Washington Speculators In ‘Full Retreat’
The Washington Post has this on speculators. “Investors who sought quick profits buying and selling real estate in the Washington region are in full retreat, dampening demand for homes, most notably for condos. What is becoming apparent, market watchers say, is how big a part speculators played in the region’s real estate boom of the past few years.”
“They helped send prices soaring at unprecedented rates. And now many are trying to sell, or rent at a loss. Some may eventually dump properties at low prices to get rid of them. That could weigh down values for everyone.”
“Sales of new condos fell 43 percent in the first quarter of the year, and there are almost four times as many existing condos for sale than last year. ‘We think the softness of the market is largely due to the pulling out of investors,’ said Gopal Ahluwalia, at the National Association of Home Builders. ‘They have not only pulled back, they are canceling purchases.’”
“While condominiums were the product of choice for investors, luxury neighborhoods also fell prey to real estate speculation, leading to the prospect of price drops even in affluent subdivisions. ‘Here we had it even in $1 million homes,’ said Kenneth Wenhold.”
“There are about 25,853 new condos being marketed locally now. But only about 1,996 new condos were sold from January to March, down from 3,520 in the first three months of last year. And the area’s MLS, which lists mostly previously owned properties, showed about 5,500 condos and co-ops for sale in March in Washington and the close-in suburbs. That was about a fourfold increase from about 1,400 listed in March 2005.”
“The situation has made home shoppers more wary about making purchases. Some buyers are even walking away from transactions. Lawyer Angana Shah almost bought a new one-bedroom apartment in Adams Morgan last month for $454,000, but as the settlement date approached, she found herself ‘petrified’ over the high price and worried that values would fall.”
“She decided to walk away from the sale and got her money back. She was glad she did because prices have flattened and she can now afford a two-bedroom instead. ‘I don’t want a one-bedroom anymore,’ she said. ‘I want a two-bedroom. Now people are begging people to buy one-bedrooms. The market is better. I couldn’t have bought a two-bedroom last fall and prices for one-bedrooms are falling.’”
Thanks to the readers who sent this link in.
One bedroom condo’s for everyone!
Halleluja - the Post has finally spoken! I was ragging on ‘em in here yesterday for their incessant cheerleading. Wonder if they read Ben’s blog? They actually printed the picture of the “bubblicious bench” in the paper this morning - the one that’s been all over the ‘net. That photo will no doubt go down in history as icon.
Ben knows who lurks here.
Nearly all of the media outlets and reporter lurk here.
When the bubble coverage was just picking up steam and a topic was discussed like expats buying Mexican and Central American real esate within 60 days there were stories on the topic.
This thought is for the media . If your thinking of the good of the Country , start writing articles about how unsound lending /underwriting is today and how there should be a requirement for higher down payments . People walk when they don’t have anything invested and that would keep alot of the speculators out if they had a requirement for 20 to 30 % down payments . Lets get back to a true demand market …..That being said , it’s to late to correct the bizarre lending practices of the last 4 years of which the last 2 years have very risky loan packages on the books .No need to continue with it .
This article is on the front page, above the fold. Even the people waiting at the bus stop can see this headline through the vending machine window.
Nobody thought about the mechanics of freefall. Those $1m spec houses are going to cost $6000/mo and an empty one brings in the same as an empty 1br condo. At that level leases or rentals are going to people smart enough to know the score. They will not pay enough to keep the owner solvent because it is in their best interests to force him to drown.
But that’s not what I wanted to talk about. Let’s look at the implications for “gentrification.” One word; over. The urban renniasance was a symptom of bubble mania. These reclaimed neighborhoods are going to spiral in. Not enough people for critical mass, the people that are there will bifurcate twixt trapped owners and rent vultures. Scary stuff for its crime implications and such.
The jury is still definately out on the long term trends for urban gentrification. True, the census is telling us people are leaving the cities because they are too expensive. But gas is also getting expensive, and so will oil/tires, with inflation kicking in soon driving up the cost of… driving.
