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“A buffet of new projects” keeps the current condo market hot, according to Delta Associates’ State of the Washington Metro Area Condominium Market Mid-Year 2004 report. Delta Associates has been conducting real estate research, as well as other consulting and data services since 1980.
During the first six months of 2004, there were 4,600 new condo units sold in the metro area compared to 4,400 units sold in all of 2003. Part of the increase can be attributed to the large number of “switch” projects, which are ones that started out as rental units and were switched to condominiums.
While single-family home transactions have risen 11 percent year-to-date, median condo prices are up 19 percent in the first half of the year, the Delta Associates’ report states. Condo prices also are rising for new projects, such as those near the Clarendon section of Arlington.
“The luxury condo market in this area is off the charts,” says Robert Montagne, president and CEO of Walnut Street Development, who is involved in a project called Clarendon1021. Along with Carlyle Realty Partners and Fountain Square Properties, Walnut Street Development is converting the 419 units that once were apartments into cool city dwellings.
The original building owner, Fairfield Residential, did it right, says Montagne, by tiering Clarendon1021’s top floors back for optimum cityscapes. A rooftop heated pool, hardwood-floored living areas, and stainless steel and granite kitchens make these spaces lifestyle choices for those who want to live, work and play in a centralized location. “You’re buying a lifestyle,” adds Montagne, who also has projects in Georgetown and Fairfax.
Clarendon1021’s recent preview party drew more than 4,000 guests, says Ross McWilliams, principal broker of McWilliams Ballard, who is handling sales for Clarendon1021. “It was incredible,” adds McWilliams. It’s a wonderful building with loads of amenities, such as a fitness center and a first floor lounge. The initial response to sales at this community, which is convenient to Metro and shopping, shows that there’s a short supply of new condominiums.
“The longer commuting times in this region are conducive to being closer to work,” McWilliams says. Besides younger buyers and empty nesters moving closer in, international buyers who are predisposed to multifamily living also are looking for urban spaces. And with interest rates low, it’s less expensive to own than rent, McWilliams adds.
Views also can play a part in this lifestyle choice. Take the sold-out Bromptons at Monument Place townhouses in Arlington developed by Smith Development Inc. The rooftop terraces offer a look at DC’s scenery, including historic skyscapes and monuments. These four-story wonders with elevators continue the elegant exterior theme established by another new building in front of it, says Kevin Smith, president of Smith Development. And inside, the developer’s taste for space comes through. Some units measure up to 5,700 square feet with exercise rooms on the ground floors and everyday gathering spots placed on the top floors for the best vistas.
“The condo market is here to stay, thanks to the shifts in lifestyle preferences, worsening traffic congestion, the aging baby-boomer demographic, and affordability issues in other forms of housing,” the Delta Associates’ report says. Short-term concerns include rising interest rates and overbuilding. But, according to Delta Associates, the mortgage rate increases will initially benefit the condo market because some buyers, who are priced out of the single-family home market, want to get in before increases hit. Plus, empty nester-oriented projects will be less susceptible to rising rates because the buyers of these higher-priced projects are less likely to borrow money for a home purchase.
City dwellings have a language all their own and conveniences, like nearby shopping, dining and Metro stops, to match.
