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Market Report

Washington, D.C. Multifamily Market Report

2024 Investment Forecast

New Rate Dynamic Gives the District a Favorable
Opportunity Cost for Renters, Defining Local Demand

Supply influx bolsters District affordability. Among major primary metros expecting over-2 percent stock growth this year, Washington, D.C. stands alone as the only market poised to record a vacancy decline. The continued strength of renter demand in the District will be vital to this trend. In 2019, the area’s top-tier average effective rent was $110 more per month than northern Virginia’s; however, as notable supply additions motivated greater concessions usage, the gap has closed to only $5 entering this year. At the same time, its discount relative to southern Maryland has also widened to a near-record of $340, supporting rental performance here. Despite the area hosting nearly one-half of the metro’s deliveries in 2023, its top-tier vacancy fell roughly 70 basis points, coinciding with the Class B rate holding steady. While the opening of 11,000 units here through 2025 may challenge multifamily metrics in the near-term, higher concessions usage from elevated supply should anchor renter demand for new units across District neighborhoods. Representing one of these, Navy Yard-Capitol South will host the arrival of 1,800 units this year. While its mean effective rent was the highest in the region entering 2024, these new builds will help dispel cost limitations for renters, lifting the local household count.
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