I see many blog posts claiming that the exurban fringes will become the new slums and/or ghost towns.
I guess, basically anything can happen, as the implosion goes forward.
Mozo Maz,
Listen to DC_Too he’s got the inside scoop. This renewal stuff has always been a big scam. It only works with massive doses of public subsidy. That’s coming to a screeching halt as municipalities face cash problems.
The myth of the suburbs contracting is just that blowhard Kunstler spouting his long emergency junk again.
I’m a city kid by birth and would rather choke than live in the ‘burbs, but that’s my personal choice. I’ve got newbie neighbors that show symptoms of shock and awe when there’s an incident in the street involving guns and lots of cops. Hey, at least the cops respond nowadays. That’s progress!
The only unknowable IMHO, is energy prices. It is conceivable that $11 gasoline will renew interest in urban living. There is also a long, very long, shot that is unique to DC - Congress is kicking around the idea of a flat income tax for DC residents. If that were to happen, every rich bastard in America will buy 300 square feet of property here and declare “primary residence.” Like I said, it’s a long shot, but if it were to happen, I will pay cash for a garden tool shed in DC’s worst ghetto, just in case…..
Wonder if $11 gas will renew interest in cardio commuting, i.e. ride a bike to work? I actually used to do that. You know what? It doesn’t kill you!
I did that too for awhile (and after that I walked to work). It makes you stronger!
I can’t wait for $11.00 /gal gas. Get the traffic off the roads. Cut my commute time in half
Forget $11 gas,all of the mortgage resets will cripple the RE market by increasing inventory enormously. It will take an enormous amount of time to work off the inventory
I will be biking to work from my new residence (a rental rowhouse near the capitol). It’s only a 15 minute ride.
Who’s to say that high gas prices won’t boost telecommuting? No need to live in the city (state, or even country) to telecommute.
I think the neighborhoods that gentrified or are still gentrifying are at the greatest risk. I would be scared $hitless if I had bought in one of these areas.
The gas thing is very real, though. I’m about to rent a house in an area of DC that is recently gentrified/still gentrifying because I’m tired of the high cost of gas of living in the suburbs (I work downtown).
I think the decline is going to affect everywhere, urban areas, suburban area, but the most affected will be the highest speculated areas. Established areas that have seen little recent speculation, will fare the best, whether they be in the city or the suburbs.
That is quite the topic, Robert. I live in just such a neighborhood. It’s come a long way, but just isn’t “there” yet. Sales prices have gone through the roof, but my rent is still cheap, and what retail exists remains accesible only through the tiny slot below the bullet-proof glass cacoon. The quart of milk is still spun through a miniature, two-inch thick glass revolving door….
I’ve stated my humble opinion over and over, that when this thing ends, rational buyers will return to “established” neighborhoods and leave the “pioneers” twisting in the wind, at the mercy of the crack heads….
DC_too,
Adams Morgan/Kalorama here. I’ve been wondering too about the stability of prices in different neighborhoods when this thing clears. Not just idling wondering either - we were served three weeks ago with the notice that our building sold, and now the tenants are talking with lawyers about trying to buy the building with a developer.
It’s going to be a really hard decision. I’ve been very happy renting here - I love the building and the neighborhood. In a normal market, I’d be thrilled to buy our apartment, a huge one bedroom overlooking a park, with hardwood floors and tons of light, particularly at a tenant’s discount. We can afford to, even though it might cost more than renting. But I’m extremely worried about purchasing at the top, even with the discount, even in Adams Morgan, which everyone keeps trying to convince me will retain much of its value even in a correction.
I’m not sure what we’ll decide to do yet. Wait to see what kind of deal we can get, for sure. But as much as I’ve cautioned others not to buy in the last two years I don’t want to make a mistake myself, and get left holding the bag at the end of this because I loved my apartment too much to leave it.
