For the last 18 months, reports have been coming out regarding the chronically low inventory of homes for sale in the DC area. It now appears that the supply is increasing, at least for one property segment.
The number of unsold condo units in new projects or those under construction (and not yet marketing) rose to 3,308 in the DC area by the end of 2013, an increase of 1,000 units from the third quarter when the new condo supply hit its lowest level in a decade. Additionally, 1,853 units are planned to start sales within the next 36 months. These numbers were published in a report out from real estate research firm Delta Associates on Monday.
Still, the inventory of new condo product varies greatly depending on sub-market. For example, in central and upper NW DC proper, there is a 4.2-month supply (and far less in certain neighborhoods), according to the report. However, in Arlington/Alexandra, there is about a 20-month supply, and in Prince George’s County close to a 50-month supply.
From the Delta report:
Most of the District remains supply-constrained over the short run; however, over the next 36 months, supply and demand is estimated to be in balance, while shortages are expected in the suburbs . We estimate that over 1,500 units will come to market during the next 36 months after taking into account attrition.
Following are a few more findings from the report:
- In 2005, the average number of units in a new or converting condo project was 93. Today, the average number of units in a new development has dropped to 41.
- The average effective price per square foot for new condo sales in the DC area rose by 5.7 percent in 2013, the strongest annual price growth since 2005.
- Delta Associates has identified 19 Class A 80-150-unit apartment projects that are under construction (a total of 1,948 units) that could convert to condos.
The rendering of the condo project pictured above is called 1055 High and will be located in Georgetown.
This article originally published at http://dc.urbanturf.com/articles/blog/new_condo_supply_in_dc_area_on_the_rise/7961
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