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Saturday, April 22, 2006
Latest Promotion for the Mica Condos
The latest promotion for the Mica Condos in downtown Silver Spring. [Click on the image for larger version]
Galaxy Condomoniums are being advertised all around Silver Spring. The building is located 8060 13th Street. The location is on the south side of downtown Silver Spring.
The condo development includes 1 and 2 bedroom units. Starting price is in the low $300s. Haaa Haa Haaa Heee Heeee!!!!!! This is Silver Spring...not Bethesda! How much do you wanna bet when the real estate company will begin to drop the prices?
Here is the web site, http://www.galaxysilverspring.com/
I don't know whether this is a new building or a conversion like MICA. I will have to do some snooping around this weekend.
Hey all condos and sellers these days are doing different things to keep themselves in front of the curve. I hardly think that is sounding desperate. If you look at what the next guy is doing and they arent doing anything then I'd be more apt to look at what this particular place has to offer.
All that money I am saving by paying rent within several blocks of this property I can buy all this crap they are offering. Maybe they need to add more crap.
well you dont have to be lured in but dont be so negative because someone has good marketing. If McDonalds has 99cent cheeseburgers as a promotion, you dont say well thats desperation. Come on! Thats called great marketing to get more people in the door. Its all a numbers game.
anonymous Hey all condos and sellers these days are doing different things to keep themselves in front of the curve. I hardly think that is sounding desperate
Reality check is needed here. No body was offering "goodies" during the pre-bubble era. I bought a townhouse in 2000. All I got was a townhouse.
I live across the street from "Mica." It looks simply like a late 70s/early 80s apartment building with fresh asphalt in the parking lot and a new sign out front. If I paid $200K plus to live there, I'd be suicidal with self-loathing.
You can't spit in Silver Spring without hitting a new condo development these days, though. Most of them actually new, and not crummy conversions. It's not surprising at all to see Mica getting desperate.
SS is a decent enough area, but Dupont or Bethesda it ain't. God Himself couldn't sell all the units that will be opening up here in the next year or so.
Another SS bubble condo alert: Midtown Silver Spring is going to be another new development with 315 super-luxury units in two 20-story buildings. Yikes!
Read about it here: http://washington.bizjournals.com/washington/stories/2006/04/03/story2.html
can't argue that there is a glut of condos on the market... but high density condos do not represent all of the housing market. (See Georgetown, Cleveland Park, LeDroit Park, etc.)
Change the name of this sad blog to "we hate condos and can't wait to rent one for slightly more than we are now paying for rent on our shabby suburban apartments"
Mike Pugh, a real estate agent with Re/Max Allegiance in Arlington, is trying to sell a condo at the Halstead for a woman he says bought it for her retirement home, then became ill and went to live with family.
If she bought at the top, that was her decision and she will pay for it. Will live in a free society where people are free to make dumb choices and pay for the consequences.
Some projects became particular investor magnets, and, more recently, the subject of real estate blogs criticizing speculative excesses. For example, the local Internet blog Bubble Meter focused last month on what it called "the bubblicious bench."
RE: The Post article. I can't believe so many "flippers" were/are stupid enough to actually close on these units. They can't seem to force themselves to walk on a 25K deposit - would rather take a 100K+ slow bleed.
dc_too - you hit the nail on the head. I was guilty of the same stupidity with the stock market in 2000. Got KILLED and fully deserved every bit of it. I had no business "investing" (gambling) in the dot-coms and got my lunch handed to me.
I too noticed no pricing on the website, which indicates they don't know where the market is at.
Pricing and marketing aside, did you take a look at the layouts? The design of these places is horrible. No one, repeat no one, will ever be happy about living there for more than $600 a month; at that price you would take it because the location works and it would be affordable.
Congrats on your Post mention! And the article was actually intelligent and accurate. I think the Post does that about once a decade, so you are especially privileged.
You know things are getting good when the posters complaining about "sad renters" show up. LOL. Yeah, I'm a sad renter. So sad that this weekend I don't know where to spend all my extra cash from not owning. So many sad choices. And do you know how well those extra savings have donw over the last year when invested in the right stocks? LOL. Not too sad here.
Another reason not to buy at Mica condos? -- There's a 16-story condo tower (Silver Spring Gateway) building under construction right across the street as we speak. SSG when it's finished will comprise 468 condo nits and 55k square feet of retail space.
I am an engineer who does work for a lot of developers in the DC area, and I can say with 100% certainty that there will a condo glut of epidemic proportions in the next 2 years.
If you're in the market for a condo right now.... WAIT!!! You'll have tens of thousands of reasons to thank me later.
Idiot! By buying now at the MICA you get in on the ground floor with new buildings coming in the future. Its common sense!!! I will be laughing all the way to the bank once all the new condos are here and have brought my prices up.
