Are Washington DC Apartments for Sale a Good Investment Opportunity?

Are you a new or experienced real estate investor? Are you looking for your next investment property to buy? How about investing in an apartment in the Washington DC real estate market? To see whether that’s a good real estate investment opportunity at the moment, continue reading.

Washington DC apartments for sale: What’s the housing market looking like?

So, what are Washington DC apartments for sale looking like in 2018? Simply said, the Washington DC real estate market is a great market with many investment opportunities. The job market is doing well, with both government jobs and growing businesses. It’s also a city with some of the nation’s best educational institutions, so students are constantly flowing into universities like American University (AU), The George Washington University, and George Mason University, among others.

Washington DC apartments for sale: Is it a buyer’s market or a seller’s market?

The Washington DC real estate market is currently a seller’s market. There’s high competition among property buyers which favors property sellers. So, if you’re looking for Washington DC apartments for sale, you need to plan quite well. Buying investment properties in a seller’s market is not impossible, but it takes more work than buying rental properties in a buyer’s market. Finding the right property becomes more difficult with a shorter supply and higher competition on buyers’ end.

Related: How to Buy an Investment Property in a Seller’s Market

Washington DC apartments for sale: Airbnb Washington DC

The nation’s capital attracted 22 million national and international visitors in 2016, and the numbers are continuing to grow at city records. DC is a cultural and entertainment hub. The annual Cherry Blossom Festival is right around the corner, and that’s just one of hundreds of other festivals which take place in the city and which attract thousands of tourists, especially around spring and summer. The Washington DC Airbnb market continues to grow as the city itself grows as a tourist destination.

In 2017 alone, Airbnb investors in Washington DC had revenues amounting to $84 million approximately. 5,600 guests rented Airbnb apartments for New Year’s alone. This is just a small indicator of how successful the home sharing service is in the nation’s capital.

Airbnb nationwide is witnessing a lot of controversy. Cities like New York City and San Francisco have seen quite fierce legal battles with the home sharing service. Most recently, Airbnb started to collect hotel taxes from Virginia hosts, but there are no news on developments in Airbnb Washington DC. The city’s Airbnb market is among the least controversial in the nation, so if you’re looking for Washington DC apartments for sale, definitely consider Airbnb Washington DC.

Related: Does Airbnb Washington DC Make for a Good Real Estate Investment?

Washington DC apartments for sale: Top Neighborhoods to Invest in

Washington DC is full of great neighborhoods to invest in, among the top neighborhoods for Washington DC apartments for sale are the following:

Penn Quarter

Located at the East End of Downtown, the neighborhood is a cultural and entertainment hub in DC. The neighborhood is known for its bars and restaurants, art galleries and museums, and festival areas, as well as theaters and arenas (like the Capital One Arena). An affordable option, Penn Quarter is a better traditional investment, but is still a successful Airbnb opportunity.

Median Home Price: $469,900

Average Rental Income per Month

• Airbnb: $1,772
• Traditional: $2,249

CoC Return

• Airbnb: 1.47%
• Traditional: 2.45%

Cap Rate

• Airbnb: 1.47%
• Traditional: 2.45%

Note: The reason cap rate and CoC return are the same value in the provided data is because Mashvisor’s calculations assume all cash payments are made (no mortgage).

NoMa

NoMa, named due to its location on the north of Massachusetts Avenue NE in DC, is a fast developing, up and coming neighborhood in the city. It’s also undergoing restorations in several of its areas. Its proximity to Union Station and Union Market make it a very successful Airbnb investment. NoMa is also on the more affordable end of DC neighborhoods.

Median Home Price: $567,400

Average Rental Income per Month

• Airbnb: $2,397
• Traditional: $2,305

CoC Return

• Airbnb: 1.05%
• Traditional: 1.91%

Cap Rate

• Airbnb: 1.05%
• Traditional: 1.91%

Capitol Hill

This neighborhood is among the biggest and oldest historic residential areas in DC. Capitol Hill refers to both the historic district and the larger residential area around the neighborhood. It’s also among the most densely populated neighborhoods in the city. It’s currently a center for a lot of government institutions and jobs “on the Hill”.

Median Home Price: $867,000

Average Rental Income per Month

• Airbnb: $3,563
• Traditional: $3,101

CoC Return

• Airbnb: 1.08%
• Traditional: 1.47%

Cap Rate

• Airbnb: 1.08%
• Traditional: 1.47%

Logan Circle

Logan Circle is another historic residential neighborhood in the city. It is the most densely populated neighborhood in Washington DC, and today remains entirely residential. Its proximity to downtown as well as many of the cities amenities makes it among the top choices for DC residents. Logan Circle continues to grow, and continues to undergo renovation.

Median Home Price: $699,900

Average Rental Income per Month

• Airbnb: $2,525
• Traditional: $3,498

CoC Return

• Airbnb: 1.43%
• Traditional: 3.01%

Cap Rate

• Airbnb: 1.43%
• Traditional: 3.01%

Foggy Bottom

Foggy Bottom is among the oldest neighborhoods in DC. The neighborhood coincides with most of the George Washington University campus, and is where much of GW’s students reside. That is to say, people will always look for Washington DC apartments for sale and rent in this neighborhood. Analyzing the neighborhoods data, one can also note how traditional investments amount for more profits in Foggy Bottom.

Median Home Price:  $849,000

Average Rental Income per Month

• Airbnb: $2,467
• Traditional: $3,474

CoC Return

• Airbnb: 1.67%
• Traditional: 1.81%

Cap Rate

• Airbnb: 1.67%
• Traditional: 1.81%

In conclusion…

Investing in the Capital is never a bad idea. Washington DC will always be a city that attracts job opportunities, tourists, and constant growth. For help on looking for Washington DC apartments for sale, make sure to use Mashvisor. Mashvisor’s investment analytical tools will help you find the right property, in the right place, at the right time. We provide real estate investors with data on different real estate indicators such as ROI, CoC return, cap rate, occupancy rate, expected rental return, optimal investment strategy, and the best neighborhoods in every city – all on one platform.

Related: Mashvisor: The Best Rental Property Calculator You Could Ask for