Forced in recent years to adjust to severe land shortages, Washington-area home builders have done surprisingly well this year.
Three-quarters of the way through 2005, sales of new homes were up 12 percent compared to last year. How was this possible, considering how hard it is to find land to build on?
In a word: condos.
Condominium sales have taken off in recent years, due to the rising cost of single-family homes and town homes, and to the lack of land to build those kinds of homes.
This year, sales of condos are up 63 percent in Fairfax County, 78 percent in the District, 214 percent in Alexandria and 1,327 percent in Montgomery County.
In Montgomery County, this sudden jump in condo construction has made up for a drop in single-family home sales. Overall, however, the market in Montgomery is still half of what it was five years ago.
Condo sales in the District pushed total new-home sales to 514 for the first nine months of the year. That might not sound like a lot, but that many new homes haven’t been sold in the District for at least 15 years.
Condominium sales have revived such land-scarce markets as Arlington and Alexandria, as well. Those markets are also having their best year in a long time, even though hardly any single-family homes have been built there all year.
This rise in new-home sales inside the Beltway has reversed a trend I’ve been observing since 1991. Back then, 54 percent of the region’s new-home sales occurred in the jurisdictions that touch the Beltway — Prince George’s, Montgomery, Fairfax, Arlington, Alexandria and the District.
Each year, their share of the new-homes pie grew smaller as home builders sought land farther and farther from the District. By 2004, only 37 percent of new-home sales happened in the region’s core communities, while Loudoun County and Prince William County led the nation in new-home sales.
This year, however, the trend has reversed for the first time in 14 years. Sales are down in Loudoun and Prince William, but condos have boosted sales figures inside the Beltway. Sales in those core jurisdictions now capture 38 percent of the region’s new-home sales.
Contact Chris Sicks by e-mail (email@example.com).
The metropolitan area includes the Maryland counties of Montgomery, Prince George’s, Anne Arundel, Howard, Charles and Frederick; the Virginia counties of Arlington, Fairfax, Loudoun, Prince William, Spotsylvania and Stafford; the city of Alexandria; and the District.