Matilde,
That’s a tough spot to be in. You are a long way from my ‘hood and I don’t see any “neighborhood risk” over there. Property values will fall, over the near to medium term, sure, but I don’t think your neighborhood is a candidate for some cheesy Curt Russell flick with maurading hooligans helping themselves to random womanhood. Mine? Maybe, but not yours.
I’d look at the “insider price” and run the numbers. Then you’ll just have to make a decision. Good luck…
DC_Too, where are you at?
The place I just signed to rent is right near Union Station, right near the old Children’s museum (which is being turned into condos). What do you think about my area? The area seems pretty OK to me, to rent in at least.
what used to be a pioneering neighborhood now is established. affluent people would not cross 16th st. 15 years ago. Now people pay $1 million for houses over there.
http://www.dcbubble.blogspot.com
DCBubble - People WERE paying $1million for houses over there. It’s over, fucknuts. Can’t you read?
DC_Too- agreed, the “urban renaissance” is finito santiago. my sympathy to the pioneer on the bleeding edge.
Exurbs for everyone!
The urban renniasance was a symptom of bubble mania. These reclaimed neighborhoods are going to spiral in.
Definitely the case in DC, Robert. They’ve been building “condo islands” in oceans of crack houses and boarded-up buildings. It’s amazing to see bums and idle teenagers loitering around the perimeter of brand-new condo complexes, with newspapers and trash blowing around the sidewalks. Who is going to live in a place like that?
I would - for the right price. That is the thing that has got my underwear twisted these past few years. OK, so I live in the ghetto. It’s manageable, and silly cheap to rent. Why the hell are people paying Georgetown prices to buy here? Oh, I forgot, it’s a bubble mania. They think prices will go EVEN HIGHER.
Living on the fringe ain’t so bad, I just expect my housing expense to reflect the neighborhood. Which brings us right back where we started. You wanna place to live? Got a downpayment, a good job? You go to Glover Park, not H Street NE, for Christ’s sake.
In Dallas lots of other wise empty office buildings have been and are in the process of being converted to lofts/apartments. The city has been giving the developers millions of $$$$ in tax abatements and tax credits. Once those tax abatements end and the new owners ( the developers of course being long gone)start having to pay that nice 3% property taxe it will be a stampeded to get out.
You want to laugh? Look at Craigslist Dallas at some of the prices these deluded idiots are trying to get in rent on both SFH and “lofts”, condos, etc. I’m sure they get no traffic because the same ads are up day after day . . .
My neighbor across the street just changed realtors after the first one failed to sell his flip after 6 months on the market. Listed with a new mullet at the same price. Oh yea, that will work. NOT
Like this one? cookie-cutter McMansion listed at $1,045,000. Purchased in May 2005 — less than a year ago — for $868K. Flipper thinks the place has gone up $180K in value in 11 months.
Recordation Date: 05/12/2005
Sale Price: $868,038
Most recent Instrument ID: 200505120047418
Deed Year: 2005
I actually like that house, except for the “3 sides brick”. WTF is up with builders around here? They seem to have this fetish with having the front and back in brick, but the sides in vinyl siding. At least this place only has one side that is vinyl siding.
Sure, it’s not a bad place (if you don’t mind paying $800/mo to heat and cool it), but the point is, it’s not worth nearly $200K more than it was 11 months ago. In fact, it will probably eventually sell for less if it sells at all. These places are a dime a dozen in Loudoun County, and very few people here really make enough to afford a $1m place. As for the 3-sides brick, I agree it’s total BS on a home that expensive, but it’s actually more than you typically see on homes in this price range. Many of them just have a brick facade with flimsy vinyl siding (and cheap windows) around the rest.
IMHO, if the deed restrictions of a contemporary neighborhood do not require four-side brick (or real stucco or equivalent), then it wasn’t designed to be an upscale ‘hood in the first place. To me, one of the marks of a well-designed higher-end neighborhood is assurance that your neighbors to the rear have approximately as pleasant a view of your house as they would from its front.
