The push by federal government agencies, now at the direction of the Biden Administration, to aggressively bring employees back to the workplace impacts tens of thousands of federal government employees in the D.C. region who have been working remotely under pandemic-era loosened telework schedules.
Like their private-sector counterparts who found themselves able to work from anywhere during the pandemic, some D.C. area federal government employees relocated to larger homes or more affordable areas away from the District.
The migration trends began surfacing early in the pandemic in residential sales trends.
“Some of the places we saw the strongest market activity were out in the Fauquier County, Warren County and Winchester areas in Virginia, and we also saw Frederick County in Maryland, which actually had one of the fastest-paced housing markets in the country,” said Lisa Sturtevant, chief economist at mid-Atlantic listing service Bright MLS.
Those trends were driven by a wide swath of buyers with different backgrounds, presumably including teleworking government employees.
Many of those government workers may ultimately decide the longer commute is unsustainable, and moving back closer to the city and their agency facilities is necessary.
But they may not necessarily buy. The federal government provides good wages and benefits, but often can’t compete with private sector compensation. Federal employees who’ve grown accustomed to remote work may choose to keep the door open.
“They may be considering whether they want to begin to look for a job that will allow them to continue to work remotely. So as a result we may be looking at people who want to move into rental housing closer into D.C., allow them to be a little bit more mobile and to consider their options,” Sturtevant said.
If more remote workers, both government and private sector, in the D.C. area do begin returning closer to the city, it could put some strain on those far out suburbs that benefited from the remote work exodus.
“If the federal government goes back into the office in substantial numbers, we will see inventories rise in some of those further out markets and we’ll see home price growth ease and maybe even prices come down in some of those more distant suburbs where the markets were particularly hot during the pandemic,” Sturtevant said.
For those returning to D.C. and its more commute-manageable suburbs who intend to buy here again, they will add to the D.C. area housing market’s Catch-22 of more buyers than there are sellers to meet the demand.
