You may have noticed from my recent blog posts that I love to examine societal trends – both nationwide and those specific to the District- to see how they have affected and will continue to affect DC real estate. My hope is that by understanding the “Why”, readers of this blog will look at DC real estate differently and make more informed choices about the “What”, “Where”, “When”, and “How Much” when making their real estate choices. Today’s post tackles another trend that is reshaping the real estate market in DC and is largely driven by young professionals*: the rise of the single person household.
In 1950, 10% of all American households were one-person households. Today that figure is 28% nationally, around 45% in DC, and continuing to rise*! While there are a multitude of factors that contribute to this long term trend- people marrying later in life, divorce rates increasing, the rise of the economic power and independence of women, urbanization, etc.- what I find most interesting is how this trend affects what we buy and where and how we live. DC is looking more and more like Europe every day (Stockholm is over 50% single person households) with little Fiats, Mini Coopers, and Smart Cars zipping around the streets (don’t even get me started on the Vespas and bicyclists!). While a lot of these changes can be ascribed to our society going “greener”, I believe that sheer pragmatism is just as significant of a factor in more people “going small”. More single-person households means less need for 4 doors (if you’re single, how often do you really use the rear doors of your car?) and a huge trunk to make Costco runs (if you live alone do you really need to buy toilet paper by the pallet?). Put simply, the trade-off of space for cost and efficiency is simply easier to make in smaller households.
Outside of auto manufacturers, we are also seeing real estate developers and urban planners responding to these trends with denser developments and ever smaller condo units. With 1,100 new residents entering the District each month (70% of them under the age of 35!)**, DC city planners have entertained a host of ideas to increase density, including a recent proposal to increase the maximum allowable building height above its current 160 ft threshold (By comparison Tulsa, OK has 17 buildings over 200 ft…even Fargo, N.D. has two!) and introducing the Fiat of real estate development, the micro studio, to our housing mix.
RISE OF THE MICRO STUDIO
At sizes ranging from 220 - 375 square feet, the “micro studio” is now being introduced to the DC market by some intrepid developers who feel that DC’s changing demographics will create an increasing demand for smaller living. To make these smaller spaces more attractive, developers are not only using architecture and design to make spaces feel bigger and function better but they are also creating community amenities and bringing in businesses that provide residents “living” space outside of their micro-units in an effort to foster connective living. From a design standpoint, this translates to higher ceilings, larger windows that are angled to pick up viewing area and capture more light, smaller appliances, and incorporating multi-functional furniture (think Murphy bed units that transform into couches, entertainment centers, desk space, and storage….check out this video!)
From a community standpoint, having business centers or coffee shops that are accessible to residents reduces the need for a home office or secondary living space in the unit. Having local grocery stores or encouraging farmers’ markets where residents can get easy access to fresh food reduces the need to have large kitchens to store food. By building self-sustaining environments that foster connectivity while creating interior spaces that maximize functionality, developers and city planners hope to attract DC’s growing single person households into denser and denser communities at price points they can afford (think below $250,000).
THE FUTURE OF DC REAL ESTATE IS SMALL
Will micro-studios catch on? We may get our first glimpse at the answer to this question when PN Hoffman-Madison Waterfront delivers its $1.5 billion, 35 acre redevelopment of the Southwest Waterfront (www.swdcwaterfront.com) , which will feature units ranging from 330-380 square feet (see rendering above). Even if micro-studios are not the ultimate answer to the need for denser living, the demographic trends are hard to ignore. With a growing population of single person households streaming into the District, smaller and smaller condos will become a greater percentage of our housing mix.
* Eric Klinenberg on Going Solo: The surprising benefits, to oneself and to society, of living alone . Smithsonian Magazine, February 2012.