In the last few years, Washington D.C has attracted many new residents with the changing landscape of the city. As more people look to move to D.C., the demand strongly outweighs the supply and the area’s desirability has yet to wane. The boom in the nation’s capital has partly been a result of it positioning itself as a tech hub. Companies such as Yelp, Everfi and a slew of others are swiftly moving in and creating jobs and developers have taken notice. The race to snatch up property and begin building has lead to the development of areas like The Wharf and West Half. Yet what can all this say for the luxury market?
“Demand came first and then developers caught on,” said Gretchen Koitz, Vice President at Compass and based in Maryland. “And as the empty nesters leave 5,000-square-foot houses in the suburbs, they don’t want a 950-square foot two-bedroom. They want something bigger, and that’s where the luxury development started.”
“[D.C.] is a smart investment because the population keeps growing, and there are only so many square feet in the city…”
The geographical limits that Washington D.C. faces poses unique obstacles and advantages to developers and the luxury market. Buildings mustn’t be higher than 13 stories to comply with the 1910 Height Act and as property becomes more scarce and the surge of new residents to D.C., investors have looked to the minute city as a hotbed for the emergence of luxury properties.
“[D.C.] is a smart investment because the population keeps growing, and there are only so many square feet in the city,” Koitz said. “The demand will continue to be higher than supply, and now we’re seeing that the number of international investors is continuing to increase.”
The city’s foreseeable future reveals no slowdown in the momentum of individuals seeking to call D.C. home as it has become a serious contender for Amazon’s second headquarters. CEO, Jeff Bezo’s acquisition of a mansion in popular Kalorama neighborhood has also done little to squelch rumors.
“The fast pace of change is going to continue,” Koitz said. “If it’s not a hole in the ground, it’s on the books.”
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