Do any of you all have a life or even own property? I bet not......Get a life and some money and maybe you'll happy again. Such a sad group a bitter people. Stop complaining cause you dont own anything.
Yes, you are right. As I dig into my lobster dinner tonight and have a nice glass of wine, I will deeply regret that I have not paid out far more cash than I make in a year to have the privilege of doing yard work and maintenance all day. I regret that I never had the guts and brains to have doubled my housing payment by throwing even more money at one of those great negative amortization loans. (I think that means that the more you pay, the more you owe, but my limited knowledge of New Math means I still can't understand how that is a good idea; please have pity on me for my limited math and finance skills). No doubt when I check my stock market account and see how much money I've made in the last year by putting money into stocks instead of houses, I will be saddened by the realization that net worth is never as important as holding a house in the name of the bank. Nor will I get the thrill of political participation that comes from angrily calling the county after my property taxes are up 150 percent or something. My rent increase is flat this year, and so I really can't complain to anyone.
Please, though, try to have some sympathy for me tonight, instead of your scalding tone. Remember me as my tears flow on to my tiramisu at the five star restaurant, when instead I could be eating ramen off a granite countertop after a hard day scrubbing down the three vinyl walls attached to a brick front that is no doubt worth millions.
I bought a renovated 3 story brick/brownstone rowhouse in central DC near two metro stations (red line and green line) in early 2004. The house is gorgeous, trust me on that as much as you can trust anything posted on a blog.
I also have a two-story red brick carriage house where my car is securely parked off street. The street itself is lined with luxury cars, but I like to have mine tucked into my garage.
For this beautiful slice of urban life, I paid $405K. My annual compensation is just a little north of $100K, and I'm in my 30's. I put 20% down and I have a 30 year mortgage with something like 5.5% interest. I have more than $2000 per month in disposable income AFTER paying my mortgage. My girlfried moved in with me and now the metrics are even better.
Rather than hoping/praying/wishing that the housing market is comprised of a bunch of losers teetering on the brink of bankruptcy and foreclosure, why don't you put the energy into something constructive? (seriously, that isn't a rhetorical question)
"Idiot! By buying now at the MICA you get in on the ground floor with new buildings coming in the future. Its common sense!!! I will be laughing all the way to the bank once all the new condos are here and have brought my prices up. "
Uh, how are more buildings (more supply) going to mean prices are going to go up? How is that common sense? Last time I checked, if demand was the same, and supply went up, prices went down.
Your individual story is nice. However, it is not typical of the way houses are being bought in DC (or many other parts of the country) right now. I don't remember the exact numbers, but some huge proportion of properties in the DC area that were bought last year were NOT bought with conventional 20% loans (like you described). Also, the median price of a house is now far more than its historical ratios with household incomes in the DC area. So your story is atypical.
Personally, I don't really care whether I own or rent. If I do own, it would be the way you described. But every property I have seen in the last 2-3 years in the DC area (and yes, often back even further), when I crunch the numbers, it has been much cheaper to rent something comparable, even if I don't count the mortgage payment going to principle. So by my calculations, it is far better to rent and have more set aside for better investments than DC area real estate, and also my lobster dinners.
This whole thing reminds me a lot of the stock market bubble six-eight years ago. I come to sites like this to observe this fascinating human failure- the propensity to overspeculate.
To define my terms: When I say "DC", I mean the city of Washington. I don't mean Arlington, Reston, Bethesda, etc. One of my admitted pet peeves is when someone says "I'm from DC" and they really mean Gaithersburg. So, I'm talking about "DC" here and no other entity.
I do not come from any sort of privileged background by any stretch of the imagination. One thing for the doomsayers to remember is that DC is a highly educated city with a lot of "old money" floating around, even if the families themselves are from other parts of the country. DC property has been undervalued since the riots of the 60's. The city was *giving homes away* in the 1980's.
Does anyone honestly believe that a nice three story home in the middle of DC, walking distance from Union station, Downtown, three major hospitals, and the Capitol complex is *overvalued* at a price BELOW $500K?
What will the value be of living within walking and Metro access in one of the world's major cities (DC) when gasoline reaches $5 per gallon? (and I really hope that it does)
A smart buyer can find a bargains in non-trendy neighborhoods of DC. Unfortunately, most people are racists, and racism is what is keeping otherwise smart people out of DC; not overvalued housing prices.
With risks come rewards. Exurban communities like Ashburn are already strangling under the weight of their congestion, and you can't get anywhere in Ashburn without driving. Again, wait until gas hits $5 per gallon. I predict increased interest in properties in DC. Much of the city is still undervalued. Sure, buying now in DC is risky - but a smart *long term* buyer *in DC* will reap rewards down the road. I think bargains will be found in the DC condo market, and I'm going to keep my eyes peeled.
