Federal workforce cuts under the Trump administration’s Department of Government Efficiency (DOGE) initiative are having a ripple effect on the Washington, D.C., housing market. Nearly 40% of real estate agents said they’re working with clients whose buying or selling decisions are being influenced by federal job losses, according to a new Bright MLS survey released this week.

More than half of area real estate agents reported that DOGE-initiated layoffs and budget cuts are influencing housing sales activity in their local markets, with 43% saying the cuts have driven more home sales versus just 3% citing increased buying activity.

With more sellers than buyers flooding the market, regional home prices are taking a tumble. In fact, 38% of agents and brokers in the area cited the federal layoffs and cuts as contributing factors to declining home prices, while 2% reported the opposite, according to Bright MLS’ research.

The agent survey was conducted in May based on transactions closed during March, April and May. Surveyed agents reported that less than 10% of sellers across Bright MLS’ service area cited retirement as a reason they’re selling this spring, and 15% of all sales in the greater Washington, D.C., region were driven by retirement-related decisions.

“Based on our survey of agents working with home sellers, the buyout offer may be driving retirement decisions in the greater Washington, D.C., region,” wrote Lisa Sturtevant, the study’s author and chief economist with Bright MLS.

The findings come after more than 279,000 federal layoffs were announced as of March, up 672% from the 36,195 cuts announced in the first quarter of 2024, according to Challenger, Gray & Christmas, a Chicago-based executive outplacement firm.

An additional 75,000 employees have accepted buyout offers since the second Trump administration took over, according to the Office of Personnel Management.

Redfin data separately shows that the number of active listings for sale in the Washington, D.C., metro area spiked 25.1% in April compared to the year prior. That’s the highest level since 2022 and the largest gain on record. Comparatively, the U.S. saw a 14.2% increase in active listings across the country, Redfin reported.
The full impact of federal workforce changes is unknown as legal challenges of the mass layoffs continue and some laid-off workers are recalled to work.

“Homeowners impacted by DOGE who do not have children were more likely to sell this spring, but we could see more home sales by DOGE-impacted families this summer after the end of the school year and as federal buyout payments come to an end,” Sturtevant noted.

As for the future, if federal layoffs pick back up, expect the housing market to feel the blow, Sturtevant cautioned.

“Home prices are still holding firm in the Washington, D.C., area, though sellers are increasingly cutting their asking price and agents report a softening of prices,” Sturtevant wrote. “By fall, the increase in inventory in the region could lead to flat or falling home prices in some area markets.”

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