Residential real estate is the silver lining among the current economic challenges facing Arlington County, most notably those posed by Metrorail's expansion to neighboring economic rival Tysons Corner, according to a new report.
Released Feb. 26, the "2013 Arlington Real Estate Market Review and Forecast" provides a snapshot of a county economy faring pretty well when compared with other areas of the country. Unemployment is low at just under 4 percent, and the tax base is nearly evenly split between residential and commercial payers, said Terry Holzheimer, director of the Arlington Economic Development. Residential real estate prices are increasing across the board, and new residential projects are being built across the county. The report, which Holzheimer presented Tuesday to some 200 bankers, real estate agents and economic development officials, is available at arlingtonvirginiausa.com.
"Right now, there are not enough homes to meet the demand," Holzheimer said. "Our housing prices are high and are going to get higher."
About a month ago, Caroline Fleming and her husband, Joe, found themselves on the right side of this trend when they put their one-bedroom condo, within a block of the Ballston Metro station, on the market. The listing went out on a Friday, and the couple had a contract barely 48 hours later. They close Thursday.
"I'll never get that lucky again," Fleming said.
The average Arlington condo price bottomed out at $392,948 in 2008, Holzheimer said. In 2012, the average condo sold for $408,142.
Developers look for this type of market. Retailers follow robust residential sales, said George Galloway, managing principal of Next Realty Mid-Atlantic LLC. His firm specializes in buying and developing commercial retail locations. For a decade now, Galloway has focused on urban villages, such as those surrounding the Metrorail stations along the Orange, Blue, and Yellow lines in Arlington.
"The closer to transit stations, the better," Galloway said.
When addressing the near future, Holzheimer explained Arlington has several years' worth of steady residential growth ahead, with an average of 1,000 new units to come on the market annually.
Holzheimer's 2013 forecast lists 7,890 residential units in the pipeline, including about 3,200 units currently under construction, with the rest in various stages of the planning and approval process.
But Holzheimer warned challenges do exist. The ongoing effort to rebuild and rebrand neighboring Tysons Corner into a residential and commercial hub served by mass transit has the potential to cast a shadow on Arlington. When the Metro's Silver Line begins service to Tysons Corner next year, one of Arlington's main competitive advantages with employers and residents -- Metro access -- will not be quite so unique to Northern Virginia.
The current residential density around the county's Metro stations and Arlington's continued residential construction pace, though, is something Holzheimer predicted will take decades for Tysons to match, if it can.
"Rome wasn't built in a day and neither will Tysons," Holzheimer said.