“Washington Recession Begins”: DC Active Home Listings Soar, Jobless Claims Spike As DOGE Drains Swamp

Bright MLS, one of the largest multiple listing services in the US, just recently cautioned real estate agents and industry professionals:  A toxic mix of a “new Presidential administration and higher-than-expected mortgage rates contributed to a slow start to the 2025 housing market” across the Washington, DC, metro area, plus surrounding counties in Northern Virginia and Maryland. Now, the floodgates have opened—active listings are soaring, and jobless claims are spiking across the region, as the writing’s on the wall: an economic downturn is just ahead for the federal bureaucracy as ‘DC Swamp’ draining accelerates. 

Let’s start with the DC housing market and surrounding area trends.

Bright MLS’ latest monthly housing report for the Mid-Atlantic residential market, covering market trends through January, revealed a significant increase in active listings compared to the same period last year.

While a rise in listings is typical during a presidential transition year—especially ahead of the spring selling season—the region’s heavy concentration of federal workers is a major cause for concern in the era of President Trump and Elon Musk’s DOGE. That’s because, as of last week, Trump had already slashed 275,000 federal jobs.

Last month, local residential markets in Washington, DC, and surrounding counties in Northern Virginia and Maryland, saw a sharp increase in active listings, averaging 22.8%. Notably, Falls Church City, Virginia, experienced a 78.6% surge, followed by a 68.8% jump in Fairfax City, a 50.5% increase in Alexandria City, and a 33.5% uptick in Montgomery County, Maryland. These markets have a high concentration of federal workers, many of whom have spent their entire careers in the government without little to no experience in the private sector. 

The flood of active listings across the DC-Maryland-North Central Virginia areas occured when borrowing costs are at elevated levels. Data from Bright MLS’ T3 Home Demand Index shows that February has so far been “Slow” and/or “limited.” 

In other words, a supply imbalance across the DC region could drive housing prices lower. 

Housing market softness comes as President Trump and Musk’s DOGE eliminated 275,000 federal workers. This includes 75,000 who accepted the buyout and 200,000 workers on probation—those who have been in their roles for less than a year or, in some cases, up to two years. 

Trump & DOGE Fire Layoff Bazooka: Targets 200,000 Fed Workers On Probation https://t.co/xSnK4TAJBc

— zerohedge (@zerohedge) February 14, 2025

So far, Labor Department figures not adjusted for seasonal factors show that 4,000 workers in DC have already filed for unemployment insurance. 

BofA’s Michael Hartnett commented on DOGE trends in DC, telling clients: “Washington, DC recession begins.” 

Raj Namboothiry, senior vice president at Manpower North America, a workforce solutions company, told CNBC last week that jobless claims in DC will “go higher, and definitely we’ll be watching it very closely.” 

The combination of a declining federal workforce and softening housing market trends in the region could produce economic instabilities – something not seen in a generation as the DC swamp has been propped up with taxpayer funds – including lots and lots of USAID monies (read: DC Swamp Uniparty “Unmasked” As These Seven NGOs). 

Meanwhile, in Maryland, swamp draining by Trump and DOGE could push the state on a crash course to a “deep recession“ because of the already dire fiscal situation produced by far-left Democratic lawmakers, including Gov. Wes Moore.

Maryland’s Death Spiral: Reckless Democratic Lawmakers Spark Budget Crisis Fears As “Deep Recession” Looms https://t.co/reReKpxTsN

— zerohedge (@zerohedge) November 28, 2024

A large asset management company that operates in the region told us weeks ago that the financial situation in Maryland is so dire that they don’t even recommend the state’s muni bonds to their clients – and have instructed some clients to leave the state because of tax hike fears.

What may unfold is an economic downturn that could rip through the unaccountable federal bureaucracy in the DC Swamp that won’t get a bailout this time from taxpayers.

Bloomberg published a note a couple of years ago on navigating an economic downturn.

CC fed workers… Yes, Lentils – say goodbye to avocado and toast.

Inflation stings most if you earn less than $300K. Here’s how to deal:

Take the bus
Don’t buy in bulk
Try lentils instead of meat
Nobody said this would be fun https://t.co/HGJEoXL5ZZ

— Bloomberg Opinion (@opinion) March 19, 2022

Trump’s DOGE could be seen as a form of revenge for the working-class Americans whose lives have been upended by the unaccountable and reckless “Rich Men North of Richmond.”

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