"David, it would not hurt your standing with the Post at all to write a nice email to the reporter who wrote that story. Include your contact information, but don't be pushy (not that you would). Chances are, you'll hear from them again."
Bryce, You're right about the DC thing and several of the points you make, but it's worth noting that a lot of the city services (which are by comparison to Arlington et al pretty expensive) are pretty poor. Roads are crummy, the schools are abysmal, the DMV is a nightmare, and on and on. Yes, Capitol Hill is nice, and yes there are a lot of good bargains to be had in non-trendy areas. But there is a reason that perfectly sensible people prefer to live in VA and/or MD -- they're often getting a better deal (meaning more services per dollar spent) on their local tax dollar.
I moved to DC when Sharon Pratt Kelly was mayor. I moved to suburban VA when Marion Barry was re-elected. I moved back when it was clear that a strong trend of rejuvination had been established under the leadership of Mayor Williams.
I can state with the certainty that comes from experience that the DMV in DC has improved tremendously over the last ten years. I just completed the safety and emissions testing on my car last month, and it was actually a pleasant experience. My last experience with the DMV in VA was nightmarish. The fact is that DC has a reputation which it no longer deserves. People who are "behind the learning curve" when it comes to the realities of our Nation's Capital are being caught asleep at the wheel.
The only constant in this life is change, and DC was long overdue for major change. I don't mean this in any negative way - but it is time for everyone to open their eyes and see that DC is becoming what it always should have been: a model city for the nation.
"Sensible" people refuse to live here, but they will spend the better part of their waking hours here: working at high-paying jobs, attending some of the country's best universities, enjoying world-class entertainment, dining, and cultural ameneties. About the only thing that "sensible" people in the 'burbs WON'T do here is go to sleep at night. How ridiculous is that? Very.
Yes, the public school system here is a disgrace. The private schools here are very good. The private schools here aren't exactly hurting for students. Think of all the diplomats, their families, and their support staff who live here. How many people do you think the embassy of France has stationed here? Where do they live, work, and play? DC. Extrapolate that over all the embassies and diplomatic missions here. Now think about congresspeople and senators. There is a SOLID base here that will not go away unless our society comes to an end.
Topics to look into to verify my position on this: Jim Abdo, the new ATFE headquarters, the new New York Ave. Metro station and the new offices nearby, the "New U" St. initiative and "The Duke" initiative, the prospects for the McMillian Sand filtration site, the "City Vista" development, the baseball stadium, the new convention center, the Verizon Center and surrounding neighborhoods, the public records concerning property sales for North Capital Street and H St. NE. (tons of money is already committed to bringing new *businesses* to these areas - never mind new housing), The SE neighborhood near the Marine Barracks (very positive change), heck the list goes on and on. Northrop Grumman has a brand-spanking new office complex near Anacostia!
Frankly, if you can't see all the good things that have emerged in the last eight years, you're beind the curve.
... and the roads aren't that bad. The city has been repaving like crazy and installing honest-to-god brick sidewalks in residential areas.
Besides, what difference will rough roads make when gasoline is at $5 per gallon?
(I saw a full sized Hummer in DC recently driving slowly and swerving to avoid potholes near the City Vista construction site. The Hummer had MD plates, of course...)
Bryce, Good points. And I'm certainly not advocating living in Sterling, but I live in Arlington (within the original boundary of DC, and closer to downtown than Anacostia) and we have it pretty good here too. Real, vibrant nightlife, urban services, schools, low taxes, 15 min (in traffic) to downtown, etc. You're right, the outer burbs suck, but one would not be crazy to live in a "close burb"
Agreed. If a nice old house in Arlington has a stable value of over a half million dollars (and nice old homes in Arlington *do* have stable values in that range), then a nice old house in DC is undervalued at $350k in the year 2006.
"Does anyone honestly believe that a nice three story home in the middle of DC, walking distance from Union station, Downtown, three major hospitals, and the Capitol complex is *overvalued* at a price BELOW $500K?"
500K is more than five times the median income in DC. I do not believe that Capitol Hill has always commanded such a huge premium over the median income in DC, so therefore I am not going to call 500K some sort of price floor.
I sincerely hope that you are right about DC's renaissance. I grew up in the area and love the city. And I think your point about higher gas prices is true, BUT...
1) there are many reasons why this renaissance may not work
2) more relevant to this blog, even if it DOES work, I think that that success is already "priced in"; in other words, real prices are not going to go up a lot more- they may stay the same (under the best case scenario you described), but they are already priced high enough to factor in plenty of long-term success.
What is the proper multiple of salary to spend on a home. It seems the old adage (sp?) of 2 and a half times salary applied when rates were 12%. Shouldn't 3 to 5 times salary be more appropriate today?
