DC construction employment reaches 22-year high
There are many ways to gauge the relative health of a metro's housing market - home prices, average time on the market, the differences between asking and selling prices and so on. However, one metric that should not be overlooked is construction activity. A high and increasing rate of new building work, especially in the residential sector, is typically a good indicator of an improving local real estate sector. News, then, that construction is booming in the District could be a convincing sign that the values of the homes for sale in Washington, DC, are primed to continue their rise.
According to The Washington Post, employment levels for construction-industry workers reached a 22-year high in August. After steadily rising since the recession in the late 2000s, the sector now employs 14,300 people, which is 14 percent higher than from the same period of 2011, according to the source. Only four regions outperformed this pace.
Ken Simonson, chief economist for the Associated General, who carried out the study, said he believes that this increase in construction projects might be partially explained by the city's recent population surge. The region's relatively strong economy and attractive amenities has helped it become one of the country's fastest growing cities, according to recent census data, which shows that between April 2010 and June 2012, the District experienced a net gain of 16,000 new residents. In fact, this 2.7 percent increase means that more than half of the city's growth in the first decade of the 2000s came in that relatively small window.
This influx of new residents helps explain the construction explosion, according to Simonson. The demand for new single- and multi-family homes has increased significantly over the past few years, which has led to more construction projects in and around DC.
The population increase has also, unsurprisingly, led to a substantial uptick in the demand for apartments in the city. As more new residents seek apartments in the city, the inventory had dwindled and prices have soared, according to Affordable Housing Finance. The area's vacancy rate is plummeting and developers have started entering the market to scoop up available units, the source reports.
With apartment supply shrinking and prices rising, some new residents may want to consider buying one of the houses for sale in Washington, DC, instead. Unlike renting an apartment, purchasing a home can be viewed as a long-term investment, especially in a city as in demand as the District.