By james art 
5 bold forecasts for the Washington County
It was a difficult year for real estate. In the past year of 2024, higher mortgage interest rates were observed and in many markets in the United States, less buyers. We also tested a shift here in the DC subway. What happens now when the new year is here? Will there be more for sale? Here are Melissa’s 5 -lated DC Area Real Estate forecasts in 2025
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Buyers are back
I knew that would happen. Last year I told customers – this is the time to buy. It is difficult to convince people of this, as I have learned some things through my two+ decades in real estate (and in life.) People usually work with “today” thinking. They are hyperfocus for the present almost until the future is excluded.
That is why I knew it was time for buyers to come back. First, there are always soft spots in the real estate market in the DC area. These soft spots are August and December. The market is reset after these two months. As we did not see much recovery in September, after everyone finished their summer vacations, I expected it to come for us in Spring, ie. After the new year.
Second, every time there is a giant tupan that stops the speed of the real estate market – think on September 11, 2008, a residential accident or insidiousness, things stop. But they never stop long. The sharp increase in interest rates had time to determine “new normal” and it was time for buyers to return there.
When people ask what I think the spring market will be, I tell them I will find out on January 2. Why is January 2 so magical? I know people. And as a watch, people who want to buy homes decide to contact an agent on January 2. I received a few calls from potential new clients on January 2 this year and a call or two each next day in the first week of January. This is my barometer. This will be a busy season.
DC Real Estate will bounce
We all use the term “DC” when we mean the entire metro zone. But in this case, DC actually means DC. The city. Inside DC City.
What do I want to say that it will bounce back? In the last year, we have seen a dramatically reduced interest in the buyer in DC’s properties.
The neighborhoods that were “up and coming” slowed down due to increased crime. As I heard from another agent recently, which brought a buyer to one of my ads, “The third time her car stole, she knew it was time to move.”
E. There was that.
In 2023, the killings in the city struck a 20 -year peak, at 274. But in 2024, crime decreased in all categories. The killings dropped over 30%, robbery decreased by 40%and the attack with a dangerous weapon dropped by 27%.
How did the DC people react?
At the end of 2024, the mayor’s office released reports that DC has had the largest profit from the one-year population since 2013. The district added 15,000 inhabitants from July 2023 to July 2024. This is quite good, given that it puts the city over 700,000 marks for the population.
Administration changes will not change anything in the real estate
Everyone believes that there is a huge eviction of people who leave DC when the administration changes. This is not true. Here is a diagram to prove this. These are close sales, a decade returned a month. See the election – 2016, 2020 – Do you see any remnants during these years? No. They look like all the other years. So why do people believe in this? The short answer is “I don’t know.”
When a new administration comes with all new people, yes, some of them buy homes. But often the homes you hear about them are high dollar homes. That makes a great title, right? But for every $ 2 million home, which is bought by some high -ranking employee in the new administration, there are probably 25 homes that have not been purchased that you will not hear about.
Incoming people often leave a family behind them to another country and travel back -behind. They can buy a small drinking tere or can hire. Those in the administration who leave the office find work elsewhere. They not only take and leave DC because the administration has changed. There are many jobs here and they have many connections to provide one of these jobs. Leaving DC would really do nothing for them. They would have less prospects for work in most other cities. This way, the changes in the administration really do not change anything.
Back in the office
All these empty office buildings eventually had to return to life. Some have been turned into residential buildings, but other companies said, “It’s time to come back.”
Trump is no secret to the fact that he will return the people to the office. Every day. He also included Elon Musk to head the government efficiency, so this must be interesting. I love this name; This is the best oxymoron in the world. Initial reports were indicated that they would remove 100,000 jobs. Will this really happen? Nobody knows. The elections promise, as we all know, work in vacuum. These two cannot unilaterally reduce 100,000 jobs, but yes, there will probably be shakes.
What happens if 100,000 jobs are actually shortened? Many of these people will continue to find a job elsewhere. I do not worry about things until they happen and if they do, the subway area has enough opportunities to absorb these employees in other agencies or the private sector.
Different price points, different realities
I have had this conversation with probably a dozen different buyers in the last six months. When the interest rates were low, every price point was affected. Buyers for home and $ 200,000 buyers for $ 2 million homes rushed to click something to close the low interest rate in 30 years. When the mortgage rates increased over 7% over the past year, most people believe that the purchase activity will soften aboard. But, surprisingly, it didn’t.
Those in luxury price points were not affected. Luxury in the DC area used for $ 1 million or more, but now $ 1 million for a house can be a starting price for many buyers for the first time. Buyers at this price of $ 1 million – $ 1.4/$ 1.5 million were also the most intact. There was a little less competition. Instead of 5 home buyers, they may have been 2-3 buyers.
The largest changes happened at the price point of less than $ 600,000. When prices were 3%, there were 10 or 15 buyers for homes of $ 500,000 and $ 600,000. This is a price point for buyers for the first time for many buyers. When the rates increased, the number of buyers in these price points and the smaller ones went from maybe 10 buyers of the home, to without buyers or only one buyer. Interestingly, right? But why?
If you think, these are the price points for the entry level in this area. You can find homes in some areas for $ 300,000 and this is the same story there as the price of $ 500,000 to $ 600,000. The buyer of these homes has a tougher budget, usually less savings and something like a point or two in an increase in interest rates can take them out of the market immediately.
However, the good news is that for those who have remained, this is a sweet place right now! Will it remain that way? I expect the luxury market to continue full steam forward, business, as usual in 2025. I expect more buyers at the price point of less than $ 600,000 to start returning to the market, but I don’t know we will see them again by 2026 again D., when the mortgage rates are expected to descend again.
