Federal uncertainty weighs on D.C. housing market
Driving economic shifts
The District's economy is undergoing a transformation with a focus on diversifying away from federal government dependence. Mayor Bowser's FY26 budget includes initiatives to attract new businesses and grow the sports, entertainment, and technology industries. This includes investments in projects like the Capital One Arena improvements and the creation of a DC Technology Ecosystem Fund.
Housing market right now
The Washington, D.C. housing market is projected to see a slight price correction, with a 1% decline in median sales price anticipated in 2026. Active listings are up over 33% year-over-year, and homes are taking longer to sell, averaging 45-70 days on market. The median sale price in December 2025 was $713,000.
Migration patterns
The District of Columbia experienced a net outflow of domestic residents in 2025, with the rate of people leaving for other U.S. locations increasing. International migration, which previously fueled population growth, also declined in 2025. U-Haul data from January to July 2025 listed Washington, D.C. as a top origin metro area for customers moving out.
Headwinds
Federal government uncertainty is a primary factor contributing to weaker demand in the D.C. housing market, contrasting with projected price growth in other Mid-Atlantic markets. The District also experienced significant federal job losses in late 2025, impacting the Professional Business Services sector. This has led to a weaker employer and worker demand for D.C.
Key facts
- The District of Columbia gained 2,335 residents from July 2024 to July 2025, primarily due to natural increase and international migration. (DC Office of Planning, January 2026)
- The median sales price of homes in the D.C. region is projected to drop 1% to $616,700 in 2026. (Bright MLS, December 2025)
- The District's population growth slowed to 0.3% in 2025, underperforming the national average of 0.5%. (U.S. Census Bureau, January 2026)
- The FY 2026 Budget Support Act of 2025 includes provisions to expand the Housing in Downtown program, supporting commercial-to-residential conversions with a 20-year tax abatement. (Council of the District of Columbia, October 2025)
- The RFK Stadium site is undergoing a major redevelopment, with demolition of the old stadium scheduled for completion by late 2026. (DC Real Estate Mama, January 2026)