- Mike Ochs
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Washington, D.C., Housing Market Shines in a Bleak Landscape
Although the Washington, D.C., residential market has held up surprisingly well over the past few years in an environment hammered by unemployment and foreclosures, there is a question of whether the nation’s capital will spur recovery or if the rest of the country will drag down the local market. Washington’s relatively low unemployment rate and availability of well-paying jobs has helped cushion the city’s housing market. During the 3rd quarter, the District of Columbia’s average home price rose 3.1 percent over the 2nd quarter to $410,839, according to Delta Associates, a real estate research firm. That is 6.2 percent higher than average home prices during the 3rd quarter of 2009. The region’s foreclosure rate as of September was 2.1 percent, according to CoreLogic. Nationally, the foreclosure rate was 3.3 percent.
According to Mark Zandi, chief economist at Moody’s Analytics, more than 4 million homes were in or near foreclosure nationally in 2010. That’s over and above the 6.2 million homes that were foreclosed between 2007 and 2010. Those 10.2 million foreclosures equal the combined populations of Vermont and North Carolina. Approximately 57 percent of economists and real estate experts surveyed by Macro Markets don’t think that home prices will recover until 2012; another 35 percent believe that real recovery won’t happen until 2013.
In recent testimony before the Congressional Oversight Panel, Treasury Secretary Timothy Geithner said that 24 percent of homes in the United States are under water – which puts their owners in the unenviable position of being unable to refinance or sell. “The most important thing that’s going to affect the trajectory of home prices, the overall number of foreclosures, the ability of people to stay in their homes, is what the government is able to do to get the unemployment rate down,” Geithner said.