WP,pg1: (D.C.) Housing Market Cooling, Data Say

[DeepModem Mom]

Housing Market Cooling, Data Say
In Washington, Sales Are Down, Inventory Is Up
By Kirstin Downey and Sandra Fleishman
Washington Post Staff Writers
Friday, November 11, 2005; A01


Lynn Edmonds and his wife, Sebnem, could barely wait to sign on the dotted line back in May when they committed themselves to pay $796,000 for a three-floor townhouse under construction in Alexandria's Cameron Station.

But since May, the sales prices for the development have fallen -- and units like the one the Edmonds bought are now being sold for $699,900. The Edmonds are facing the prospect of a $100,000 loss in value before they even walk through the front door.

"We blithely stepped into the contract, thinking it would hold its value -- but that's not the case," said Edmonds, 46, a program analyst and Air Force veteran. "I feel so stupid putting myself into it. It's real estate -- I knew on a theoretical basis that it might go up and it might go down, but now I know it on a practical level."

New data released yesterday show that in the past year, home sales in the Washington region have declined sharply, the inventory of unsold homes is up significantly, and prices have flattened and, in some cases, fallen.

The trend is most striking in Northern Virginia, where most of the region's growth has occurred, but it is evident almost everywhere....


http://www.washingtonpost.com/wp-dyn/content/article/2005/11/10/AR2005111002241_pf.html

[wakeme2008]

1. And if he walks away from it

THE BANKS are the losers.... Didn't something like Bank problems happen under Reagon's watch.. :grr:

[nothingshocksmeanymore]

3. Nope...under Bush 1 the Resolution Trust Corp was created

after the s and l debacle...that was the last time the uber wealthy effected a property grab. Of course, all those properties did go back up but people couldn't hold out

[LibDemAlways]

2. I know a couple

(both lawyers) who paid 1.5 million for a McMansion in a Southern California tract in August. They are mortgaged to the hilt - 1.3 million.

In three months prices in that tract have fallen by $200,000 - with more, no doubt on the way. Those homes sold new for $600,000 5 years ago. They hemmed and hawed for years about whether or not to move up there, and clearly chose the worst possible time.

In real estate, timing, like location, is everything.

[nothingshocksmeanymore]

4. Yeah..houses in my beighborhood were as high as 600,000

(some even more) this summer but they are now lingering on the market

[Gormy Cuss]

5. The article has good examples suggesting that the DC market is correcting

Another seller interviewed can't move a townhouse near a Metro stop even after he has reduced the price to below the appraised value. That means there's either no buyers in that range or that single family houses are competing at the same price point. Either way, not good.

The DC market catapulted in a truly spectacular fashion in the past few years so it's not surprising that it would correct in a swift and dramatic fashion.

Softness in CA seems to be more apparent in pockets of SoCal than it is up here in the SF Bay area. There are weak spots here, but no significant decrease in prices. Time on market has increased and year-to-year appreciation has slowed.

[Boomer]

6. I echo this buyer's question

"We can't figure out who -- for the life of us -- would buy a place with two doors for $400,000," said McGrath, 28.

And who would mortgage themselves up to the chin for a dump?