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Rents Fall in NoMa, H Street and Upper NW

by UrbanTurf Staff

A year ago, news came that the DC area apartment market would swing from favoring the landlord to favoring the renter by the end of 2012. It now appears that projection is coming true, if just a little bit late.

A report out Wednesday from Delta Associates analyzing the regional apartment market in the first quarter of 2013 states that rents for Class A apartments in the city are up just 0.6 percent versus last year, and have dropped in sub-markets including NoMa/H Street (-1.4 percent) and Upper NW (-2.1 percent). To give these percentages some real meaning, Class A apartments in the NoMa/H Street sub-market now rent for $2,325 a month on average compared to $2,358 last year; in upper NW, apartments rent for $2,513 currently versus $2,567 in the first quarter of 2012. (The rents are a weighted average of all the units in the city.)

image
Courtesy of Delta Associates.

Here is a quick snapshot of average rents for Class A apartments in DC area sub-markets, as defined by Delta:

  • Central (Penn Quarter, Logan Circle, Dupont Circle, etc.): $2,780 a month
  • Upper Northwest: $2,513 a month
  • Columbia Heights/Shaw: $2,558 a month
  • NoMa/H Street: $2,325 a month
  • Capitol Riverfront: $2,280 a month
  • Rosslyn-Ballston Corridor: $2,324 a month
  • Alexandria: $1,889 a month
  • Bethesda: $2,579 a month

So why is this happening now? It basically boils down to a supply of new apartments and a pipeline that now seems oversized compared with demand. 16,300 apartment units will deliver in the DC area between Q2 2013 and Q1 2014 and another approximately 11,000 units will come online between Q2 2014 and Q1 2015. To put that number in perspective, normally 5,500 new apartment units are needed to satisfy demand in a given year.

The report released this week looked at Class A apartment projects. Next week, UrbanTurf will take a closer look at the state of the Class B market.

Definitions:

  • Class A apartments are typically large buildings built after 1991, with full amenity packages. Class B buildings are generally older buildings that have been renovated and/or have more limited amenity packages.

See other articles related to: renting in dc, renting, delta associates, dc apartments

This article originally published at http://dc.urbanturf.com/articles/blog/apartment_rents_fall_in_noma_h_street_and_upper_nw/6880

5 Comments

  1. mona said at 2:41 pm on Thursday April 4, 2013:

    Where do private home for sale and basement apartments fall in this category are they class A,B or not included

  1. Christopher Smith said at 3:17 pm on Thursday April 4, 2013:

    To put it in perspective, what is the size, no of BR’s and BA’s, class A or class B?

  1. JP said at 3:18 pm on Thursday April 4, 2013:

    This makes sense.  As more new apartment buildings come online in central DC, neighborhoods on the edge of the city will take the biggest hit. 

    While the amount of development in Noma is impressive, the developers could not have created a less interesting place to live and work. 

    With three other massive apartment projects in the works, it’s hard to believe that many of them won’t go bust or be converted to condos.

  1. Mark Wellborn said at 3:30 pm on Thursday April 4, 2013:

    Mona, From our understanding, they fall in to the Class B category.

    Christopher, this article covers Class A apartments. The rental rates are a weighted average of all the Class A units in the city.

    Mark Wellborn
    Editor

  1. Payton said at 6:22 am on Saturday April 6, 2013:

    Privately rented apartments, offices, and shops are typically not counted in these types of market surveys—only large buildings are. So the answer to Mona is “not included.”

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