DC Area Housing Statistics

Overview

Washington, DC is currently facing an affordable housing crisis.  Rental costs and the sale prices of homes have both skyrocketed in recent years, and the affordability gap continues to grow. Over 1/3 of households in the district suffer from an inordinate housing cost burden.  However, by selling homes at subsidized prices with no-interest, no-profit mortgages DC Habitat for Humanity (DCHFH) is able to help low income families achieve the dream of homeownership.  In many cases these families end up paying less per month for their DCHFH mortgage as they previously did for rent.

The increase in demand has also resulted in a tremendous increase in the production of housing. There were more than 1,900 new units permitted in 2004, 50 percent above the 2001-2003 average and more than six times the average of the 1990s. In late 2005, an astonishing 8,900 housing units were under construction or about to break ground in the city—the biggest building boom in Washington since the early 1960s.

How has this building boom impacted affordability? In 2001, 34 percent of the District’s for-sale housing would have been affordable to a family supported by a full-time school teacher.  By 2004, that figure had dropped to just 16 percent.

Rental Costs

In the rental market, the costs are high and continue to climb.  The Fair Market Rent (FMR) for a two bedroom apartment was $1,187 in 2005, up 31% from 2001 [i], but advertised rents were substantially higher.  The average advertised rent for a two bedroom apartment in fall of 2003 was $1,750 per month, up 84% from fall of 2001, and nearly 50% higher than the 2003 FMR [ii]. This illustrates the fact that in many cases people moving into an apartment pay substantially higher rents on average than people who continue to rent the same apartment they lived in the previous year.  While there is little data available, regional statistics and FMR rent trends suggest that the advertised rents in the District of Columbia continue to rise.

As prices have risen, the percentage of residents able to comfortably afford a median priced apartment has dropped causing the affordability gap to grow 33% from 2000 to 2004.  In 2004, there were 20,000 more low-income families in DC than there were affordable rental units [iii]. In fact, 44% of all renter households, at any income level, had inordinate housing cost burdens in 2004 [iv].

Home Purchase Costs

The challenges surrounding affordable housing are not unique to renters.  The number of affordable houses, defined as those assessed at $150,000 or less, continues to fall.  In 2004, there were only 16,600 affordable homeownership units in DC, 36% less than the previous year [v]. Families looking to buy an affordable home in Washington DC face a daunting task.  Between 2000 and 2005, the median sales price for a single-family home in the District rose 174 percent, from $178,250 to $489,000. Condominiums and cooperatives, once considered “starter” homes for first time buyers, have increased equally from a median sales price of $138,000 in 2000 to $377,950 in 2005.

Citywide, the median price of single-family homes and townhouses reached $384,000 in 2004 [vi].  This has likely risen in the past year, considering the median sales price for the Washington Metropolitan Area rose 26% in 2005, to $441,400 [vii].

DC Habitat Homes Compared to the Market

DCHFH sells our homes for $99,000 with a 25 year no-interest, no-profit mortgage.  This keeps monthly mortgage payments under $450.  This is approximately ¼ of the median price of a single-family home in DC, and effectively less because we do not charge interest on the mortgage.  While the median value of homes in Deanwood, the neighborhood we are building in, is only $138,000 [viii], far below the city’s average, this is still nearly 40% higher than the sales price of a DC Habitat home.

Our monthly mortgage payments also compare favorably with the rental market in DC, and many DCHFH homebuyers actually pay less for their mortgage than they did in monthly rent.  The 2006 Fair Market Rent (FMR) for a comparable unit (3 bedrooms) is $1,580 [ix].  This means DCHFH’s mortgage payments are just 28% of the FMR.  The comparison of rent to mortgage payments is important because virtually all of DCHFH’s program participants are first-time homebuyers.

How can you help?

Please follow these links to learn how to donate or volunteer with DC Habitat for Humanity.

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