Among the many encouraging social and economic indicators from 2018, the November announcement of Amazon HQ2 in the heart of Arlington, Virginia positioned the Washington Metropolitan Area as a major focus in the national real estate conversation — a trend we expect to continue into 2019 and beyond.
While the infusion of additional technology jobs will be highly beneficial over the long term, the benefits to the region’s real estate marketplace are already emerging, with both Arlington and adjoining Alexandria having witnessed significant increases in new contracts following the announcement.
Indeed, Arlington experienced a 76.1% increase in new contracts in December 2018 versus the same period in 2017, followed by a 62.7% increase in Alexandria, sold dollar volume increased by approximately 33% in both jurisdictions. Furthermore, a significant drop in the number of active new listings suggests upward pressure on prices as we move into the first quarter of 2019.
Elsewhere across the region, 2018 delivered stable growth across most economic indicators, including a 1.1% increase in population, net international migration of approximately 43,000, and over 53,000 new jobs reported.
Of note, jobs in the Federal Government decreased by 3,600 in 2018 while federal procurement in the region increased to $82.6 Billion, the highest level in 10 years and a further signal that the region’s economic engine is fueled increasingly by the private sector.
More jobs and growth continue to strain the transportation infrastructure of the region, with almost 18% of the region’s workforce commuting over 60 minutes per day.
As with comparable metropolitan areas, transportation has a direct influence on the region’s real estate market, with submarkets proximate to job centers and transportation infrastructure continuing to outperform other submarkets in the region.
Of note, new contracts in Washington, D.C.’s Logan Circle and Thomas Circle neighborhoods increased over 33% in December 2018, mirroring the activity in Arlington and Alexandria.
Momentum is also tangible in Montgomery County, Maryland, where the median sold price increased 4.8% in 2018, while homes sold more rapidly with the average days on market decreasing 20.3%.
In close-in McLean, Virginia sold volume and prices edged upwards slightly. However, the number of new contracts more than doubled in December 2018 versus the same month in 2017.
In Annapolis, Maryland, the 2018 market showed signs of strength, with sold volume increasing 3.1% and median sales prices increasing 4.9%. Properties sold faster with average days on market decreasing 15.1%.
TTR Sotheby’s International Realty is a licensed real estate brokerage in Washington, D.C., Maryland, and Virginia.