Rents Drop for the Second Consecutive Quarter in Washington, D.C.
Rents have been dropping in Washington, D.C., and in surprising neighborhoods.
Joe Banister reports that it wasn't necessarily a surprise that rents have dropped, given a large amount of new supply hitting the market this year, but there was still an element of surprise when analysis looked at "the submarkets where that rent drop was concentrated."
Banister is sharing analysis from Delta Associates, which found that "District-wide rents for Class-A apartment buildings decreased by 1.3% year-over-year to an average monthly rate of $2,585, according to research firm Delta Associates, and Class-B rents experienced a drop of 0.6%."
However, established multi-family neighborhoods with high rental prices and slow delivery of new supply also saw new rent decreases—submarkets like Columbia Heights/Shaw and Central D.C., which includes neighborhoods like Dupont Circle, Logan Circle, and Mount Vernon Triangle.
One the flip side of these decreased rents in slowly developing neighborhoods were increased rents in neighborhoods that saw an influx of new developments. According to Banister, "In the Capitol Hill/Capitol Riverfront/Southwest D.C. submarket, Class-A rents grew by 3.2% to an average of $2,410. That submarket absorbed 1,655 units during the 12 months ending Sept. 30, comprising nearly half of D.C.'s total absorption over that period."
Delta Associates President Will Rich is quoted in the article explaining the rent trends in D.C. as a result of shifting preferences among renters.