Washington D.C.-region Housing Market Outlook: Encouraging
By all accounts, the Washington D.C. region’s housing market is enjoying a particularly strong recovery.
As we move into the spring, I am greatly encouraged by the activity I have seen at The Peterson Company's residential projects. It’s a further sign that the market for residential real estate in parts of Northern Virginia and Southern Maryland seems to be improving, especially for those areas with good schools, easy access to employment centers and unique locations to offer.
I have no doubt that the constant negative news in the second half of 2011 put many buyers on the sidelines. Whether it was congressional gridlock, the downgrade of the U.S. credit rating by S&P, the European sovereign debt crisis, or a dismal stock market, Americans were pounded with reminders of just how bad things can get - hardly the environment for someone to think about purchasing a home.
This year already feels like a much different time for the market. The Peterson Companies and its residential team have already felt the difference at this early juncture.
At National Harbor, between Potomac Overlook and our three condominium buildings (One National Harbor, Fleet Street and Waterfront Street), we have registered more than 30 townhouse and condominium sales at average prices of over $500,000.
On the other side of the region in eastern Loudoun County, Autumn Oaks has generated nearly 30 sales from the late fall until now, and we are seeing come increased pricing at that project.
The new home market still faces many headwinds, including the effects of millions of underwater mortgages, a backlog of millions foreclosures and short sales, uncertainty surrounding the federal GSEs, and tepid economic growth and unemployment. However, with positive economic news becoming more common, such as stock market rebound and decreasing unemployment, I do believe a spike in buyer confidence is responsible for robust sales at a number of our projects.
Marginal locations will continue to suffer, as they certainly are still trying to shed an inventory overhang from the last building cycle. This condition will not abate anytime soon. In the meantime, let's hope 2012 will continue to show signs of a recovery in the for-sale housing market and the greater economy at large.