I looked up DC on the census website. From what I understand, the ACS estimates that DC's median income in 2004 was around 46K. So if it is now like 50K, then I think a 500K price floor for Capitol Hill means that a house there should cost 10 times the median income for DC.
I'm not sure that fits with historical ratios, but I don't know and I may be misunderstanding the data. Best of luck to all who take such risks.
Houses in Capital Hill were expensive in the '70's too - one I know of was bought for 225k - back then that was a LOT of money. Now probably worth just a bit less than one million (don't know if it would sell for that - but it's not for sale).
"SS is a decent enough area, but Dupont or Bethesda it ain't. God Himself couldn't sell all the units that will be opening up here in the next year or so."
I understand this condo is a joke and seriously overpriced (in any location) but besides that I understand Silver Spring doesn't paint the best picture in most peoples minds when they think about it, but what makes Bethesda or DuPont Circle so much better? There is no AFI, MARC, Intercity buses etc in those places, why are they leaps and bounds better than Silver Spring? What gets you so distraught when you think about Silver Spring? Could it simply all be just perception?
I was once a former resident of Springwood Apartments (now MICA Condos), and the things McWilliams Ballard put us through in the six months prior to my wife and I finally ridding ourselves of that horrible place are hard to describe. In short, it was like living in a construction site. Elderly residents had no place to sit down in the lobby due to the furniture being removed. The residents had to continually put up with 2-3 day water outages at least twice a month for the better part of three months, and the dust and debris from the construction resulted in respiratory problems for a portion of what was once our community. The building never stunk beforehand, and although admittedly not the nicest place you could imagine, it was fantastic for both its location and friendly atmosphere. Before McWilliams Ballard and MICA Condos bastardized the place in the name of trying to capitalize on the condo boom (which has since gone bust - my wife and I drove by there the other night, and it seems 100% vacant), it was quite a catch amid other high-priced apartments.
Then the construction began - resulting in plenty of noise, dust, water outages - even an explosion in the lobby! (Thanks to some bumbling contractors hired to do work on the gas lines). All efforts to contact McWilliams Ballard failed, as the woman in charge was always conveniently out of the office, and in fact, the MICA people (who had begun to set up shop during the construction) even left the premises because of all the annoyance caused by the contruction, leaving the remaining residents without recourse.
And don’t even get me started on Jason, that self-serving ignorant excuse for a man, and the principal contact for people who attended the varied open houses and condo-selling “parties” that MICA set up. What I want to say about him is best left unsaid.
There are currently multiple lawsuits and complaints filed or being filed against McWilliams Ballard, the contractors, and various other entities involved in the tragedy that is MICA Condominiums.
I was a former resident at Springwood too, and think that the developers made a miscalculation and got greedy. If they had offered residents a better deal on a purchase (their best offer was 5% on your unit "as-is", i.e., no deal at all), more residents might have purchased units and there would be fewer units to try to sell in this market slow-down.
That said, they are performing major renovations on the building, so the above complaints are unfair, because if the model units and the development plans are any indication, this should be a fine building when all is said and done. The shell of the building is solid, unlike some of the cardboard construction I've seen around the neighborhood lately (Silverton and 8045 Newell), and I always loved the spaciousness and layout of my apartment. As far as being 100% vacant, I assume that is because delivery isn't due until later this year.
The latest promotion for the Mica Condos in downtown Silver Spring.
Sorta reeks of desperation, doesn't it?
ReplyDeleteNew Bubblicious Silver Spring Condo Alert
ReplyDeleteGalaxy Condomoniums are being advertised all around Silver Spring. The building is located 8060 13th Street. The location is on the south side of downtown Silver Spring.
The condo development includes 1 and 2 bedroom units. Starting price is in the low $300s. Haaa Haa Haaa Heee Heeee!!!!!! This is Silver Spring...not Bethesda! How much do you wanna bet when the real estate company will begin to drop the prices?
Here is the web site, http://www.galaxysilverspring.com/
I don't know whether this is a new building or a conversion like MICA. I will have to do some snooping around this weekend.
They do a really good job of not showing a photo of their building from the outside there.
ReplyDeleteOr mentioning how much their condos cost.
What kind of idiot would get excited over $1500 in gift cards if they are paying 20 times that (or more) for a condo?
LOL. Of course, me assuming people aren't total blockheads is probably why I don't have as much money as those developers.
A Redskins fan
"1500 in gift card"
ReplyDeleteThat is less then 4 months of condo fees on a 1br
Hey all condos and sellers these days are doing different things to keep themselves in front of the curve. I hardly think that is sounding desperate. If you look at what the next guy is doing and they arent doing anything then I'd be more apt to look at what this particular place has to offer.
ReplyDeleteYup Yup Yup!
ReplyDeleteAll that money I am saving by paying rent within several blocks of this property I can buy all this crap they are offering. Maybe they need to add more crap.
