Wednesday, January 31, 2007

Analysis: DC October Sales

I know, it's January and I'm just getting around to posting data about October home and condo sales in DC. Blame the delay on two things: DC didn't post the data until December and the holidays got in the way.

Unlike the MRIS data I've been posting, my analysis includes sales of new and existing homes and condos in DC. Since I'm using data posted by the city, understand that the chances for error do exist although I've done my best to clean and correct the data [one house in zip code 20011 was recorded as having been sold for more than $56M; I think not].

Among the new units with sales recorded in October are:

  • 1133 14th St NW (Alta at Thomas Circle): 26 units
  • 2425 L St NW (Columbia Residences): 35 units
  • 1413 P St NW (Cooper Lewis): 3 units
  • 1125 12th St NW: 5 units
  • 2120 Vermont NW (Rhapsody): 10 units
  • 4101 Albemarle St NW (Cityline): 3 units
  • 2501 Wisconsin NW (Georgetown Heights): 5 units
  • 1451 Belmont St NW (Fedora) : 7 units
  • 2750 14th St NW (Lofts of Columbia Heights): 6 units
  • 1438 Columbia Rd NW (Piedmont): 6 units
  • 1348 Euclid St NW (Verona Parc): 9 units
  • 3900 D St SE: 5 units
  • 2850 Hartford St SE (Hartford Square): 4 units
  • 2472 Alabama Ave SE: 12 units

Highlights of October 2006 sales compared to October 2005:

All metrics are lower YoY, in line with MRIS' data. Condos maintain their 50%+ share of the DC housing market.

Detailed home and condo sales data

City-wide average and median sales prices and sales volume by zipcode:

City-wide average and median sales prices and sales volume by type of housing by zipcode:



Saturday, January 20, 2007

Dark windows: 555 Massachusetts

When I moved back to DC in late 2003 and started looking for a place to live, the Sovereign Square Apartments at 555 Massachusetts was one apartment complex I considered. However, my better half nixed the idea. Taking advantage of the real estate boom, the builder, JBG Properties, decided to convert the building to condos, branding it as "5 Fifty Five". Quoting DCLofts.com:

Formerly built in 2004 as Sovereign Square apartments, this is a 14-story building with 246 condominium units originally priced for purchase from the upper $200's for studios. Units feature granite kitchen countertops, choice of black-on-black or stainless steel appliances, ceramic tiled foyers, Berber carpeting or hardwood flooring, and full-sized washer and dryer in every unit. There is a roof-top pool and deck that has city views.

According to my database of 2005/2006 sales, 162 units have been sold through October 31, 2006, excluding three flip sales. Average price: $417K; median price: $406.9K.

More than 80 units, fully 1/3 of the building, remain unsold.

Tuesday, January 16, 2007

NY Times: DC Condo Market Has Collapsed

An interesting article in today's NY Times. According to the reporter, condo developers in DC and other cities are either converting their projects to apartments or are cancelling them altogether.

Since the middle of 2006, the frenzied condominium market here [DC] and in several other big cities like Las Vegas, Miami and Boston has collapsed. Once roaring sales have slowed to a trickle, sparse inventory has mushroomed into a glut and soaring prices have flattened out and started falling.

The graphic accompanying the story depicts the same trend I've been seeing as I collect data for DCHomePrices.com: significantly lower volume in 2006 compared to 2005. However, it also shows the dramatic growth in unsold inventory.

One effect we may see as a result of this sudden glut of new apartments is lower rents in the DC metro area.

Industry analysts also point out that rents may start sagging if too many condos are converted into apartments too quickly. While rents were rising at a robust 6.1 percent annual pace in the Washington area late last year, according to the Bureau of Labor Statistics, some buildings in the suburbs have recently started promoting move-in specials and other incentives to lure renters.

Sunday, January 14, 2007

MRIS December Housing Report: The market decline continues

MRIS' report on sales of existing homes in DC in December is out.

Highlights of the report (comparing YoY data):

  • Dollar sales volume: -25.89%
  • Average sales price: -13.04%
  • Median price: -2.94%
  • Days on market: +91.67%
  • Total units sold: -14.78%
  • Average list price for solds: -11.44%

The trend first reported in November continues: fewer homes are selling, both average and median prices continue to decline, and time on market continues to rise.

The average sales price for condos was $396,716. For condos in DC YoY, average sales prices declined 7.89%, dollar sales volume fell 21.16%, and sales volume declined 14.41%. My operating assumption this year, first posited when I reported MRIS' November data, has been given the fact that condos represent such a large share of the District's housing market (51.01% of all units sold in November), the severity of the downturn in the sales of existing detached and semi-detached housing units has been masked and is actually worse than reported by MRIS. When condos are excluded, we see that the statistics are worse:

  • Dollar sales volume: -28.74%
  • Average sales price: -16%
  • Total units sold: -15.16%

Extracting condos from the data reported by MRIS, the average sales price of a home in DC for December 2006 was $619,365 versus $737,367 in December 2005.

On another topic, October's recorded home sales in DC have been uploaded to DCHomePrices.com.

Sunday, January 07, 2007

Phantom housing rebound?

Interesting article in today's NY Times. Essentially, housing sales data reported by the Census Bureau may actually be overstated by 150,000 to 200,000 homes. Worse, homes which have had their sales contracts cancelled are not added to the inventory, resulting in underreporting of housing inventories. The market is in worse condition than the reported data indicates.

For the figures on new-home sales have a strange wrinkle that, in the current environment, may lead the government to overstate sales (and to understate inventory) by up to 20 percent. “The market is weaker than the data say,” said Mark Zandi, chief economist at Moody’s/Economy.com.

New-home sales are tallied by the Census Bureau, based on a sampling of contracts signed by home buyers. Running at a pace of more than one million a year for the last four years, new-home sales have been a significant contributor to the housing boom — and to the economy. (Existing-home sales, reported monthly by the National Association of Realtors, count actual closings.)

But here’s the rub: If a contract to buy a home, signed in November, is canceled in December, the Census Bureau does not subtract the failed transaction from the number of sales, or add the house back to its inventory total. In the last year, as the housing market has cooled, the volume of cancellations has risen to epidemic proportions.

...

New homes on which contracts are not consummated are not added back into the inventory figure. The most recent report found that the seasonally adjusted estimate of new houses for sale at the end of November was 545,000, or 6.3 months of supply. Given the high rate of cancellations, it’s likely that inventory is substantially higher."