Washington, DC Occupancy Consistent, Despite Big Supply Volumes

  in   Washington DC

Despite having to digest a sizable block of new apartment supply during the past decade, Washington, DC has ranked among the country’s most consistent apartment occupancy performers, with a rate hovering between 95% and 96%.

Today’s occupancy rate in Washington, DC stands at 95.8%, 40 basis points (bps) above the year-ago rate and just 80 bps below the multi-decade high posted not long ago in Fall 2019.

Helping to hold up Washington, DC’s apartment occupancy performance, lower- and middle-tier properties are doing quite well right now. The rate is best at 96.4% in the Class C units, followed by the 96% in the Class B apartments. Occupancy in Class A units is a little lower at 94.5% as of June, as existing luxury stock is facing competition from new completions offering big rent discounts during lease-up.

There’s some variation in occupancy across neighborhoods in metro Washington DC, mainly reflecting that the urban core performance took a tumble in the early days of the pandemic. While occupancy in Central DC, the Navy Yard/Capitol South and Northwest DC dipped to 89% to 90% in 2020, rates in those submarkets are back up to 93% to 94% as of June. However, those readings are still below the rates in other areas of the market, reflecting the competitive leasing environment that has been created with so much construction in each neighborhood.