Anyway they are not going to lure me in.
well you dont have to be lured in but dont be so negative because someone has good marketing. If McDonalds has 99cent cheeseburgers as a promotion, you dont say well thats desperation. Come on! Thats called great marketing to get more people in the door. Its all a numbers game.
ReplyDeleteanonymous
ReplyDeleteHey all condos and sellers these days are doing different things to keep themselves in front of the curve. I hardly think that is sounding desperate
Reality check is needed here. No body was offering "goodies" during the pre-bubble era. I bought a townhouse in 2000. All I got was a townhouse.
Right and the market has changed. There was no need then to do anything. Things are different now. Why be so negative?
ReplyDeleteI live across the street from "Mica." It looks simply like a late 70s/early 80s apartment building with fresh asphalt in the parking lot and a new sign out front. If I paid $200K plus to live there, I'd be suicidal with self-loathing.
ReplyDeleteYou can't spit in Silver Spring without hitting a new condo development these days, though. Most of them actually new, and not crummy conversions. It's not surprising at all to see Mica getting desperate.
SS is a decent enough area, but Dupont or Bethesda it ain't. God Himself couldn't sell all the units that will be opening up here in the next year or so.
Another SS bubble condo alert: Midtown Silver Spring is going to be another new development with 315 super-luxury units in two 20-story buildings. Yikes!
ReplyDeleteRead about it here:
http://washington.bizjournals.com/washington/stories/2006/04/03/story2.html
We should have a downtown silver spring gathering. So mmany Silver Springers.
ReplyDeleteDon't know if this was posted yet:
ReplyDeletehttp://www.washingtonpost.com/wp-dyn/content/article/2006/04/21/AR2006042101720.html
Bubble Meter mentioned in the Washington Post
Congrats!
Surprised at the comment in that article from Toll that Washington is the hardest hit in the nation by investors. Wow.
ReplyDeletecan't argue that there is a glut of condos on the market... but high density condos do not represent all of the housing market. (See Georgetown, Cleveland Park, LeDroit Park, etc.)
ReplyDeleteChange the name of this sad blog to "we hate condos and can't wait to rent one for slightly more than we are now paying for rent on our shabby suburban apartments"
Mike Pugh, a real estate agent with Re/Max Allegiance in Arlington, is trying to sell a condo at the Halstead for a woman he says bought it for her retirement home, then became ill and went to live with family.
ReplyDeleteIf she bought at the top, that was her decision and she will pay for it. Will live in a free society where people are free to make dumb choices and pay for the consequences.
From the WaPa Saturday 4/22
ReplyDeleteSome projects became particular investor magnets, and, more recently, the subject of real estate blogs criticizing speculative excesses. For example, the local Internet blog Bubble Meter focused last month on what it called "the bubblicious bench."
Congrats David!
RE: The Post article. I can't believe so many "flippers" were/are stupid enough to actually close on these units. They can't seem to force themselves to walk on a 25K deposit - would rather take a 100K+ slow bleed.
ReplyDeleteGot to know when to fold-em.
dc_too - you hit the nail on the head. I was guilty of the same stupidity with the stock market in 2000. Got KILLED and fully deserved every bit of it. I had no business "investing" (gambling) in the dot-coms and got my lunch handed to me.
ReplyDeleteI too noticed no pricing on the website, which indicates they don't know where the market is at.
ReplyDeletePricing and marketing aside, did you take a look at the layouts? The design of these places is horrible. No one, repeat no one, will ever be happy about living there for more than $600 a month; at that price you would take it because the location works and it would be affordable.
Good News today!
ReplyDeleteDoors Close for Real Estate Speculators
After Pushing Up Prices, Investors Are Left Holding Too Many Homes
http://www.washingtonpost.com/wp-dyn/content/article/2006/04/21/AR2006042101720.html
David,
ReplyDeleteCongratulations on your blog being mentioned in todays Washington Post. Keep up the good work!
David,
ReplyDeleteCongrats on your Post mention! And the article was actually intelligent and accurate. I think the Post does that about once a decade, so you are especially privileged.
You know things are getting good when the posters complaining about "sad renters" show up. LOL. Yeah, I'm a sad renter. So sad that this weekend I don't know where to spend all my extra cash from not owning. So many sad choices. And do you know how well those extra savings have donw over the last year when invested in the right stocks? LOL. Not too sad here.
A Redskins fan
Another reason not to buy at Mica condos? -- There's a 16-story condo tower (Silver Spring Gateway) building under construction right across the street as we speak. SSG when it's finished will comprise 468 condo nits and 55k square feet of retail space.
ReplyDeleteI am an engineer who does work for a lot of developers in the DC area, and I can say with 100% certainty that there will a condo glut of epidemic proportions in the next 2 years.
If you're in the market for a condo right now.... WAIT!!! You'll have tens of thousands of reasons to thank me later.
