Monday, October 22, 2007

DC Sales: August 2007

I've finished my analysis of full value residential sales the District recorded in August 2007. Coming on the heels of MRIS' September report, the information may be a bit anticlimactic as we wait in trepidation for October's data. I think the question everyone is asking is, is that a train headed our way?

As I mentioned earlier, I'm now restricting my analysis to condos and single family homes; I feel more confident in the analysis if I omit properties the District classifies as multifamily conversions. I know I'm excluding some that are legitimate single family homes, but I want to eliminate uncertainty.

All data has been uploaded for viewing on DCHomePrices.com and DCCondoPrices.com

State of the Market

In August 2007 the District recorded 711 residential sales, 9.89% less than the same month in 2006. Unit sales were almost evenly split between condos and homes while, in terms of dollar volume, homes led 60.05% vice 39.95%, both consistent with past months' results.

Viewing the data at a District level, four wards had a decent month in terms of pricing. Two wards experienced declines in average and median prices, one had lower average prices while another had lower median prices. All but two wards had lower sales volume.

Condo sales continue to dominate Wards 1 and 2. In Ward 1, 69.9% of sales were condos and in Ward 2, 84.28%.

Distribution of Sales

The chart below shows the distribution of August's recorded sales by sales price; 57.1% of recorded sales were priced $450,000 and lower.

Changes in the Market YoY

Average prices were up 6.01% in the aggregate; median prices were up 2.51%. Sales volume was lower for homes and condos, down almost 10% for each. Home prices appear to demonstrate the inverse of the old joke: what they lose on volume [fewer homes sold], they make up on sales [higher prices for homes].

Condos

The number of condos sold [existing and new] fell 9.93% YoY and prices were flat to negative. Sales in Wards 1 and 2 [Dupont Circle / Penn Quarter / Logan Circle] represented 56.75% of total condo sales, with 19.83% in Ward 1 and 36.91% in Ward 2 . A few condo buildings are still coming online as others sell their remaining inventory:

This article has a very interesting take on the condo market in Columbia Heights; Kenyon Square is discussed:

Two of the most visible high end projects steps away from the Metro are the Kenyon Square and Highland Park buildings, both developed by Donatelli Development, Inc. The Kenyon advertises to its desired clientele with a bright green sign reading “Scone. Newspaper. Starbucks. Less than 20 steps to the Metro.”

Kenyon Square has a total of 153 units with about 30 left – but the building isn’t finished yet. Highland Park which has yet to open, is only half sold – something that would have been unheard of in 2005.

According to local realtors, what’s hurting some of these new projects the most are contract cancellations coupled with excess inventory. A lot of buyers pulled out, according to Barry Smith of Domus Realty, who is handling marketing and sales of both the Kenyon and Highland Park. People who bought in at the beginning of the projects were planning to put down a deposit, ‘flip’ the property and sell the place after a couple of years hoping to make a generous profit.

“When the market leveled off and eventually declined...investors wanted to get out” Smith said, “and that 5 to 7 percent deposit was the best way to go... People said, ‘Keep my deposit, I don’t want the home anymore.’”

I'd thought sales from 1010 Mass would begin appearing in August's data, but that didn't happen. While driving by Chase Point condos today, I saw a PN Hoffman "open house" sign posted on Military Road. I saw an "Immediate Delivery" banner on The Sonata yesterday. I think there's blood in the water...

Single Family Homes

Although overall demand for single family housing is down 9.84%, higher average prices for all segments enabled positive growth in aggregate average and median prices. Average prices rose 11.5% and median prices were up a smidge more than 9%. Wards 3 and 4 accounted for 62.5% of detached home sales.

Purchase the Data

For $5.00, you can purchase a listing of the August home and condo sales recorded in the District discussed in this post. Information in the listing includes [see below]:

  • Address
  • Sale price and sale date
  • Unit number [if a condo and if available]
  • Price per square foot
  • Square footage
  • The number of bedrooms and baths for each unit


Note:
I use the District's downloadable data, which usually has a 6-12 month lag, meaning that the data doesn't include condos or homes completed within the past year. Data may not be available for all properties. My analysis is dependent upon the completeness and fidelity of the District's appraisal data.


August 2007 Sales Listings


Detailed Data

Aggregate by Zip Code

August 2007 average and median sales prices and unit volume by zip code.

Aggregate by Ward

August 2007 average and median sales prices and unit volume by ward.

Category by Zip Code


Category by Ward

Disclaimer:

  • Unlike MRIS, my data and analyses include new units [primarily condos] so there will be some differences in my conclusions about the market's state compared to a similar analysis based solely on MRIS reports, which only report sales of existing units sold and/or listed by real estate agents.
  • This analysis is of sales recorded by the District during the month as opposed to sales settled in the month, which is what MRIS reports, so there may be some discrepancies because of timing issues. However, I believe the data do provide a helpful indicator of trends in the District.
  • My analysis is based on District sales and appraisal data that I've collected and processed. I've deleted those sales that appear to be of questionable data quality. Errors are always possible.

6 comments:

Anonymous said...

Keith,

Do you have any statistics on the average condo sales per square foot in the district. I had some a while ago that showed that the price per square foot of condos had increased dramatically in only a few years, in all categories (luxury, mid-range, etc.). Prices have approached Manhattan levels in some cases, which is extremely unusual.

Price per square foot is a good measure since it helps you see what the builders are making since the costs have not increased all that much. It also helps put the big price changes in proper perspective.

condocritidc

Keith said...

Yes, I do. Check out the listings I sell for $5 - I provide $ / sq ft for all properties for which data is available. Yes, condo prices have risen dramatically, just like those for single family homes.

A cursory glance tells me that condos in DC go for $500-600/ sq ft, about double what a single family home costs.

I disagree that costs have not increased - builder costs have increased recently. Washington construction costs increased 5.7% YoY [see www.buildingteamforecast.com/
article/CA6483852.html].

Anonymous said...

Keith,

I had intended to say historical prices for condo sales per square foot.

condocritic

Keith said...

I've probably got the data to do this analysis. I'll put it on the list of things to do.

Deb said...

Keith,

If I am understanding your comment about the selection of "Types" of housing by which to exclusively report on.... and are excluding he residential conversions? Is that correct.?

Do you not think you are leaving out a large segment of condo information especially for someone who wants the "cndo" no maintenance etc, etc. but does ot like the "large "common" aspect of it.. As we (DMI) predominately develop that type of conversion because the product is much different from the standard condo box .

The conversions at least in our product give your condo buyer a completely different experience, and product thus price points cannot be comparative.

These buyers who want something other than the cookie cutter condo box, will be ale to accurately budget and research the row house conversions in a different light. (using your information)...If there is a choice .....actually as I am typing it is dawning on me... the only true difference from a single family two story home , and the row house conversion-( into the two two level "condo's") is that your neighbor is attached to you ... so perhaps I should consider the actual description and not call them condo's at all.. your thoughts?

Thanks

Keith said...

I use the classifications provided by the District.

Condos - as I report - are classified by the District as use codes 16, 17, 216, and 217.

I exclude use codes 24 and 25 [residential-conversion] because I don't know whether the sale is for a single family home or a multi-unit structure sold to an investor. If the latter, it distorts the analysis. In truth, these represent a relatively small percentage of sales in any given period.