Good point, chip.
No wonder people from California overpay for homes in other states . This listing would go for a small fortune in Ca.
I think that we will see contraction on both ends - exurban and “up and coming” urban neighborhoods - as prices fall. This phenomenon took place during the last East Coast crash. So basically, if you live near a farmhouse or a crack house, you may be screwed.
Nicely put and exactly right. Both gentrification and exurb projects will contract.
‘I don’t want a one-bedroom anymore,’ she said. ‘I want a two-bedroom. Now people are begging people to buy one-bedrooms. The market is better. I couldn’t have bought a two-bedroom last fall and prices for one-bedrooms are falling.’”
This is why the median price will hold up longer than many think. It is what I witnessed first hand in the early ’90s. Buyers will not necessarily spend much less (especially as rates remain “relatively” low), but they will get more for their money. As the inventory soars, all but the best houses sit unsold, houses that would have sold quickly for top dollar when the market was flying high.
I am seeing this now in the San Fernando Valley. The median remains high, but in looking at individual comps, I can easily see that prices are softening. Last year this time we had only one active listing for each sale, this year, almost 5 active listings to each sale. Big difference in what the buyers get when 4 of 5 houses go unsold in a month.
Deb - Good observation - the median price is just that, median. There’s no such thing as a “median house,” though, there’s only your house, his house and my house. A rational, “end using” home buyer will go for as much as he can reasonably afford, thus keeping the “median price” steady. If you’ve got real estate for sale, however, that should not be any source of comfort.
Deb, thanks for a timely insight, one to keep in mind in the upcoming months as NAR et al try to spin a falling knife.
The Great Housing Crash of DC/NoVA has begun. There’s no reversing the downward trend, which will quickly accelerate as sellers realize that there’s no “spring rally”. YOY median prices in Loudoun County actually declined last month for the first time in years. Inventory is up over 400% in NoVA. As I posted last night, inventory rose 2% from Thursday to Friday of this week. The degree of speculation here is astounding. Even in the far-flung rural areas like Purcellville, prices are beyond absurd. Who in their right mind would pay over a half a million dollars for a tiny, beat-up rambler in a cow town seventy miles from DC (with tens of thousands of acres of buildable land in every direction)?
Everyone has been speculating in real estate here, using ultra-aggressive financing to buy townhouses and million-dollar tract houses to flip. When my wife and I moved here in the Fall of 04, we saw that people were buying homes and immediately relisting them for as much as $300K over the purchase price. Now the For Sale signs are sprouting like weeds and nothing is moving. Inventory is going vertical and much more new-construction inventory is going to hit the market this spring and summer.
Interesting note on the Washington Post article - did you notice that the term “soft landing” didn’t appear anywhere? Even the Realtors have given up on trying to sell that ridiculous line.
Where is DCBubble? Please defend your area!
Crispy - Go check out the “comment section” of DCBubble’s wesite - it is Real Estate Agent Central. Too funny. “Great time to buy!”
Why do people think “housing,” as an asset, should perform any differently than another asset like a stock certificate, bond, etc. If one is an investor, the return on investment over time must be considered relative to the purchase price. Bingo, good investment. But if you are buying something “because someone will give me more for it later” you really ought to go to Vegas Baby and bet on Red. Or Black.
The housing asset bubble really doesn’t impove our lives in collective, its another way of moving money from the stupid to the smart, taking advantage of greed and fear, and generally adding to inflation.
Oh, and giving assh*les something to talk about at parties. Like they’ve accomplished something, even though they didnt so much as pick up a hammer or nail to make the property better. “Oh yes, I bought something, then sold it later for more money. Just like a bunch of other people. I’m such a financial genius. Now, I’m going to take my profit and buy options on 20 new condos in a new building with another empty condo building right next to it.”