Idiot! By buying now at the MICA you get in on the ground floor with new buildings coming in the future. Its common sense!!! I will be laughing all the way to the bank once all the new condos are here and have brought my prices up.
ReplyDeleteOh and by the way, the Gateway is not 448 Condos, much less like under 200.
ReplyDeleteDo any of you all have a life or even own property? I bet not......Get a life and some money and maybe you'll happy again. Such a sad group a bitter people. Stop complaining cause you dont own anything.
ReplyDelete"Stop complaining cause you dont own anything."
ReplyDeleteYes, you are right. As I dig into my lobster dinner tonight and have a nice glass of wine, I will deeply regret that I have not paid out far more cash than I make in a year to have the privilege of doing yard work and maintenance all day. I regret that I never had the guts and brains to have doubled my housing payment by throwing even more money at one of those great negative amortization loans. (I think that means that the more you pay, the more you owe, but my limited knowledge of New Math means I still can't understand how that is a good idea; please have pity on me for my limited math and finance skills). No doubt when I check my stock market account and see how much money I've made in the last year by putting money into stocks instead of houses, I will be saddened by the realization that net worth is never as important as holding a house in the name of the bank. Nor will I get the thrill of political participation that comes from angrily calling the county after my property taxes are up 150 percent or something. My rent increase is flat this year, and so I really can't complain to anyone.
Please, though, try to have some sympathy for me tonight, instead of your scalding tone. Remember me as my tears flow on to my tiramisu at the five star restaurant, when instead I could be eating ramen off a granite countertop after a hard day scrubbing down the three vinyl walls attached to a brick front that is no doubt worth millions.
A Redskins fan
This is so ridiculous...
ReplyDeleteI bought a renovated 3 story brick/brownstone rowhouse in central DC near two metro stations (red line and green line) in early 2004. The house is gorgeous, trust me on that as much as you can trust anything posted on a blog.
I also have a two-story red brick carriage house where my car is securely parked off street. The street itself is lined with luxury cars, but I like to have mine tucked into my garage.
For this beautiful slice of urban life, I paid $405K. My annual compensation is just a little north of $100K, and I'm in my 30's. I put 20% down and I have a 30 year mortgage with something like 5.5% interest. I have more than $2000 per month in disposable income AFTER paying my mortgage. My girlfried moved in with me and now the metrics are even better.
Rather than hoping/praying/wishing that the housing market is comprised of a bunch of losers teetering on the brink of bankruptcy and foreclosure, why don't you put the energy into something constructive? (seriously, that isn't a rhetorical question)
oh, and...
ReplyDeletemy etrade accounts (brokrage, 401K, and banking) hit $106K on Friday. Another $22K are in my current employer' retirement account.
I paid $575 in federal taxes and received a $1600 refund from DC.
Now go work on your own lives rather than hoping the lives of others come unravelled in order to feel better about yourselves.
bryce -- congratulations.
ReplyDeleteI agree with you Bryce - all the way. To bragg about wasting money on lobster is ridiculous. If you can afford it - eat it. Who cares?
ReplyDeleteRent if you think that is best for you. Again, who cares?
Thanks for all the fine congratulations.
ReplyDeleteIt means a whole deal to me. I blog because of the readers. :-)
David
"Idiot! By buying now at the MICA you get in on the ground floor with new buildings coming in the future. Its common sense!!! I will be laughing all the way to the bank once all the new condos are here and have brought my prices up. "
ReplyDeleteUh, how are more buildings (more supply) going to mean prices are going to go up? How is that common sense? Last time I checked, if demand was the same, and supply went up, prices went down.
Bryce-
ReplyDeleteYour individual story is nice. However, it is not typical of the way houses are being bought in DC (or many other parts of the country) right now. I don't remember the exact numbers, but some huge proportion of properties in the DC area that were bought last year were NOT bought with conventional 20% loans (like you described). Also, the median price of a house is now far more than its historical ratios with household incomes in the DC area. So your story is atypical.
Personally, I don't really care whether I own or rent. If I do own, it would be the way you described. But every property I have seen in the last 2-3 years in the DC area (and yes, often back even further), when I crunch the numbers, it has been much cheaper to rent something comparable, even if I don't count the mortgage payment going to principle. So by my calculations, it is far better to rent and have more set aside for better investments than DC area real estate, and also my lobster dinners.
This whole thing reminds me a lot of the stock market bubble six-eight years ago. I come to sites like this to observe this fascinating human failure- the propensity to overspeculate.
A Redskins fan
To define my terms: When I say "DC", I mean the city of Washington. I don't mean Arlington, Reston, Bethesda, etc. One of my admitted pet peeves is when someone says "I'm from DC" and they really mean Gaithersburg. So, I'm talking about "DC" here and no other entity.
