Logan Circle is a historic neighborhood in Washington, D.C. Primarily residential, Logan Circle has undergone major urban redevelopment over the last century, making it one of the city’s most sought-after areas. Since the area’s real estate market is trending up, now is a perfect time to own property. Beyond that reason, here is why buying a home in Logan Circle is a solid investment.
Why Should You Buy a House in Logan Circle?
Incredible Architecture
Logan Circle is known for its stately Victorian-style houses that offer residents unique and classic living arrangements. Many of these properties also boast well-kept yards that give the area a graceful, sophisticated charm. Those looking for a property with updated features will love the neighborhood’s 14th Street and P Street corridors, as they offer new loft condominiums with first-class amenities.
Many Urban Conveniences
After a short period of economic decline, Logan Circle has rebounded in recent years — and at an incredible rate. The neighborhood now offers a diverse number of shops and businesses. Many of these shops, restaurants, cafes, boutiques, and other businesses are just moments away from many of Logan Circle’s residential areas. Everything needed is just a pleasant stroll away, including grocery stores, gyms, and specialty shops.
Vibrant Arts and Cultural Scene
Buying a home in Logan Circle unlocks the door to a constantly-evolving and vibrant arts and cultural scene. The neighborhood boasts a number of venues worth exploring, such as the Studio Theatre, which hosts live venues and shows. You can also explore live music at the two-story concert venue called Black Cat. The neighborhood’s main streets feature rows of art galleries, venues, restaurants, and boutiques that all tie into the area’s historical culture.
What to Know About Buying a House in Logan Circle
Median House Price
The median asking price for a home in Logan Circle is around $892,000, making it one of the most expensive neighborhoods in Washington, D.C.
Closing Costs
If you’re buying a home in Logan Circle, you will likely pay 3-5% of the property’s sale price in closing costs. For instance, if your new home costs $700,000, you will likely pay between $21,000 and $35,000 in closing costs. In comparison, Washington, DC homebuyers in 2022 typically paid an average of $30,000 in closing costs.
Property Taxes
Compared to the rest of the country, homeowners in Washington, D.C., typically pay some of the lowest property tax rates. The tax rate on a residential property in the District is only $0.85 per $100 in assessed value. Additionally, the District of Columbia offers generous deductions and credits for many homeowners, possibly decreasing their property tax rate to just 0.55%.
Requirements for Buying a House in Logan Circle
Home Purchase Assistance Program (HPAP)
Washington, D.C. residents can benefit from the Home Purchase Assistance Program (HPAP), which provides interest-free loans to qualified applicants. HPAP also offers closing cost assistance. Eligible applicants may receive up to $202,000 in gap financing assistance, as well as $4,000 in closing cost assistance. Borrowers with incomes 80 percent below the area median income (AMI) can defer their payments until the property is sold, refinanced, or no longer serves as their primary residence. Borrowers with between 80 percent to 110 percent AMI can defer their payments for five years.
Employer-Assisted Housing Program (EAHP)
District government employees buying a home in Logan Circle can take advantage of the area’s Employer-Assisted Housing Program (EAHP). The EAHP offers eligible people a deferred 0% interest loan, as well as a matching grant for closing costs and a down payment on their first property in D.C. The EAHP has no income cap for applicants or any cash contribution requirements.
FHA Loan
FHA loans typically allow individuals with lower credit scores to qualify for a loan. FHA loans hold a minimum down payment of 3.5% for borrowers who have a credit score of 580 or higher. FHA loans require that your debt-to-income ratio — the percentage of your monthly income you pay towards debt — be 50% or lower. In 2023, the FHA loan limit is $472,030 in lower-cost areas and $1,089,300 in higher-value markets.
Money-Saving Tips for Buying a Home in Logan Circle
Find the Best Mortgage Rate
Finding the best mortgage rate includes several different steps, such as improving your credit score, saving for a more significant down payment, and understanding your debt-to-income ratio.
Increase Your Credit Score
Before buying a home in Logan Circle, increasing your credit score is a surefire way of obtaining a better mortgage rate and ultimately saving money. The lower your credit score, the higher your interest rate will likely be.
Use a Bigger Down Payment to Keep Monthly Payments Down
Putting more money down on the home you’re purchasing can go a long way in keeping your monthly mortgage payments lower. This is especially true if you can fund a 20 percent down payment. If you cannot afford the 20 percent down payment, consider applying for specific grants, loans, and other programs designed to help you purchase a house.
Understand Your Debt-to-Income Ratio
Your debt-to-income (DTI) ratio is how much money you make compared to how much you owe. DTI compares your entire monthly debt payments against your monthly gross income. The lower your DTI ratio, the more attractive you are to lenders. This means you could achieve a lower mortgage rate.
Hire an Experienced Logan Circle Real Estate Agent
If you’re buying a home in Logan Circle, you need a skilled Washington DC real estate agent on your side. Thomas Kolker has years of experience helping buyers in the Washington, D.C., area find the home of their dreams. To get started, contact him today.
