News

D.C. Area Condo Sales Up 34% in 2009
Washington Business Journal - January 7, 2010
by Sarah Krouse, Staff Reporter

Condominium sales in the Washington area jumped 34 percent in 2009 with a total of 2,350 units sold, fueled by the first time home buyer's tax credit, low interest rates and the creation of high paying jobs in the region.

Loudoun and Prince William counties led the area with 707 sales, followed by the District with 524 condo sales, according to Delta Associates year-end report.

There were 439 sales in Arlington and Alexandria, 273 units sold in Montgomery County and 202 condo sales in Fairfax County and Falls Church with an average sales pace of three units per month.

The surge in Washington area sales in 2009 brought the region's inventory-to-sale ratio, or the pace it would take to deplete the current supply of condos for sale, down to 2.6 years compared to 5.9 years at the end of 2008.

Arlington and Alexandria will likely be the first areas to see a pipeline shortage and, thus, a rise in prices with just a 1.4-year supply of new units. D.C. has a 1.8-year supply.

"You are already starting to see price traction in the Arlington and Alexandria submarket," said William Rich, vice president and director of the condominium practice at Delta Associates. "Pretty much all of the Northern Virginia communities have price increases."

Suburban Maryland, however, has not fared so well. Prince George's had a 22-year inventory-to-sale ratio at the end of 2009.

"There's not that much plpeline actively marketing in Prince George's but what's currently out there is moving slowly. Back in 2009 and 2008 the National Harbor was driving sales but the economy caused it to lose sales in the early part of 2009," Rich said.

Alexandria-based Delta's report said the Washington area has a year-end inventory of 6,071 units to sell, the lowest number since 2004.

Delta expects a net sales pace of 2,000 to 3,000 units per year in 2010 and 2011.

Condo project in the Washington area saw an average sales pace of 3 units per month, with 44 percent of all units sold by two local companies: McLean-based The Mayhood Company and Alexandria-based McWilliams Ballard.

Some projects such as Pulte's 530-unit Potomac Club in Woodbridge and The Bernstein Companies' 123-unit Waterfront Tower outperformed the average sales pace, selling about 18.6 units per month and 15.8 units per month, respectively.

William Rich, vice president and director of the condominium practice at Delta Associates attributed Potomac Club's success to lower prices and the first time home buyers credit. He said the Waterfront Tower project, which was an apartment-to-condo conversion benefited from previous residents who were interested in buying the renovated units.

The downside of the region's condo sales surge was falling prices. New condo prices were down an average 5.8 percent in the region at the end of 2009.

New condo prices dipped 3.7 percent in the district, slumped 6.2 percent in Northern Virginia and fell 6.9 in Suburban Maryland.

Median condo re-sale prices in the area were down an average 2.8 percent. Virginia saw a 5.9 percent increase in median condo re-sale prices and the District saw a slight 1.4 percent drop re-sale prices. Suburban Maryland experienced a dismal 13.5 percent drop in median condo resale prices.

There are currently 5,175 units planned in the region with sales scheduled to begin within the next 36 months.

In terms of new projects breaking ground, Rich said to expect apartment-to-condominium conversions, rather than new starts as long as credit markets are tied up.

A Successful Event at Woodmont Corner at Lionsgate!

www.LionsGateBethesda.com
SPEAKER: Stephen S. Fuller, Ph.D.
Professor of Public Policy, Center for Regional Analysis, Institute of Public Policy, George Mason University

Over 90 top real estate agents from the Maryland area enjoyed food, drink and a presentation by Dr. Stephen Fuller hosted by Lionsgate Condominium on the evening of Tuesday, September 19th. Dr. Fuller addressed the Washington Economy and Current Market Conditions. Thank you to everyone who was able to attend to make this event such a huge success!