ReplyDeleteI do not come from any sort of privileged background by any stretch of the imagination. One thing for the doomsayers to remember is that DC is a highly educated city with a lot of "old money" floating around, even if the families themselves are from other parts of the country. DC property has been undervalued since the riots of the 60's. The city was *giving homes away* in the 1980's.
Does anyone honestly believe that a nice three story home in the middle of DC, walking distance from Union station, Downtown, three major hospitals, and the Capitol complex is *overvalued* at a price BELOW $500K?
What will the value be of living within walking and Metro access in one of the world's major cities (DC) when gasoline reaches $5 per gallon? (and I really hope that it does)
A smart buyer can find a bargains in non-trendy neighborhoods of DC. Unfortunately, most people are racists, and racism is what is keeping otherwise smart people out of DC; not overvalued housing prices.
With risks come rewards. Exurban communities like Ashburn are already strangling under the weight of their congestion, and you can't get anywhere in Ashburn without driving. Again, wait until gas hits $5 per gallon. I predict increased interest in properties in DC. Much of the city is still undervalued. Sure, buying now in DC is risky - but a smart *long term* buyer *in DC* will reap rewards down the road. I think bargains will be found in the DC condo market, and I'm going to keep my eyes peeled.
Dorothea,
ReplyDelete"David, it would not hurt your standing with the Post at all to write a nice email to the reporter who wrote that story. Include your contact information, but don't be pushy (not that you would). Chances are, you'll hear from them again."
Thanks for the advice. I did. :-)
Bryce,
ReplyDeleteYou're right about the DC thing and several of the points you make, but it's worth noting that a lot of the city services (which are by comparison to Arlington et al pretty expensive) are pretty poor. Roads are crummy, the schools are abysmal, the DMV is a nightmare, and on and on. Yes, Capitol Hill is nice, and yes there are a lot of good bargains to be had in non-trendy areas. But there is a reason that perfectly sensible people prefer to live in VA and/or MD -- they're often getting a better deal (meaning more services per dollar spent) on their local tax dollar.
I moved to DC when Sharon Pratt Kelly was mayor. I moved to suburban VA when Marion Barry was re-elected. I moved back when it was clear that a strong trend of rejuvination had been established under the leadership of Mayor Williams.
ReplyDeleteI can state with the certainty that comes from experience that the DMV in DC has improved tremendously over the last ten years. I just completed the safety and emissions testing on my car last month, and it was actually a pleasant experience. My last experience with the DMV in VA was nightmarish. The fact is that DC has a reputation which it no longer deserves. People who are "behind the learning curve" when it comes to the realities of our Nation's Capital are being caught asleep at the wheel.
The only constant in this life is change, and DC was long overdue for major change. I don't mean this in any negative way - but it is time for everyone to open their eyes and see that DC is becoming what it always should have been: a model city for the nation.
"Sensible" people refuse to live here, but they will spend the better part of their waking hours here: working at high-paying jobs, attending some of the country's best universities, enjoying world-class entertainment, dining, and cultural ameneties. About the only thing that "sensible" people in the 'burbs WON'T do here is go to sleep at night. How ridiculous is that? Very.
Yes, the public school system here is a disgrace. The private schools here are very good. The private schools here aren't exactly hurting for students. Think of all the diplomats, their families, and their support staff who live here. How many people do you think the embassy of France has stationed here? Where do they live, work, and play? DC. Extrapolate that over all the embassies and diplomatic missions here. Now think about congresspeople and senators. There is a SOLID base here that will not go away unless our society comes to an end.
Topics to look into to verify my position on this: Jim Abdo, the new ATFE headquarters, the new New York Ave. Metro station and the new offices nearby, the "New U" St. initiative and "The Duke" initiative, the prospects for the McMillian Sand filtration site, the "City Vista" development, the baseball stadium, the new convention center, the Verizon Center and surrounding neighborhoods, the public records concerning property sales for North Capital Street and H St. NE. (tons of money is already committed to bringing new *businesses* to these areas - never mind new housing), The SE neighborhood near the Marine Barracks (very positive change), heck the list goes on and on. Northrop Grumman has a brand-spanking new office complex near Anacostia!
Frankly, if you can't see all the good things that have emerged in the last eight years, you're beind the curve.
... and the roads aren't that bad. The city has been repaving like crazy and installing honest-to-god brick sidewalks in residential areas.
ReplyDeleteBesides, what difference will rough roads make when gasoline is at $5 per gallon?
(I saw a full sized Hummer in DC recently driving slowly and swerving to avoid potholes near the City Vista construction site. The Hummer had MD plates, of course...)