Let’s look at the implications for “gentrification.” One word; over. The urban renniasance was a symptom of bubble mania. These reclaimed neighborhoods are going to spiral in. Not enough people for critical mass, the people that are there will bifurcate twixt trapped owners and rent vultures. Scary stuff for its crime implications and such.
Nah. Not gonna happen. Just the opposite in fact– at least in places like the DC area with good public transportation. It’s the far out suburbs, with their oversized houses and commutes that are screwed.
Of course there will always be some neighborhoods where no one wants to live– I’ve lived in one of ‘em myself– Venice, CA in the early ’80’s. And our old Del Rey neighborhood in Alexandria was considered ‘borderline’ when we moved there almost 7 years ago. Rents were low, and we bought our townhouse there after it had been sitting on the market for months and gone through about 5 price reductions.
‘Gentrification’ is a trend that’s been gradually building for 40 years. And my generation (boomers) retiring is going to really tip the balance… A lot of people are already realizing that they don’t want to spend hours on their duffs in the car every time they need a tube of toothpaste. Add to that having far less money than our parents to survive on in retirement and I think we’ll see a pretty massive movement into the cities and city-like suburbs.
We can see the quality of life issues with our own parents. Mine are in their 80’s now, and though they like not having to cook any more at their retirement place, they’re missing the easy metro access of their old condo. And getting to their favorite doctor means a long shuttle ride to the metro.
Of course I could be wrong– the younger generation could decide to abolish Social Security and warehouse all us indigent oldsters in the distant suburban mcmansions of today… ;>)
As much as I would like to agree with you (life-long urban dweller here), I can’t. Yes, gentrification has been slowly building since the dark days of the late 60’s/early 70’s, but not nearly enough. Also, its pace is always eclipsed by decentralization (people like to have the SFH with the yard, away from the negatives of an urban environment). In fact, I think gentrification follows this “two steps forward, one step back” movement where you have growth during boom times and then contraction back to more established areas during bust times (and sometimes these established areas were just the first to boom). Of course, gas prices and commutes will have some effect in exurban areas, but so will increased crime and disinvestment in urban areas when the economy tanks.
“Of course I could be wrong– the younger generation could decide to abolish Social Security and warehouse all us indigent oldsters in the distant suburban mcmansions of today…”
Heh, you boomers already let the gov’t ruin SS years ago. Don’t go looking for scapegoats now.
Good analogy Tommynj!
People flee the more expensive (good) urban areas as prices rise, seeking their dream SFH with back yard, away from the cons of city living. As the bust occurs, many of these people decide to move back closer to the city, and gas prices, commuting time, improved affordability, or whatever factors into their decision to get closer to things they need. Over time and as the population increases the ‘established areas’ expand, but the cycle of boom and bust continues.
On a related note, although NE prices currently make leaving a very desirable choice, and the South and semi arid places like Arizona or Nevada more desirable, each area of the country has its own pros and cons. Given the weather pattern changes in the coastal south, I think those areas will lose their desireability. Also within 10-20 years I think that the water problems in the semi arid regions, with BIG fighting among all those states for the water from the Colorado river, etc., are going to make those states very expensive to live in and therefore less desireable.
NE is not nearly as cold as it used to be. I grew up with 20-40 degrees below 0 (and one cold snap that was -80F in the late 70s. You don’t see that now except in the mountain regions. Anyway, I believe people will flock back to the northeast when the bust passes bottom. It’s just hard to figure out how exactly it will all shake down.
Gentrification in DC is hardly an idea that has been “gradually building” for 40 years in DC — or if it has, the “build” has been so “gradual” it is hardly noticeable. A few lonely souls tried to get the regentrification ball rolling, and still they sit in the expensively refurbished houses they bought 20 years ago (during the last bubble), bars on the windows, waiting for valhalla to arrive at their doorsteps and replace the winos.
waiting for valhalla to arrive at their doorsteps and replace the winos.
