For many people in the market for a new home, there has been sticker shock when crunching the numbers. Interest rates have been among the factors driving up costs, so too has the demand for homes as people left condos during the pandemic.
Realtor John Coleman, with the Jason Martin Group in D.C., said for many people it was the rise in interest rates that not only made it difficult for homebuyers, but put many on the sidelines last year.
“It’s not a factor of whether or not people want to buy homes, it’s a fact of whether or not they can afford them,” Coleman said.
He said he believes the new year will bring change. Since the end of 2023, he said interest rates have come down some, and that has more buyers shopping once again.
“We’re going to start seeing more and more of what we saw during the early part of COVID, which is multiple offers happening at a high clip,” he said.
Buyers are left to decide whether to pay a little more now, he said, or wait for rates to dip more, which will bring about more competition over properties.
“I heard of something in Gainesville the other day having 30 offers on it and that just boggles my mind,” he said.
During the pandemic, many people — while stuck at home — decided to go bigger and, in some cases, move out of condos located closer to D.C.’s downtown. Now, some of those folks are feeling the pain of that decision.
“If you have to cross some bridges and deal with traffic and other areas, like traffic is going to start to be a driver of why people want to be back in the city if they have to go back to their offices,” he said.
With folks looking closer in, that doesn’t mean they are eyeing downtown condos. Instead, many of the closer in suburbs are seeing more activity.
“Alexandria is booming right now. We’re seeing multiple offers across the board,” he said.
When it comes to what people are looking for, he said, people still want space and are searching mostly for townhomes and single-family homes.
“Having a yard for your pup seems to be a pretty big deal for some folks,” Coleman said.
Condos are still moving, according to Coleman, but with inflation, he said many buyers are apprehensive about rising condo fees that must be paid on top of hefty mortgages.
While you shouldn’t expect a steal of a deal, Coleman said there are a few neighborhoods inside the Beltway and close to it that offer buyers more bang for their buck.
In Virginia, he said he’s “banging that Huntington drum,” since the neighborhood still has homes in the $400,000 and $500,000 range.
“They’re right on a metro line that ties directly into the Amazon campus over at National Landing. You’re a short Uber ride over to King Street,” Coleman said
He said bigger homes can be found along George Washington Parkway.
In Maryland, he recommends looking in Kensington, which he said has some more reasonably priced homes in an area that is close to D.C. and only a few minutes from North Bethesda’s Pike and Rose.
In D.C., Coleman said buyers should consider Shepherd Park when looking to get the most for their money. He said the neighborhood’s location between the Walter Reed development and Silver Spring gives residents “tons of commercial options” and the area also “has a very good neighborhood feel.”
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