Wednesday, February 27, 2008

Foreclosures Surge in Washington Region


Foreclosures are surging in the Washington, DC area. The Washington Biz Journals reports that:


District of Columbia homeowners continued to feel the impact from the nationwide housing crisis in January, as foreclosures jumped 90 percent from the previous month, according to a market report released Tuesday.

RealtyTrac, an online foreclosure tracking firm, didn't give D.C. a state ranking in foreclosure rates, but Virginia 14th and Maryland ranked 15th.
Also reported: "In the fourth quarter of 2007, Prince George's County reported 2,732 foreclosures, the highest in Maryland." However, during the 4th quarter in Prince George's County only 1279 sold according to the MRIS. Basically, the number of foreclosures was double the number of houses that sold.

The housing bust in the Washington, DC area is far from over. This year a rising inventory of foreclosures will put significant dowarnd pressure on prices.

7 comments:

  1. With new development occurring in each of the District's core economies – office, retail, residential, education, hospitality/tourism and media/communications – investors are discovering the opportunities that DC has to offer. Washington, DC is ranked as the #2 national and #4 international investment market among foreign investors (AFIRE) and the #9 retail investment market by Marcus & Millichap. Residential investors are also discovering the appeal of the District's neighborhoods as thousands of new housing units are under construction.

    Scratch "Residential" from the above paragraph, and what are you left with? More commercial development is coming to DC in the next 5 years than the preceeding 10 years, and those 10 years were transformational by anyone's yardstick. (David Chapelle, the comedian, jokes about it on he latest special on Comedy Centeral "DC is changing, man!")

    OK, the residential market is toast. Who stands to get rich(er) from this point forward? And how will they do it?

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  2. Here is one more foreclosed property. It was a long path to get there and surely cost the bank a bunch.

    McLean Housing Bubble - Half Off & Bank Owned

    Oddly enough, my brother just sold his townhouse and he is very happy with the end result as it went for three times what he paid for it in the pre-bubble days. As a bonus, he is looking to buy a bigger house built in 2006 that is now bank owned. It has never been lived in and apparently the bank is very eager to get rid of it.

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  3. as foreclosures jumped 90 percent from the previous month,

    Ouch... CR has also been reporting on how fast Commercial has also turned South.

    Got Popcorn?
    Neil

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  4. Unfortunately, that Maryland number is not correct at 430%. I emailed the editor of the Biz Journal yesterday to inform them that they were reporting a faulty figure from RealtyTrac. Here is the problem. If you go and look at the actual data at RealtyTrac's website, their is a foot note to the 430% which states this is not neccessary correct since the area covered for reporting has changed since last years. Thus we have an apples to oranges comparision. No fault to you David, but the Biz Journal should be more careful.

    One news gets moving on the net, its hard to change.

    BTW, I've got an email into RealtyTrac trying to get their statistical data on Maryland. I'll keep you updated.

    Also last month I reported the same faulty statistic that you did on MD's foreclosure.

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  5. How valid is Realtytrack's data? If you count the foreclosure listings on Propertyshark you'll get about 50. It's quite a big difference in what those two data vendors are reporting...

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  6. I'm new to this website/blog and am very impressed. Thanks for this excellent service and your insight into the DC real estate mrkt.

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  7. The WSJ just reported that foreclosures are now skyrocketing due to homeowners deciding that their property will never recover and walking away, as opposed to homeowners being in dire straits and walking away as a last resort.

    If this is true, then some real pain is on the way soon.

    http://online.wsj.com/article/SB120424677934501611.html?mod=hps_us_whats_news

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