Condominiums are often the most affordable option for first-time home buyers looking in urban markets such as the District, Bethesda, Md., and in Rosslyn, Ballston and Alexandria, Va. The good news, according to the Mid-Year Condo Report from Urban Pace, a real estate sales and marketing company, is that more large-scale condo projects are in the pipeline.
More supply in the two years could mean buyers will find more options and affordability.
The report found sales of new construction condos in the region’s urban markets were 30 percent higher in the first half of 2019 compared with the first half of 2018. This year, 856 new condos were sold from January through June, compared with 660 during that same period last year.
The market for new construction condos is strong and anticipated to get stronger in the Washington region, according to Urban Pace President Clint Mann. In recent years, much of the development in urban markets has been apartments rather than condos, particularly for larger buildings. Now condos are a large part of the mix of new development, and many appear to be more affordable.
The Mid-Year Condo Report found 45 percent of the units sold during the first half of 2019 were two-bedroom units, a reflection of the disproportionate number of luxury buildings with larger units that were completed in late 2018 and early 2019. However, the majority of condos that were under contract — but had not gone to closing — during the first six months of 2019 were for one-bedroom, studio or one-bedroom-and-den units in buildings that have yet to be completed.
While development of relatively more affordable new condos is anticipated to provide additional options for first-time buyers, Urban Pace’s analysis of the 15 most expensive submarkets over the past year for condos found Woodley Park in Northwest Washington topped the list. The median price-per-square-foot in Woodley Park was $1,235, driven mostly by JBG Smith’s Wardman Tower condo.
The West End in Northwest was the second most expensive at $1,071 per square foot, followed by the Southwest Waterfront submarket, where pricey condos in the Wharf pushed prices to $1,071 per square foot.
The least expensive markets include Reston, Va., where newly built condos sold for an average price per square foot of $421; followed by Bloomingdale in Northwest Washington at $429; Trinidad in Northeast at $493; Brookland in Northeast at $496; and Eckington in Northeast at $498.
New construction condos cost between 15 and 22 percent more than resale condos in most local markets, according to Urban Pace.