Your Guide To Buying A House In D.C.

As the seat of the nation’s political life, Washington, D.C., has a lot to offer current and potential residents – from top-notch universities and a bustling city life to international culture.

If you’re thinking of moving to the district, it’s a good idea to research your options. Here’s everything you need to know about buying a house in D.C., including real estate tips, listings and market trend reports.

Why Buy A House In Washington, D.C.?

With a strong job market, rising home appreciation, and international flair, Washington, D.C. real estate can be a great place to buy a home. The biggest industry here is the federal government, but you’ll also find jobs in professional services, hospitality and tourism, and health care.

There are plenty of part-time residents within the district’s population of nearly 700,000, making it a great place to buy a rental property.

Although D.C. is currently thriving as a seller’s market, these real estate trends depend on the overall housing industry. If you’re looking to buy a home or invest in the D.C. market, you should know which neighborhoods have the best value.

Top 5 Real Estate Neighborhoods In D.C.

We’ve gathered a list of the Rocket Homes^SM top five real estate neighborhoods in D.C. Read on to learn more about how they’re the best value for your investment.

Capitol Hill

At the top of our list is Capitol Hill. It is the largest historical neighborhood in D.C. and has a population of around 29,000. It’s a mostly residential neighborhood with multiple schools but also boasts a busy commercial area with restaurants, shops and bars.

Some of the neighborhood’s famous landmarks include the U.S. Capitol, the Senate and House office buildings, the Library of Congress and the Supreme Court building. The median list price of homes in Capitol Hill is $780,000. According to the April 2023 Rocket Homes Capitol Hill trend report, that’s a 20.4% decrease from the previous month.

Check out more Capitol Hill real estate listings.

Adams Morgan

With a population of just over 16,000, Adams Morgan is home to many young professionals and boasts a vibrant nightlife scene – but there are plenty of schools, parks and shops, too. The median listing price of homes in Adams Morgan is $640,000. Home prices have dropped 1.5% since April 2022, which means it could be a good time to score a deal in this popular neighborhood.

Discover more Adams Morgan real estate listings.

Dupont Circle

Dupont Circle is a popular residential neighborhood with a population of 14,952. Some of its highlights include Dupont Circle Fountain, The Phillips Collection, which is America’s first museum of modern art, and Embassy Row, which lends an international vibe to the area.

Most residents rent in this neighborhood, so it’s a great choice if you’re looking to buy an investment property. The median listing home price is $550,000. Homes are selling for 0.9% less than they did in 2022.

Explore Dupont Circle real estate listings.

Georgetown

Georgetown is an upscale historic neighborhood that’s situated along the Potomac River with a population of nearly 15,000. It’s said to be named in honor of King George II and is home to Georgetown University. The median home listing price in Georgetown is $1.4 million. Listing prices have dropped 5% since April 2022, and Georgetown remains a buyer’s market.

Start your house hunt by browsing Georgetown real estate listings.

Columbia Heights

With a population of nearly 31,000, Columbia Heights is a perfect blend of urban life and a laid-back residential feel. The neighborhood is home to many restaurants, bars and Howard University, which could mean plenty of potential renters for an investment property. The median home listing price in Columbia Heights is $655,000, a 4.4% drop from April 2022.

Visit Columbia Heights real estate listings.

How To Buy A House In Washington, D.C.: Things To Know

If you’re thinking about making D.C. your home or you’re looking to invest there, it’s important to know the ins and outs of home buying in the region.

1. Prepare For High Price Tags

If you’re planning a move to the D.C. area, get ready to spend money. Washington, D.C. has a reputation as one of the most expensive cities in America to buy a home and pay property taxes. Home buyers may need to save longer for a down payment and closing costs and may end up with a hefty monthly mortgage payment.

Even in expensive areas, first-time home buyers can access home loan and down payment assistance programs to help make buying a home more accessible and affordable.

2. Consider The Surrounding Counties

If D.C.’s home prices are outside your budget, consider buying property in popular surrounding counties. Alexandria, Virginia; Frederick, Maryland and Silver Spring, Maryland, all offer more affordable housing and a 30-minute commute to the district.

3. Make Your Home Offer Quickly

Most homes in D.C. are on the market for fewer than 30 days. You’ll need to move fast to put in an offer when you spot a home you want to buy. Washington, D.C., is currently a buyer's market, which means homes may sell at or below their listing price. Preparing your budget, making a list of must-have features for a new home and figuring out how much you can borrow are all good ways to help you move quickly.

4. Partner With A Neighborhood Real Estate Agent

Your real estate agent or REALTOR^® will be the person who walks you through the process of buying a home, from touring properties to making an offer, hiring an inspector and helping guide you to the closing table. You’ll want to find an agent who has experience finding homes for sale in your chosen D.C. neighborhood.

5. Winter Is Often The Best Time To Buy

Winter isn’t usually considered the best time to buy a home because there are fewer homes on the market, but this may give you an advantage. With fewer shoppers, there’s less competition, and you may be able to negotiate seller concessions or receive generous contingency periods.

No matter where you choose to live, plan to look for homes in January and February for better deals.

6. Invest In Radon And Termite Testing

The Environmental Protection Agency has identified Washington, D.C., as an area with a higher potential for elevated radon levels. When you put in an offer on a home, make sure you include a home inspection contingency and complete a radon test and termite test – especially in older or historic homes.

Requirements For Buying A House In D.C.

To buy a house or condo in Washington, D.C., you’ll need to meet standard lending requirements, which means lenders are looking for:

Good Credit

When lenders check your credit history, they’re generally looking for a good credit score and few or no derogatory marks on your credit reports. The minimum credit score requirement will vary by mortgage program, but you’ll likely need a score of at least 620 for a conventional loan and a score of 500 or 580 for a Federal Housing Administration (FHA) loan.

Low Debt-To-Income Ratio

This ratio helps lenders measure how much debt you owe compared to your income. Requirements vary, but a low debt-to-income ratio (DTI) – around 50% or less – can help you qualify for a mortgage.

Financial Documentation

Be prepared to hand over a stack of paperwork when you apply for a mortgage. The lender will need to document your employment status, income, debts and assets to ensure you have enough money to cover the down payment and closing costs and make your monthly mortgage payments. The financial documentation usually includes pay stubs, tax returns, bank statements and W-2s.

An Appraisal

Your lender will order an appraisal during the underwriting process to determine the market value of the property you want to buy. The appraisal confirms that the amount of money you want to borrow lines up with the home’s value.

Down Payment

The down payment represents your initial investment in the property, and the amount you’ll need will vary with every home and mortgage program. Generally, you’ll need a down payment of around 3% – 5% for a conventional loan and 3.5% for an FHA loan. If you can put down 20% on a conventional loan, you’ll avoid paying private mortgage insurance.

The Bottom Line

Whether you’re interested in the district’s historic neighborhoods, nightlife or top universities, there’s something for every prospective home buyer in Washington, D.C.

Home prices are higher than average in this area, but with the guidance of a Rocket Homes Verified Partner Agent, you can be well on your way to finding a dream home within your budget.