Trump Layoffs Blamed as Washington, D.C. Housing Market Weakens

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Trump Layoffs Blamed as Washington, D.C. Housing Market Weakens


The Washington, D.C. housing market has started to weaken amidst mass layoffs of federal workers ordered by Elon Musk‘s so-called Department of Government Efficiency (DOGE), new data from Realtor.com show.

While the Trump administration’s efforts to shrink the “bloated” size of the federal government, as in the words of the president, have not yet had an impact on most of the markets with the highest concentration of federal workers, the Washington, D.C. area is seeing a rapid rise in the number of homes for sale, Realtor.com found.

Why It Matters

Since Donald Trump‘s inauguration on January 20 and the establishment of the new Musk-led advisory body, DOGE, thousands of federal workers across several government agencies have been fired, while thousands others have taken the Trump administration’s buyout offer known as “Fork in the Road” and voluntarily resigned.

In the wake of the first wave of mass layoffs, experts warned that the housing markets of cities with the highest number of federal workers could be upended by the Trump administration’s efforts to reduce the government’s workforce.

What To Know

In the week ending on March 8, the number of homes for sale in the Washington, D.C. area market grew by 56.2 percent compared to a year earlier, Realtor.com found.

It was the third consecutive week of rising inventory, after the number of homes for sale in the metropolitan area grew by 46.5 percent year-over-year in the week ending on February 22, and by an even higher 48.3 percent year-over-year in the week ending on March 1.

Eleven percent of the U.S. federal workforce is based in Washington, D.C., according to data from Realtor.com—which explains why the metro was immediately affected by the DOGE-led layoffs.

Experts said that the mass firings are likely to cause a drop in demand in markets like Washington, D.C. at the same time as inventory is likely to increase due to fired workers trying to offload their properties.

Washington DC Federal Workers
Thousands protest the Trump administration’s federal funding cuts during the Stand-Up for Science rally in Washington, D.C., Friday, March 7, 2025.

DOMINIC GWINN/Middle East Images/AFP via Getty Images

The growth in inventory started in January, according to Realtor.com data, with an increase of 35.9 percent year-over-year and continued in February, when the number of homes for sale was up 41 percent compared to a year earlier.

Inventory has also increased, though much more modestly, in the other U.S. metros with the highest concentration of federal workers. The metro area of Virginia Beach-Chesapeake-Norfolk, Virginia and North Carolina, has a 7 percent share of federal workers; here, active listings went up by 28.3 percent in the week ending on March 8.

In Oklahoma City, Oklahoma, which has 4.2 percent of federal workers, by 32.3 percent; in Baltimore-Columbia-Towson, Maryland, which has 3.7 percent of federal workers, by 32.3 percent; and in San Diego-Chula Vista-Carlsbad, California, with a share of 3.1 percent federal workers, by 63.8 percent.

What People Are Saying

Realtor.com Chief Economist Danielle Hale said in a statement shared with Newsweek: “The adjustment period following federal layoffs and funding cuts has likely put some Washington, D.C. home searches on hold, both for those whose jobs have been directly impacted and those who may be concerned about what’s ahead, and the data hints at these challenges.”

She added: “So far, we’re seeing more homes on the market, and modestly lower asking prices, but the situation continues to evolve.”

John Burns Research and Consulting wrote in a recent report: “The DC housing market is already showing signs of hesitancy. Consumers and investors are adopting a wait-and-see approach before proceeding with purchases. New home closings declined by 16 percent in the year leading up to December 2024, according to JBREC’s latest DC market analysis, and the resale market appears stagnant.”

What Happens Next

Hale said that she expects the same weakness now developing in the Washington, D.C. housing market to take over in other U.S. markets where a high number of federal workers is concentrated.

“While D.C. has the largest share of federal workers in the country, other highly federally employed markets could see similar shifts in the coming weeks or months,” she said. “While I expect many households will choose to stay in the area and pivot to find new job opportunities, some will likely choose to leave and retire or find a job elsewhere.”



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