Condominiums
Suburban Maryland condo buyers and sellers watched prices climb 18 percent last year. But across the Potomac, it was a different story. In Northern Virginia, median condo sales prices fell 1 percent. Likewise, D.C. condo prices dropped 4 percent.
Overall, the region's 19,430 condo sales showed a sobering 1 percent rise in median sales price, inching up more than $3,000 to $285,299. And 1,827 fewer units were sold in 2006 than in 2005.
"The condos for sale in Maryland are at a lower price point," said William Rich, vice president of Delta Associates, which analyzes condo and apartment prices in the mid-Atlantic region. "The District and Northern Virginia have seen such a large ramp-up in prices in 2004 and 2005 that they are now too high to sustain in the current market."
Condos in the District sold for a median $355,000 in 2006 and units in Northern Virginia had a median price of $305,000. In suburban Maryland, however, the median was just $250,000.
In response to falling sales, 13,000 new units were taken off the drawing board in 2006. Some projects halted completely, while others wereconverted to rentals rather than for-sale units, according to Delta. For example, a 520-unit condo near the planned baseball stadium was scrapped last year, while the 231 new units at the Alexan South Glebe in Arlington will be rentals instead of condos.
To lure buyers, new buildings are offering such incentives as no condo fees for a year. To get potential owners to even tour the units, other buildings are holding drawings for iPods and other in-demand tech gadgets.
In Virginia, the number of sales was down by 4,015 or 33 percent. No Northern Virginia county had an increase in sales.
"I think we've seen the worst of it, and sales are starting to move up, at least in the close-in areas of Northern Virginia," said Tom Meyer, president of Condo 1, a real estate brokerage and property management company in Falls Church. "The oversupply has dissipated. Either units have been taken off the market or sold in the last four months or so."
According to Jane Quill, president-elect of the Northern Virginia Association of Realtors, prices in recent years have escalated too quickly for buyers to catch up.
"I think the prices have been somewhat ridiculous, actually," she said. "Average growth over the last two decades or so has been 7 percent or so a year. When you jump into the double digits, that's not a good thing."
Condo sellers in Arlington County fared the worst in Northern Virginia, with the median price dropping $25,000, or 7 percent, to $350,000.
Meyer points to Arlington's Atrium condos as a case in point. The building has 115 identical, one-bedroom units. In May 2005, they were selling for about $400,000. But by December 2006, the average price was $320,000. However, since then, the prices have inched back up, he said.
In Fairfax County, with the biggest share of sales at 4,786, the median price fell 2 percent, to $304,900 from $310,000. About 2,500 fewer condos were sold in Fairfax County in 2006 than 2005.
Both the Loudoun and Prince William condo sales markets were flat, with median prices remaining at $300,000 and $270,000, respectively.
Alexandria was the only Northern Virginia jurisdiction with a rise in median in prices, from $295,000 to $301,133, or 2 percent.
In the District, 1,867 condos sold in 2006, 128 fewer than the year before. The median price, however, was $14,000 lower than in 2005.
Much as in Northern Virginia, overpricing and oversupply drove prices down, Quill said.
By contrast, prices in nearly all suburban Maryland counties soared in 2006, with Prince George's leading the way. There, the number of sales jumped to 2,937 from 2,064. Prices rose 34 percent, from a median of $145,000 to $195,000, but were still the lowest in the Washington metropolitan area.
Montgomery County condo prices rose 18 percent, with a median of $295,000. Sales increased from 3,099 to 4,231.
Just to the north, Howard County's sales followed a similar pattern, with a 19 percent increase in median price to $280,000. Last year, 868 units sold, 122 more than in 2005.
"We're seeing a market that can sustain luxury condos in Bethesda," said Dennis Melby, a real estate agent with Long & Foster's Bethesda office. "There are a lot of empty nesters who are downsizing."
He said, "Pricing is the key with condos. If you start from the price where the last unit actually sold, you have a much better chance of getting people to bid it up, rather than pricing the unit too high and having to reduce the price a number of times."
