To Rent or Sale? Part 2 - Washington, DC

Yesterday, I wrote about the 2008 rental market in Montgomery County, MD, to try and get a handle on whether it’s easier to rent a property in this declining real estate market than to sell it. I offered statistics, but very few conclusions.

Today, I’ll include the statistics for the 2008 Washington, DC rental market, which generally look very similar percentage wise to the Montgomery County figures.

In 2008, 1823 properties were rented in the District ranging form a one bedroom, one bath condo in Southeast, which rented for $500 a month, to a 5 bedroom, 5 full bath, 2 half bath estate in Kent that rented for $15,000 a month. In addition, 67 properties have rental applications pending.

Currently, 594 properties are on the market in DC. They range from at 2 bedroom condo in Anacostia for $475 a month to a 6 bedroom, 8 full bath, 2 half bath estate in Spring Valley, which is listed for a monthly rental of $35,000. It’s also listed for sale for $9.5 million, and has been on the market for two years.

(I want to make note that these statistics are probably less accurate than the Montgomery County rental statistics because I’ve only included the properties that are listed through our multiple listing service, MRIS. There are many buildings in DC that rent without going through the MLS, and most of my clients in the past have found it easy to rent their own properties through various bulletin boards and Craigslist. However, that seems to be changing. The reason I’ve done this research is because one of my clients has been having a hard time trying to rent his row house in the U St. area on his own and has now listed it through me.)

But if you look at the rental stats overall for Montgomery County and DC, the percentages are about the same – a 3 month rental absorption rate in Montgomery County compared to a 4 month rate in DC.

The more disconcerting figure from the DC stats is that 1319 properties were withdrawn or expired without being rented in DC, a number equal to 72% of what was actually rented. (That compares to 2284 in Montgomery County, a little less than 50% of what was rented.) I’m hoping that if I dissect that number further, I would find that many of those properties had been listed both for rent and for sale, and eventually sold.

In 2008, 5464 properties sold in DC, almost equally divided between condos (2640) and single family homes (2824).