Bryce,
ReplyDeleteGood points. And I'm certainly not advocating living in Sterling, but I live in Arlington (within the original boundary of DC, and closer to downtown than Anacostia) and we have it pretty good here too. Real, vibrant nightlife, urban services, schools, low taxes, 15 min (in traffic) to downtown, etc. You're right, the outer burbs suck, but one would not be crazy to live in a "close burb"
Agreed. If a nice old house in Arlington has a stable value of over a half million dollars (and nice old homes in Arlington *do* have stable values in that range), then a nice old house in DC is undervalued at $350k in the year 2006.
ReplyDelete"Does anyone honestly believe that a nice three story home in the middle of DC, walking distance from Union station, Downtown, three major hospitals, and the Capitol complex is *overvalued* at a price BELOW $500K?"
ReplyDelete500K is more than five times the median income in DC. I do not believe that Capitol Hill has always commanded such a huge premium over the median income in DC, so therefore I am not going to call 500K some sort of price floor.
I sincerely hope that you are right about DC's renaissance. I grew up in the area and love the city. And I think your point about higher gas prices is true, BUT...
1) there are many reasons why this renaissance may not work
2) more relevant to this blog, even if it DOES work, I think that that success is already "priced in"; in other words, real prices are not going to go up a lot more- they may stay the same (under the best case scenario you described), but they are already priced high enough to factor in plenty of long-term success.
A Redskins fan
What is the proper multiple of salary to spend on a home. It
ReplyDeleteseems the old adage (sp?) of 2 and a half times salary applied when rates were 12%. Shouldn't 3 to 5 times salary be more appropriate today?
I looked up DC on the census website. From what I understand, the ACS estimates that DC's median income in 2004 was around 46K. So if it is now like 50K, then I think a 500K price floor for Capitol Hill means that a house there should cost 10 times the median income for DC.
ReplyDeleteI'm not sure that fits with historical ratios, but I don't know and I may be misunderstanding the data. Best of luck to all who take such risks.
A Redskins fan
Houses in Capital Hill were expensive in the '70's too - one I know of was bought for 225k - back then that was a LOT of money. Now probably worth just a bit less than one million (don't know if it would sell for that - but it's not for sale).
ReplyDelete"SS is a decent enough area, but Dupont or Bethesda it ain't. God Himself couldn't sell all the units that will be opening up here in the next year or so."
ReplyDeleteI understand this condo is a joke and seriously overpriced (in any location) but besides that I understand Silver Spring doesn't paint the best picture in most peoples minds when they think about it, but what makes Bethesda or DuPont Circle so much better? There is no AFI, MARC, Intercity buses etc in those places, why are they leaps and bounds better than Silver Spring? What gets you so distraught when you think about Silver Spring? Could it simply all be just perception?
I was once a former resident of Springwood Apartments (now MICA Condos), and the things McWilliams Ballard put us through in the six months prior to my wife and I finally ridding ourselves of that horrible place are hard to describe. In short, it was like living in a construction site. Elderly residents had no place to sit down in the lobby due to the furniture being removed. The residents had to continually put up with 2-3 day water outages at least twice a month for the better part of three months, and the dust and debris from the construction resulted in respiratory problems for a portion of what was once our community. The building never stunk beforehand, and although admittedly not the nicest place you could imagine, it was fantastic for both its location and friendly atmosphere. Before McWilliams Ballard and MICA Condos bastardized the place in the name of trying to capitalize on the condo boom (which has since gone bust - my wife and I drove by there the other night, and it seems 100% vacant), it was quite a catch amid other high-priced apartments.
ReplyDeleteThen the construction began - resulting in plenty of noise, dust, water outages - even an explosion in the lobby! (Thanks to some bumbling contractors hired to do work on the gas lines). All efforts to contact McWilliams Ballard failed, as the woman in charge was always conveniently out of the office, and in fact, the MICA people (who had begun to set up shop during the construction) even left the premises because of all the annoyance caused by the contruction, leaving the remaining residents without recourse.
And don’t even get me started on Jason, that self-serving ignorant excuse for a man, and the principal contact for people who attended the varied open houses and condo-selling “parties” that MICA set up. What I want to say about him is best left unsaid.
There are currently multiple lawsuits and complaints filed or being filed against McWilliams Ballard, the contractors, and various other entities involved in the tragedy that is MICA Condominiums.
Be advised.
I was a former resident at Springwood too, and think that the developers made a miscalculation and got greedy. If they had offered residents a better deal on a purchase (their best offer was 5% on your unit "as-is", i.e., no deal at all), more residents might have purchased units and there would be fewer units to try to sell in this market slow-down.
ReplyDeleteThat said, they are performing major renovations on the building, so the above complaints are unfair, because if the model units and the development plans are any indication, this should be a fine building when all is said and done. The shell of the building is solid, unlike some of the cardboard construction I've seen around the neighborhood lately (Silverton and 8045 Newell), and I always loved the spaciousness and layout of my apartment. As far as being 100% vacant, I assume that is because delivery isn't due until later this year.