This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!
Question: I have heard mixed opinions on whether single-family homes appreciate faster than townhouses and condos. Do you have any data that addresses this?
Answer: On an aggregate level in Arlington, single-family detached homes appreciate faster than townhouses, which appreciate faster than condos.
Over the last ten years the median single-family home has increased from a median purchase price of $630,000 to $850,000 (35% increase), the median price of a townhouse has increased from $542,000 to $696,500 (28.5% increase) and, condos have increased from $350,000 to $392,000 (12% increase).
Below is the chart for median purchase price, broken out by housing type, in Arlington over the last ten years:
- One may assume that the appreciation of single-family homes over the last five years is mostly attributed to so many old, less expensive homes being replaced by expensive new homes. However, by using median price instead of averages, we know that the appreciation exists across the entire single-family market. In fact, the appreciation in average price is less than the median suggesting there’s stronger appreciation in the middle of the market than at the top or bottom.
- As with any asset class, growth is directly correlated to risk and the historical appreciation of each housing type is reflective of the risk of ownership. Condo owners benefit from much more predictable and relatively low repair/replacement costs (mostly bundled into condo fees) than single-family owners who are responsible for anything that happens on their property (e.g. basement springs a leak and water line breaks in 6 months, you’re on the hook for tens of thousands without notice). You also tend to find condos centered around metros and dense office/retail centers which stabilizes market value during down years.
- Scarcity also plays a role in the higher appreciation of single-family homes in that it is much easier to introduce a new supply of hundreds or thousands of condos (and rental apartments) into Arlington than it is new single-family homes or townhouses.
- The above chart aggregates all homes in Arlington within each housing type, but it’s not hard to find sub-markets within each housing type that offer better or worse historical appreciation. For example, In December 2017 I ran an analysis on appreciation of condos built from 2000-2008 and found growth of 13% and 20% for one and two bedroom units, respectively, from 2010-2017. The conclusion? There are good deals and bad deals all over the market, so don’t rely on a single chart or data point.
I hope everybody had a great Fourth of July!
If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.
Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.
Robbery at Pentagon City Mall — “1000 block of S. Hayes Street. At approximately 3:39 p.m. on November 22, police were dispatched to the report of a larceny just occurred….
An Arlington man is behind bars after police say he shot someone in the Green Valley neighborhood. The shooting happened early Sunday morning following what police described as a dispute…
Everyone has flat screen TVs already so how about a more interesting Black Friday special? The ARLnow Press Club for free, to try out the daily Early Morning Notes email…
There’s not a whole lot going on in Arlington today, save for activity at local shopping centers, so we’re going to fast forward right to the top story countdown. Here…
The Optimist Club of Arlington is holding its 76th annual Christmas tree sale!
This year, the tree sale will be held at the Knights of Columbus (5115 Little Falls Road). The lot opens for sales on November 25th. The Optimist Club is selling small and large trees ranging from tabletop size to huge 14 foot tall trees! Wreaths, garlands, tree stands, and White House Christmas ornaments will also be for sale.
100% of all proceeds go towards helping Arlington County youth.
For more information, please visit the Arlington Optimists website at https://optimistclubofarlingtonva.org/.
Art House 7 is a small art studio in Arlington – offering instruction in painting, ceramics, sewing and more. We are looking for kind, dedicated people who love both creating and teaching.
Ceramic Teachers are needed to teach wheel-throwing to adults and 6-12th graders and to teach hand building to elementary grades. Classes have 3-8 students.
Drawing teachers are needed to teach either kids or adults. For kids, we offer cartooning, manga or traditional drawing. For adults, we only offer traditional drawing.
Painting teachers are needed to teach either kids or adults. We offer oil, acrylic or watercolor for adults or teens. All elementary classes use acrylic and tempera.
NCE’s Holiday Concert will bring the finest classical masterpieces and holiday favorites together for the whole family. The festivities begin with Leroy Anderson’s classic “Sleigh Ride” and “Chanukkah Festival”, music from the Nutcracker and by J.S. Bach.
Outstanding Young Artist