LOL! So true, Kathleen. Most of DC (outside of Georgetown) is a dump, and in ten years it’s going to be… a dump. Crackheads and winos have got to live somewhere and they’re not moving to McLean.
Wee bit harsh there, John. I’m the first one to invoke the crack pipe in questioning The Bubble, but let’s not go too far.
There are plenty of neighborhoods outside of Georgetown that are firmly gentrified and won’t turn back. Dupont Circle and Logan Circle come to mind. The more recently gentrified areas that are infested with over-extended borrowers and speculators are at the greatest risk.
Gentrification is not the ultimate state of every neighborhood. Sure, it does and will happen to some, but the crackheads and gang-bangers have to live somewhere.
Worse still, degentrification can also occur….
Well, in DC the crackheads and gang-bangers have been migrating to suburban Maryland for a while. Capitol Heights or Hyattsville anyone?
http://exurbannation.blogspot.com/2005/10/kunstler-hustler.html
The places with the most transit will suffer most. Degrading economies will accelerate decades long trends not reverse them.
You should check out the whole article on this one. I am not shocked that the following was written about Robert Toll:
“Robert Toll, chairman and chief executive of Toll Brothers Inc., which builds luxury homes, said in a recent conference call with analysts that the Washington market was the hardest-hit in the nation by investors who bought properties intending to flip them, and who have put the homes up for sale. “We can feel the impact of speculative play coming back into the market,” he said.”
I imagine the same “letter to the editors” that hit Florida newspapers will soon hit the Washington Post: “Its the media that is causing the downturn in the DC area. Please stop saying the housing boom is over. The Post is ruining the housing market.”
It’s articles like this, from large mainstream media outlets, that really have the potential to cause a “fast crash” scenario as opposed to the more typical slow grind to oblivion.
read the article and looks like the reporter relied a great deal on blogs in terms of where to look for data points. in some of he bubblier areas, condo prices will need to fall about 50% in value to be comprable to rent. i can’t wait to see these “flip sh*ts” get their financial heads blown off. i feel sorry for the folks like the old granny in the article who bought for a place to live. the cost of not doing homework will be very high for these people.
Stock up on Alpo while you still can.
I felt sorry for the granny too. If she wasn’t in a state to do her homework, where were her kids to look out for her?
“”It’s a lot of work and I don’t see the returns anymore,” he said. “I’m going to the table to cash my chips in.”
When he gets to the table there’ll be a sign saying “This Housing Casino Closed For Good.”
From article…
David Bath, a retired dentist in Reston, rode the boom up. A condo he bought in Vienna for $97,000 sold for $250,000 in a single day. He was able to sell another condo in Herndon for an even bigger profit.
Now he wants out. He has had no luck finding buyers for two investment houses and a four-unit apartment building he owns in Florida. He has been stuck making mortgage payments on vacant houses that took a lot of time and money to repair.
“It’s a lot of work and I don’t see the returns anymore,” he said. “I’m going to the table to cash my chips in.”
—————————————————————–
Instead of taking his profits he has dumped it into more properties with greed taking over the his sanity of doing actual market analysis…
His name definately fits… David has been taking a Bath filled with bubbles and he is about to drowned…
I read a post one time in which someone recalled that in their MBA classes the professor would ask if we have a bad investment, who would we sell it to? And the class would shout back, “DOCTORS!!!”
“And if it’s a really, really bad investment?”
“DENTISTS!!!”
They’re notoriously foolish with money.
“They helped send prices soaring at unprecedented rates. And now many are trying to sell, or rent at a loss. Some may eventually dump properties at low prices to get rid of them. That could weigh down values for everyone.”
Renting at a loss is an unsustainable strategy in a falling market. Sell sooner and help clog the theater exit as the fire starts to fill the air with smoke. Sounds like a great time to invest in housing!
Interesting how the article on speculators in “Washington” did not cite a single example of a specultor in Washington DC proper. Many condos in DC “prohibited” investors from getting in.
