Close-in neighborhoods in the Northwest section of the District -- particularly those undergoing extensive renovation -- have been among the top places to invest local housing dollars in recent years, according to new neighborhood sales data.
Computations based on semi-annual price records for home transactions in District neighborhoods from January, 1975, through June, 1979, indicate that in percentage terms, the most rapid growth in real estate values has been in the "back-to-the-city" neighborhoods convenient to the core of the city or to transit lines.
The fastest increase for single-family dwellings, exclusive of condominiums and cooperatives, has occurred in the central-downtown assessment district, including the West End, lower Dupont Circle and environs. Prices there have increased an astronomical 244 percent during the past 3 1/2 years, from an average $56,000 to almost $193,000.
Foggy Bottom, portions of Capitol Hill, Mt. Pleasant, Columbia Heights, 16th Street Heights, Kalorama and Ledroit Park also rank among the top nine areas experiencing gains of 150 percent or more in average sales prices, with extensive rehabilitation, and proximity to downtown important factors.
Two D.C. neighborhoods that haven't seen a high degree of rehabilitation -- but which chalked up huge gains in average sales prices nonetheless -- are Observatory Circle (up 222 percent), and Forest Hills (up 141 percent). Both areas are astride major public transportation corridors to downtown-Massachusetts and Wisconsin avenues in the case of the former and Connecticut Avenue for the latter. Both neighborhoods are noted for traditional, High-quality dwellings. Forest Hills' percentage jump was enhanced as well by 1978-79 sales of newly constructed properties above $250,000, according to senior D.C. property assessor George B. Altoft.
The data for the rankings of D.C. neighborhoods by percentage increases in average sales prices come from city property assessment records. The average price movements are based on all recorded single home transactions in each area and they document neighborhood-wide patterns, not specific dwelling value increases. Some individual properties located in the central-downtown neighborhood, for example, may have declined in actual sales value during the last 42 months because of structural, maintenance or locational problems, despite the 244 percent increase for the average sales figure in the area as a whole.
Data for smaller neighborhoods, like Woodley and Massachusetts Avenue Heights, tend to be susceptible to sharp annual variations because of the impact of one or two high-priced (or unusually low-priced) dwelling sales among a total of only 8 or 10 transactions.
Neighborhood rankings bear no definite relationship to neighborhood housing costs or prestige, as evidenced by the presence of three areas with prices in the $200,000 range in the lowest seven on the list -- Woodley ($191,000). Wesley Heights ($196,000), and Berkeley ($200,077). Rather, the figures indicate that in relative percentage terms, the average sales prices recorded in these and other prime residential neighborhoods have lagged behind the city's mean, measured from a base year of 1975.
In some cases, like Wesley Heights, prices increased rapidly in the early 1970s, followed by several years of slower catch-up price patterns after 1975. Neighborhoods like Spring Valley (70 percent increase but 30 in rank) and Kent (up 95 percent; 23 in rank) registered large gains in dollar terms but their high average sales prices in the 1975 base year made their percentage gains more modest.
The average sales price in 1975 in Spring Valley, for example, was nearly $140,000, the highest in the city that year. Woodley was close behind at $134,000 and Kent was at $108,000.
The presence of neighborhoods like Mt. Pleasant, Columbia Heights, 16th Street Heights, far Capitol Hill and LeDroit Park among the top ten is partically attributable to converse price factors. These were among the lower cost areas in D.C. during the base year of 1975, and have benefited greatly from the urban rehab boom.
Mt. Pleasant, for instance, had an average price per dwelling of $36,000 in 1975, versus nearly $100,000 for the first six months of 1979. The dollar increases there have been well below those registered in some higher cost neighborhoods but the percentage change has been huge.
LeDroit Park houses had an average price of $20,770 in 1975; Columbia Heights dwellings went for an average $20,750, and 16th Street Heights for $38,800.
The Capitol Hill rankings show that the assessment office's neighborhoods beyond the central portion of the Hill-known as Old City 1 and 2-are registering high percentage gains because of renovation work, lower relative prices and speculative buying and selling. The central portion of the Hill near the Capitol complex, however, has shown remarkable jumps in the last 42 months, up from an average $65,960 per house to $135,250 this year.
Incidentally, Capitol Hill's several neighborhoods account for as much as 20 percent of the city's annual housing transactions.
:Kenneth R. Harney is executive editor of the Housing and Development Reporter, published by BNA, Inc., and author of "Beating Inflation With Real Estate," published by Random House.