Homes are selling in Prince William County, Virginia

From The Washington Post:

Freewheeling American capitalism may be falling out of fashion on Wall Street, but in the western suburbs of Northern Virginia, it is driving one of the greatest home-buying sprees the region has ever seen.

The epicenter of the boom is Prince William County, where enterprising investors are scavenging the wreckage of the housing bust at a furious pace. Last month, 1,116 homes were sold in the county, a 235 percent increase from the same period last year and more than in any other September on record, according to the Northern Virginia Association of Realtors.

The buying frenzy is the silver lining of a staggering decline in home values. With banks choking on a glut of empty, foreclosed properties, the median sale price for detached single-family houses in Prince William plunged 41 percent in the past year, from $405,000 to $239,900. ...

Nowhere else in the region has the drop in prices and surge in sales been so extreme. ...

Much of the dealmaking has been led by investors, according to real estate agents who specialize in foreclosed properties. Doctors, lawyers, engineers — anyone with good credit and disposable cash — are becoming part of a burgeoning class of landlords. ...

Because of the oversupply, banks are likely to continue slashing prices, dragging down property values for nearby homeowners, in order to maintain a competitive advantage over other sellers. ...

For buyers, the dizzying pool of repossessed property is not likely to dry up anytime soon.

The moral of the story: Drop prices, sell houses. It's Econ 101.