If you’ve taken a stroll lately through your favorite neighborhood or weekly real estate section, it’s likely you’ve come across more and more homes listed for $1 million or more. You’re not imagining things.
Home ownership in the DC market is an increasingly expensive proposition, but the million-dollar price point is especially in demand. (Actually, the sweet spot is $1-1.225 million.)
Urban Turf, a daily e-newsletter devoted to covering residential real estate in the nation’s capital, notes that as of April 2018, “28% of homes on the market were priced above $1 million.” And while that may seem like an impressive number, we’re only number eight in terms of million-dollar market share. San Jose, San Francisco, Los Angeles and NYC—among others—are all way ahead of us, according to Lending Tree.
What accounts for this development? It’s more than just “location, location, location; it’s time, money and lifestyle,” says Robert Hryniewicki of HRL Partners at Washington Fine Properties.
“No one wants to spend time sitting in traffic anymore. If they work in the city, they now want to live in the city. They want to walk to work, to school, to restaurants and retail attractions. They want to be close to metro. Urban neighborhoods that can deliver the amenities they’re looking for become more in demand. And the homes in these neighborhoods, already in short supply, appreciate accordingly.”
Whether they’re young families, older couples/individuals looking to “rightsize” their living quarters or new transplants from abroad or elsewhere in the US, all are drawn to what the District has to offer—from “vertical villages” (condo complexes with lifestyle-oriented retail like gourmet food markets and services like fitness studios and rooftop decks with pools and barbecues) in hip-and-happening zip codes (e.g. the Wharf) to gracious single-family homes in established neighborhoods with park-like settings (Cleveland Park, Kent) or historical charm (Georgetown).
Marjorie Dick Stuart, at Long & Foster | Christie’s International, cautions buyers to do their homework. “Educated buyers can recognize value. They know what to look for in terms of a home’s condition, size and potential. They know there’s limited supply and unlimited demand. If you’re looking in these neighborhoods, don’t be surprised if you can’t find something livable under $1 million.”
And while HGTV would have you believe that we’re a nation of renovators and DIYers, that’s not often the case. True, some home buyers can’t wait to wield a hammer (or call in a contractor). Others are less enamored. Again, busy Washingtonians don’t often have the time or mental bandwidth to manage extensive renovations. “They get overwhelmed,” adds Stuart, “and are willing to pay more for the bright shiny object that’s already move-in ready.”
Buying a home is like buying a dream. Yes, there are the hard decision factors like finances, but intangibles like neighborhood vibe also play a role. “We’re really catering to aspirations,” explains Nancy Taylor Bubes of Washington Fine Properties.
“We ask buyers to consider: ‘How does the house make you feel? Can you see yourself living here and getting involved in the community? Does the house speak to you?’ Then we work with sellers to present their homes in a way that appeals to buyers’ fantasies and, most importantly, justifies the price.”
In other words: staging—from reconfiguring layouts (open plan) and laying in new (bleached white) flooring to updating the kitchen and baths with new appliances (Viking, Sub-Zero), fixtures (Waterworks) and countertops (quartz is the new marble). All luxurious design elements that come at a cost.
Changing demographics mean a greater demand for high-end, high-design homes. Which can only mean one thing: even as we bemoan the lack of affordable housing, million-dollar-plus houses will become more commonplace.