Parc Reston Investment Analysis (2017)

This analysis is intended to examine the financial performance of 1bd/1bth and 2bd/2bth condos in Parc Reston, a condo complex in close proximity to Reston Town Center in Reston, VA. I pulled sales and rental data for both 1bd/1bth and 2bd/2bth condos in the complex from 2012-present. Below, please find scatter plots of this data along with lines of best fit to show trends in the data.

Over the past 5 years, owners of 1bd/1bth condos have seen modest increases in rent from approximately $1,350/month to about $1,450/month. When compared to average prices, shown in the chart below, owners generate a 9% cap rate (annual income/acquisition price), which is above the 6.02% cap rate average for the 20190 zip code.

As you can see in the chart above, final sales prices of 1bd/1bth condos increased to a high in 2014, but have since decreased. This could be attributed to a variety of factors, one potentially being an increase in supply of real estate (new luxury highrise condo buildings).

Unlike the 1bd/1bth rent chart above, rents for 2bd/2bth condos in Parc Reston have remained at the same level over the past 5 years (approximately $1,700/month on average). When compared to average prices, shown in the chart below, owners generate a 7.73% cap rate (annual income/acquisition price), which is above the 6.02% cap rate average for the 20190 zip code.

Similar to 1bd/1bths in Parc Reston, final sales prices of 2bd/2bth condos increased to a high in 2014, but have since decreased. Now may be a good time to look for some buying opportunities in this condo complex as rents remain consistent while prices have retreated slightly.

This is a quick financial analysis of a neighborhood that I am looking to invest in. If you would like me to assist you in generating a similar report for an area of interest in your portfolio, please don’t hesitate to reach out to me at kevin@thebarberagroup.com. I am happy to assist!

Thanks!

Kevin Barbera