Could DC be immune to this aspect of the bubble?
http://www.dcbubble.blogspot.com
LOL! Ok I give up - DC is different
I wish I’d met DCBubble before I sold my place in Dupont…I feel like such a fool…..
The Washington Post points out that Credit Suisse First Boston and Economy.com dont see major risk in DC. Btw, I am not a real estate agent, nor am I in the real estate business.
http://dcbubble.blogspot.com/2006/04/dc-market-overvalued-so-what-nearly.html
That is an excellent point. Typical media, just like when housing prices were rising they site supposed “facts” with little to nothing to back it up.
On another point, for those that think of the huge commutes for people living in Loudon, think again. Most in Loudon work in reston for defense contractors or at AOL, verizon/MCI. That is where the money comes from keeping the prices high and the commutes short. There are certainly some that commute, but they are by far the minority. I have about a 10 mile commute from my place into tyson’s and of all the people in the townhouses around me I am by far commuting the farthest.
On the note of median home price, it is a useless stat whether it is going up or down. It tells you what people are buying, not what housing prices are doing. The houses in my neighborhood continue to go up although there is a lot of inventory. People have learned to reduce prices from the initial asking price, but that is merely because they are to stupid to realize they can’t get 10% more than the house that sold last month, this price reduction is then used by this blog as proof that the market has collapsed.
Don’t get me wrong, I think that houses could easily come down 10% and probably should. However, the comparisons on this blog of houses to stocks are crazy. These to things could not be any more different. Also, anyone comparing this to the early 90s should consider other factors. The early 90s saw a nation wide recession and a huge cut in government spending which significantly effects the DC area. If you want to worry about a housing market collapse worry about the possibility of a recession and a reduction in government spending (elections are approaching).
sorry for the ramble in a million directions, I read often and post little so I covered what is probably to much area.
NOVA - No one here “compares” houses to stocks, per se. We do compare the irrational, mania-like behaviour of the real estate market to that of the stock market in the ’90’s. It’s the same thing, really. We’ve been over these issues ad nauseum, for months - go ahead and look in Ben’s archives.
Essentially, what you are saying is that “it is different this time.” Free advice for you and DCBubble: Never believe this. It is never “different.” Remember that simple bit of wisdom, and you shall not get burnt.
I don’t know what neighborhood you are in, but in my neighborhood in Loudoun, selling prices peaked ($460k) in Oct/Nov and are down about 5% since then . Basically, prices have been flat YOY.
Sure, there are some dummies with high *asking* prices, but those $500k asking prices are eventually reduced to around $440k. I’m not sure what the latest sales prices are (as the March sales haven’t shown up in the system), but as of February months ago, they were selling for $420k.
Loudoun County inventory April 23, 2005: 943
Loudoun County inventory April 23, 2006: 3,981
DC(thereisno)Bubble- no lie, i can think of three good friends off the top of my head who are looking to dump props in DC proper b/c they bought the hype… maybe b/c they all live in NOVA that makes it different.
From the article:
“Some developers are struggling to sell units in the face of competition from the investor-buyers who want to dump the properties. Many had sought to protect themselves against an invasion of investors for just this reason.
A National Association of Home Builders survey of builders last year found that about 52 percent of builders tried to sell only to owner-occupants, 33 percent prohibited renting the unit out during the first year after settlement, 29 percent declined to make multiple sales to people with the same last name and about 28 percent kept the right to buy back the unit at the same price if the owner sold in the first year.
But many failed to ferret out investors or could not resist the buzz of a fast sell-out when speculators flocked to purchase. A quick sales pace allowed the builders to ratchet up prices more quickly for those who got to their doors behind the early birds.”
ooh, many condos “prohibited” investors from getting in? yeah, that an easily enforceable rule. And when the buyers handed developers the big old check last summer, if the terribly honest and forthcoming buyers said, “well, yeah, i’m an investor”, then the developers shook their head and pushed the big old check away, right dcbubb?