How Trump Transition May Affect Washington DC Real Estate Prices
Every time a new president gets elected to the Oval Office, many outside the Beltway would expect the real estate market in the Washington D.C. area to rise as staffers from the old regime depart and new arrivals for the next presidency arrive looking for housing in the area.
The reality is that this is rarely the case. A major reason for this is because an administration usually goes through constant turnover over the course of its four or eight years in command of the U.S. Executive Branch anyway. As a result, the heavy attrition rate of a presidential administration means that the D.C. real estate market remains fluid throughout an administration.
There isn’t much a bump when a new president arrives in town. Usually the bump may result in a one percent rise dating back to the 2012 presidential election. Aside from that slight increase, usually a major election doesn’t have much of an influence when it comes to a rise in the area housing market. In a way, that is a good thing for those new staffers who do enter the market as there won’t be a sharp rise in housing prices as well as an abundance of residential options.
That thinking could change with the impending arrival of the incoming Trump administration. While some think there will be little change in terms of the real estate market in the D.C. metro area, others aren’t so sure. As with the entire election process, the Trump presidency may end up flipping the script in the D.C. real estate market. This time, there could be a big rise in buyers (and possibly sellers) when it comes to finding homes in the area.
The Trump candidacy was unorthodox compared to regular routes to the presidency. Trump has had no prior political experience, but brings a wealth of experience in the business field. That means he could be bringing in a whole new cadre of administration members to the area instead of “political insiders” as the next staffers. Trump ran as a political “outsider”, so he may not have as many ties to staffers who could be termed as “Washington lifers.” The people that Trump could turn to in order to fill some thousands of staffing jobs for a new administration could well be from outside the Beltway.
In addition, given the heavy partisan attitudes generated from this election, there are could be a greater number of disgruntled Washington lifers who are choosing to leave rather than deal with charismatic, yet unpredictable Trump. The Democratic Party have had control of the Oval Office for the last eight years and may be ready to move away now that the Republicans are ready to assume control both houses of Congress and the Executive Branch.
They could be replaced not by the traditional Republican staffer, but by those with a more business-oriented background who don’t reside within the area. Trump may well turn to some more proven political staffers to help ease the transition from Wall Street to the Capitol. However, he ran on a platform that promised real change and that could also mean turning to non-D.C. staffers to fill up posts within his new administration.
Given that possible scenario, there remains a possibility that the D.C. real estate market could get flooded with first-time buyers coming in from outside the area in hopes of landing a staffing position with the new administration.
Those who do arrive may come into a more appealing real estate market that previously thought. For one, the Federal Reverse may not be raising interest rates in the short term, making it less costly over the long-run to buy a new residence in the U.S. in addition to the D.C. region.
So it is possible for a larger bump to the area market than previous elections have indicated. However, that doesn’t mean the entire market will be turned on its head or that even a large bump should be expected. That is partially because there are still only a few thousand jobs where there is potential turnover within the government following an election. Even if they are all going to be changed, that may still only affect the D.C. market as a whole by roughly five percent.
In truth, many of these jobs aren’t of the high-income variety either. Many are around $50,000 in terms of salary and that would actually be in the low-end or at the medium level for the D.C. market where the average median residential price would be north of $300,000.
There are still available options for family homes that feature multiple bedrooms and multiple baths in that neighborhood. An example would be this condo in the Congress Heights neighborhood which features three bedrooms, two baths, in a two-story setting and includes a basement.
Smaller options can include lofts small in square footage, but containing most of the necessities for living such as this opening along Columbia Road Northwest. Others may be interested in more living space and can opt for this older brick house along Talbert Terrace which comes at over $1,500 square feet, but with fewer amenities.
Then, there are those who may eyeing a newer house model with a more updated look. They aren’t worried so much about price, but are looking for a better neighborhood and location. A Quincy Street at Fourteenth new residence doesn’t have much footage and is a 2/2, but comes with a newer look, a garage, and a rooftop patio.
Regardless of what incoming staffers want, there shouldn’t be a crunch in the D.C. real estate market. Many incoming government employees under the Trump administration should find a good array of options. They should be able to pick and choose what their preference is in terms of location, safety, size, and available amenities.