DC Market Shows Subtle Signs of Softness

WASHINGTON, DC-The Greater Washington area’s real estate markets are without a doubt some of the strongest in the country. However, there are small signs of slowing growth that bear watching, according to some of the participants at the RealShare Washington event, held at the Renaissance Mayflower Hotel Wednesday.

While almost every speaker at the event lauded the strong fundamentals of the Washington, DC area’s real estate markets and projected a strong 2007, Bernard Haddigan, managing director of Marcus & Millichap, noted that there are signs of weakness is some class B and C assets in a few submarkets.

“The best asset classes have cap rates that are lower than what they were a few years ago,” he said. In some cases secondary assets, though, have seen cap rates rise several basis points. Marcus & Millichap, he said, is marketing some of these properties that have gone into foreclosure. “On the low end of the market the signs of [trouble] are there.”