Washington, DC, Multifamily Report – Spring 2019
Despite a boost in development, absorption has kept up pace and the occupancy rate in stabilized properties inched up 20 basis points year-over-year, to 95.3 percent.
Washington, D.C. rent evolution, click to enlarge
Mostly due to strong supply, Washington, D.C.’s multifamily market underperformed against U.S. averages for the better part of this cycle. However, the city’s solid job gains during last year’s second half have helped the metro’s rent gains rebound to 2.8 percent year-over-year. Although development powered through, absorption has kept up pace and the occupancy rate in stabilized properties inched up 20 basis points over 12 months, to 95.3 percent.
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The metro added 53,800 positions last year for a 1.9 percent expansion, with professional and business services (17,900 jobs) leading growth. Albeit incrementally, Amazon’s commitment to create 25,000 jobs in its National Landing HQ2 campus over the next decade is expected to strengthen both the area’s economy and real estate sector. Meanwhile, multibillion-dollar infrastructure developments such as the Silver Line expansion and the Purple Line light-rail project are moving forward.
Washington, D.C. sales volume and number of properties sold, click to enlarge
A total of $6 billion in multifamily assets traded for a new cycle peak in metro D.C. in 2018, while 11,277 units came online, marking another active year for the gateway market. With 12,229 units expected to be delivered and employment gains slated to remain healthy, supply and demand are bound to stay in relative balance, leading to a 1.3 percent rent growth in 2019.
