Will DC Real Estate Get the Obama Bump?

Recently, I got an email with a link to a site called NewGeography, and an interesting post by a guy named Peter Smirniotopoulos.  And wow!  Talk about being optimistic about the immediate future for business in my town – he’s predicting that the election will generate 40,000 real estate transactions.

I wish.

But I think Peter is overly optimistic, even by my standards!

Here’s how it really works.

Yes, there will be some people leaving federal jobs and returning to wherever they moved here from.   And there will be a bunch of jobs to fill.  And oh my!  If that’s all it took to create a real estate transaction!

But here’s how it really works.

• Of the people leaving government, many will stay put and take jobs in local law firms and consulting outfits – in or out of government, these people have expertise that is more marketable here than almost anywhere else in the country.  These folks will not move, at least not because of the election.
• Many of the people taking political jobs with the new administration are here already.  They’ve spent the last eight years working at law and consulting firms waiting for the Democrats to take back the White House, and they are in strong demand because they understand how things get done.  They are not going to be buying houses because they already own homes in the area.
• Of the people moving here, a lot of them are going to be young and are likely to prefer renting a room in a group house in Adams Morgan to paying a mortgage on a condo or house.
• The people moving here with families are often in no position to buy.  Prices are high, and government salaries are not.  So they often rent, at least initially.
• A lot of the people moving here who would like to buy houses can’t, because their old home is not selling in wherever they are coming from.
• There are even stories of members of congress who team up to share basement apartments on Capitol Hill because they can’t afford a decent house or apartment.  Even Barak Obama rented a dingy junior 1-bedroom while he was a Senator.  When interviewed on 60-Minutes, his wife, Michelle, said she couldn’t stand to sleep there, so they stayed in a hotel when she was in town.

Yes, there will be a few sales, probably in the District or the very close-in suburbs.  But my experience with most administrations is that they are populated by a bunch of young workaholics who do not exactly aspire to gracious living.  They live in their offices and eat most of their meals from take-out bags or at receptions thrown by trade associations.

As someone who earns her living selling houses and apartments, I’m hoping that the truth lies somewhere in between Peter’s optimistic forecast and my rather jaded one.

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