR report suggests that those efforts are paying off for buyers by lowering rents, in particular.
The latest figures from the S&P Core Logic Case-Shiller U.S. National Home Price Index show that home prices in the nation's capital rose 3.7% in November compared to the same period a year earlier and were up 0.2% on the prior month. The average rental price, meanwhile, climbed 2.16% from the year-ago period to $2,828.98 in the second quarter of 2016, according to the Greater Capital Area Association of Realtors.
Areas of the city like the NoMa (North of Massachusetts Avenue) neighborhood have seen a noticeable uptick in building activity in recent months, particularly for high-end rental projects. Work recently started on a $100 million, 318-unit luxury scheme by Level 2 Development, Clark Enterprises and financing partner Federal Capital Partners.
Meanwhile, Skanska is at work around the corner on the first phase of the three-part, multi-building Tyber Place project that will offer 581,000 square feet of office space, 326 apartment units and 30,000 square feet of restaurants and retail when it is completed.
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