Buyers who are eager to become part of a resurgence in downtown living -- or at least profit from it -- are snapping up condos in the area around the new convention center, sometimes before the first bulldozer rolls onto a vacant lot.
By the time the building is finished 18 months or so down the road, some of these buyers will already be selling, and pocketing as much as a 25 percent profit, according to Steve Milkey, a Re/Max agent whose specialty is selling in downtown neighborhoods such as Shaw, Penn Quarter and Mount Vernon Square, all clustered around the new convention center.
Residences in Penn Quarter, such as these on Seventh Street NW between E and F, are gaining value partly from the new convention center nearby.
(Mark Finkenstaedt For The Washington Post)
"Where all the excitement is are the new neighborhoods popping up, replacing vacant lots and auto repair shops," he said.
A one-bedroom with den in these neighborhoods can go for upward of $525,000 today, an increase of $100,000 or more from just a year ago, he said.
That's far more than the median sales price of $325,000 for condominium and cooperative units across the District last year, as shown in statistics compiled by the Greater Capital Area Association of Realtors and Metropolitan Regional Information Systems Inc. The median is the point at which half the sales prices are higher and half lower.
Those numbers also show an astronomical price rise: In 1999, the median price was just $126,145. And condo sales are hot: While 2,723 condo and co-op units were sold in the District in 1999, 3,644 were snatched up in 2004.
Single-family houses, a category that includes townhouses, sold for more than condos last year (with a median price of $384,000), but they haven't appreciated quite as quickly as condos, for which prices have gone up 158 percent. The median single-family price has increased 113 percent since 1999, when it was $180,000.
According to Long & Foster agent Harry Moore, "listings for single-family houses are not as active as they were one or two years ago, probably because the prices have shot up so much. You can't get a house for under half a million nearly anywhere in the city."
Still, the large Tudor and Craftsman houses in the leafy neighborhood of Chevy Chase are moving quickly, often with multiple offers, he said.
Buyers looking for value are flocking to the Brookland neighborhood in Northeast, said Polly Driscoll, an agent with Weichert Realtors. With Catholic University and the Brookland-Catholic University Metro station on the Red line, the neighborhood offers a variety of early-20th-century single-family houses with easy access to downtown -- and prices hundreds of thousands cheaper than in tonier Northwest neighborhoods.
The skyrocketing District real estate prices are mirrored throughout the Washington region, with prices of both single-family houses and condos or co-ops doubling between 1999 and 2004 in most jurisdictions.
Montgomery County's median single-family house price rose from $199,900 in 1999 to $392,000 in 2004, while houses in Prince George's County rose in value from $140,000 in 2000 to $240,000 last year. Southern Maryland's prices rose more slowly; for example, the median home price in Charles County rose from $141,911 in 1999 to $250,000 in 2004.
Across the Potomac, many Virginia jurisdictions saw prices rise just as fast. Between 1999 and 2004, the median price for a single-family house in Alexandria shot up from $240,000 to $515,000, while the median price in Arlington jumped from $259,000 to $550,000. In Fairfax County, the median house price nearly doubled, from $215,000 to $425,700, while in Loudoun County it rose from $198,000 to $409,940. In Loudoun, one of the fastest-growing counties in the country, the number of houses sold more than doubled in five years, from 3,545 in 1999 to 7,421 in 2004.
"There are more neighborhoods in the D.C. area that are hot than not," Moore said in explaining the continued rise in home prices. Although sales have slowed minimally in some areas in the past year or two, others are still picking up steam, he said.