It is difficult to say how many of the 162,000 federal job losses recorded in October and November hit households specifically in the Washington, D.C., metro area.
The Mortgage Bankers Association estimates that nearly a quarter-million government positions have been shed over the course of this year, the result of aggressive actions taken by the Trump administration to shrink the federal workforce.
Those actions include deferred-resignation programs, mass firings at federal agencies and programmatic cuts to federal initiatives that do not align with administration priorities, from fair lending enforcement to the provision of foreign aid and assistance.
It is not difficult to say, however, that the long-term impact of these cuts on the Washington, D.C., housing market remains to be full realized.
Lisa Sturtevant, chief economist of Bright MLS, a multiple-listing service that spans seven states in the mid-Atlantic region as well as the U.S. capital, has watched the unemployment rate in Washington, D.C., rise steadily in 2025.
From 3.1% at the beginning of the year to 4.1% in September, unemployment in the D.C. metro area has risen at more than double the pace of the national jobless rate, which rose from 4% in January to 4.4% in September, and clocked in at 4.6% in November.
“Homes are staying on the market longer and price growth has slowed considerably,” said Sturtevant, sharing her reaction to this week’s shutdown-delayed jobs figures with Scotsman Guide.
She described the U.S. capital region as “particularly vulnerable to cuts in the federal government workforce,” with federal government employment in the greater metro area at its lowest level since early 2009.
The Urban Institute, a research and policy nonprofit based in the U.S. capital, estimates that as of March nearly 1 in 10 workers in the Washington, D.C., metro area was employed by the federal government. The D.C. metro area spans adjacent counties in Maryland and Virginia.
Nearly 445,000 civilian federal employees were dispersed across Washington, D.C., Virginia and Maryland as of March, the Urban Institute calculated.
Uncertainty around federal job and budget cuts that have produced a regional housing chill will likely persist in 2026, Sturtevant says. Fourth-quarter sales in the district are down 2%, while year-to-date sales are down 0.8% through November.
Meanwhile, the number of active listings in the fourth quarter is 34% higher than a year ago, Bright MLS data shows, which she attributes to cautious buyer behavior.
Housing inventory in the metro area is more than double pre-pandemic levels as of the fourth quarter of 2025, pushing down prices.
“We have probably not seen the full impact on the region’s housing market related to the federal government workforce cuts,” Sturtevant added.
