Housing in Georgetown is expensive: Current rates start at $175,000 for a studio apartment in Foxhall and reach $20 million for a mansion on Prospect Street. But that doesn’t necessarily mean it is selling well.
“The market is decent,” said Darrell Parsons, the managing broker of the Georgetown office of the real estate firm Long & Foster. “It’s not recovered yet, and it probably won’t for a couple of years at least.”
Parsons cites the recession as being a key cause in lower sales.
“There’s a lot of fear and anxiety about jobs. … The difficulty to get mortgage money is another thing,” Parsons said. “People are waiting for prices to hit bottom. The problem is that no one know when the bottom is until it passes.”
ark Wellborn, the editor of UrbanTurf, a blog about D.C. real estate, had a similar assessment. “Home sales will probably remain slower than they normally are, picking back up in late fall. A lot of it depends on how the economy is doing.”
Trends in the Georgetown real estate market are mixed. According to Wellborn, the number of homes sold this July was 25 percent lower than that of July 2009, but houses sold more quickly and for an average of 15 percent more.
The 25 percent drop in house sales in Georgetown was higher than an 18 percent drop citywide, but Wellborn said that this is not unusual, given Georgetown’s concentration of expensive homes.
“Getting a loan for a million-dollar home is harder than getting a loan for a $400,000 condo,” Wellborn said.
The recent economic crisis has taken its toll on the real estate industry as well as potential buyers. Long & Foster’s Georgetown office, which handles business throughout the Washington metro area, saw its monthly sales drop from $50 million before the crisis to $30 million today. As business dried up, one-fifth of the agents quit.
Despite this, Parsons said the company is still hopeful.
“Those who are still in the business are positive . and they understand that real estate goes through cycles. … They know that there’ll be a time when the market will improve.”
The Georgetown market has been particularly slow in the past few weeks, with only about three sales a week, but Parsons said he is not concerned.
“That’s not unusual for Georgetown because people tend to be away in August.”
Interest rates are still low, which Parsons said should encourage buyers not to wait.
“If interest rates start to go up, even if prices don’t, it’ll cost more to buy a house than if one had at a lower interest rate.”
All this uncertainty among homebuyers has had little impact on Georgetown students. Most landlords in the neighborhoods surrounding the university say that their rents have not changed through the recession.
“Prices have stayed the same for the last three or four years,” said Richard Huber, who manages several properties near campus.
“I rent out at about $950 [per month] per student. . The demand is definitely there.”
Cyrus Ariaban, another local landlord, agreed.
“The market is obviously volatile in the recession, but in Georgetown . prices have stayed the same.”