-- Barbara Ruben, Special to The Washington Post
Overall, the region's 19,430 condo sales showed a sobering 1 percent rise in median sales price, inching up more than $3,000 to $285,299. And 1,827 fewer units were sold in 2006 than in 2005.
Condos in the District sold for a median $355,000 in 2006 and units in Northern Virginia had a median price of $305,000. In suburban Maryland, however, the median was just $250,000.
In response to falling sales, 13,000 new units were taken off the drawing board in 2006. Some projects halted completely, while others wereconverted to rentals rather than for-sale units, according to Delta. For example, a 520-unit condo near the planned baseball stadium was scrapped last year, while the 231 new units at the Alexan South Glebe in Arlington will be rentals instead of condos.
To lure buyers, new buildings are offering such incentives as no condo fees for a year. To get potential owners to even tour the units, other buildings are holding drawings for iPods and other in-demand tech gadgets.
In Virginia, the number of sales was down by 4,015 or 33 percent. No Northern Virginia county had an increase in sales.
"I think we've seen the worst of it, and sales are starting to move up, at least in the close-in areas of Northern Virginia," said Tom Meyer, president of Condo 1, a real estate brokerage and property management company in Falls Church. "The oversupply has dissipated. Either units have been taken off the market or sold in the last four months or so."
According to Jane Quill, president-elect of the Northern Virginia Association of Realtors, prices in recent years have escalated too quickly for buyers to catch up.
"I think the prices have been somewhat ridiculous, actually," she said. "Average growth over the last two decades or so has been 7 percent or so a year. When you jump into the double digits, that's not a good thing."
Condo sellers in Arlington County fared the worst in Northern Virginia, with the median price dropping $25,000, or 7 percent, to $350,000.
Meyer points to Arlington's Atrium condos as a case in point. The building has 115 identical, one-bedroom units. In May 2005, they were selling for about $400,000. But by December 2006, the average price was $320,000. However, since then, the prices have inched back up, he said.
In Fairfax County, with the biggest share of sales at 4,786, the median price fell 2 percent, to $304,900 from $310,000. About 2,500 fewer condos were sold in Fairfax County in 2006 than 2005.
Both the Loudoun and Prince William condo sales markets were flat, with median prices remaining at $300,000 and $270,000, respectively.
Alexandria was the only Northern Virginia jurisdiction with a rise in median in prices, from $295,000 to $301,133, or 2 percent.
In the District, 1,867 condos sold in 2006, 128 fewer than the year before. The median price, however, was $14,000 lower than in 2005.
Much as in Northern Virginia, overpricing and oversupply drove prices down, Quill said.
By contrast, prices in nearly all suburban Maryland counties soared in 2006, with Prince George's leading the way. There, the number of sales jumped to 2,937 from 2,064. Prices rose 34 percent, from a median of $145,000 to $195,000, but were still the lowest in the Washington metropolitan area.
Montgomery County condo prices rose 18 percent, with a median of $295,000. Sales increased from 3,099 to 4,231.
Just to the north, Howard County's sales followed a similar pattern, with a 19 percent increase in median price to $280,000. Last year, 868 units sold, 122 more than in 2005.
"We're seeing a market that can sustain luxury condos in Bethesda," said Dennis Melby, a real estate agent with Long & Foster's Bethesda office. "There are a lot of empty nesters who are downsizing."
He said, "Pricing is the key with condos. If you start from the price where the last unit actually sold, you have a much better chance of getting people to bid it up, rather than pricing the unit too high and having to reduce the price a number of times."
-- Barbara Ruben, Special to The Washington Post
Housing Outlook 2007
The latest on the state of the Washington, D.C., residential real estate market.
How Much For That House?
What can you afford in today's market? We scan properties for sale in and around D.C.
SOURCE: Full-value transactions as reported by governments
MAP: Dan Keating and Nathaniel Vaughn Kelso - The Washington Post
© 2007 The Washington Post Company
