Alicia and Jeff Hennie, whose Columbia Heights condo hit the market Thursday with a $399,000 price tag, say they are prepared to wait it out, at least for a few months. Their one-bedroom unit is in the 20009 Zip code, which has the highest inventory of condos in the region. In their 64-unit building alone, two other similar condos are for sale, including an investor-owned, fully renovated unit. The couple is looking at a May 20 move-in date for a brand new condo downtown in the 20001 Zip code, another area with high condo inventory.
"We don't have to have it sold right away," said Alicia Hennie, 28, a manager at a nonprofit teen pregnancy prevention group. "But we don't want to carry two mortgages. . . . We'll see what happens."
Yikes. They better reduce their asking price now or they will be carrying two mortgages and facing declining prices. Can Alicia manage twin mortgages?
The hyped spring real estate boom is turning out to be a dud for seller's in the bubble markets across the country. The false hope's of the housing industrial complex are melting away as the snow melts from the high mountains during the summer meltdown. The great rivers of the MLS are flowing with plenty of housing inventory for sale.
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I was just out in Leesburg on Sunday to play golf at the raspberry falls development and me and my friends were commenting on the number of 4 sale signs. They're going to have a tough time moving a property out there in this market. Plus there's still a ton of new construction going on in the development and in nearby developments, which is further competition for sellers. And don't get me started on the traffic and why anybody in there right mind would want to live that far out anyway.
ReplyDelete-shelley
So here's my take on the bubble in DC and nationally, including, at the bottom, an index of recent news stories on residential RE: http://delaselva.livejournal.com
ReplyDeleteThis poor couple appears to be digging in deeper: Carry two mortgages and wait around for when they're bargaining power is even less. Another speculator is going to rent out a unit to wait things out.
ReplyDeleteConsequence: Rents will plummet which will drive asking prices even further down as renters will be in a better position to wait it out. Lather, rinse, repeat.
In the meantime, my wife is now like a kid in a candy store going to an open house, seeing prices slashed, and then going to one two weeks later to see another one slashed. It's like chumming the water.
Good thing this lady works at a non-profit, cause thats what she'll end up with when she finally sells her condo.
ReplyDeletejohn,
ReplyDeleteLOL.
It's neat to see some of the greedy flippers ride this big one all the way down.
ReplyDeleteI love stories about how some of the "reduced" listings show a $20K reduction as if that's a big deal when they bought the unit 2 years ago for $150K less. Rather than maybe mark it down by $40K and run off with a $110K profit, he'll ride it all the way down. Maybe drop it by that much in 2 more months and watch it sit again... and again...
People who root for others to have financial difficulties are true pieces of human garbage.
ReplyDeletepeople who are consumed with greed are the real pieces of garbage. Much like the people who drove the DC real estate market over the past 5 years.
ReplyDeletePeople who root for others to have financial difficulties are true pieces of human garbage.
ReplyDeleteVersus those who are quick to declare other people garbage? :-)
For one thing, these people are not helpless victims. On the contrary, in most cases they can still make a lot of money if they mark their price down more reasonably and leave quickly.
They also sought to stick buyers with hundreds of thousands of dollars in debt so they could make an easy buck on real estate. They didn't mind that the cost of housing, and indirectly goods and services, all went up so they could make their profit.
So you must be saying then that these people are pieces of human garbage... Grab and handful and jump in!
You mean like the families and professionals who have come to live and work here during the city's economic resurgence? Yeah, they should really be shot.
ReplyDelete"So you must be saying then that these people are pieces of human garbage... Grab and handful and jump in! "
ReplyDeleteNo, I mean you people who are hoping that homeowners lose their shirts. I'm sure you claim altruistic reasons, but you really are just a bunch of self-congratulating dirtbags.
Dang MSM is out to get Bryce.
ReplyDeleteJerkstore
You mean like the families and professionals who have come to live and work here during the city's economic resurgence? Yeah, they should really be shot.
ReplyDeleteFamilies and professionals can live and work here without buying homes they can barely afford because they plan to make a killing at someone else's expense later.
No, I mean you people who are hoping that homeowners lose their shirts. I'm sure you claim altruistic reasons, but you really are just a bunch of self-congratulating dirtbags.
I think most people here are self-congratulating themselves over flippers and arrogant real-estate hawks who brag about their paper profits losing their shirts. People who bought a home to live in, not flip or use as an ATM, won't lose their shirts. If they bought their home to live in the long term, say, 15 years, then they aren't negatively affected. In some ways, it's good for them because in the short term they'll see their property taxes and cost of living go down.
"Families and professionals can live and work here without buying homes they can barely afford because they plan to make a killing at someone else's expense later. "
ReplyDeleteThat's not the point. You people are rooting for people who do own these homes to lose money. It's disgusting and you should be ashamed of yourselves.
People who root for others to have financial difficulties are true pieces of human garbage.
ReplyDeleteRight. As opposed to speculators who think they're due mind-bending profits for doing nothing more than shuffling deeds around. These salts of the earth are the basis for all true prosperity, through their oh-so-productive "labor".
Few things are more entertaining than watching wannabe quick-buck artists get burned by their own greed. Cry me a fucking river about the "financial difficulties" of flim-flammers.
--sglover
You are a real moron if you think a housing collapse would only affect speculators and "flim-flammers."
ReplyDeleteAnonymous,
ReplyDeleteI am not rooting for anyone to lose money. I am however, rooting to be right. :)
Over the past 4 years, everyone has claimed that "it's stupid not to buy," or "you're dumb to throw rent money away," or "the DC market is different..." What I despise is the implication that the buyers are so smart and the renters are dumb when in reality, my friends who purchased were simply at that point in life when it made sense for them to buy.
They often times fail to note the distinction between being ready to buy coupled with getting lucky on rapid appreciation, versus investment savvy. If it were truly the latter, they would have been leveraging themselves to the hilt and would have finished cashing out last summer.
So forgive me if I enjoy a little vindication while the market moves to retract.
Having said that, I have no sympathy for the get-rich-quick flippers who sought to take advantage of the market. These are probably the same people now complaining about rising energy costs. When they're making the money everything is fine but when it's a big company, somebody must be gouging!
"I am not rooting for anyone to lose money. I am however, rooting to be right. :) "
ReplyDeleteI know, and I suspect that's true of the majority of posters on this site, as well as the blog operator. But as a working person with an investment in his home in this city, it comes off as chortling at the (yet unrealized) misfortunes of others.
I am not rooting for you to lose your job. Please do not root for me to lose the investment on a piece of property I've been slowly, but steadily, paying for with the fruit of my sweat.
I am not rooting for you to lose your job. Please do not root for me to lose the investment on a piece of property I've been slowly, but steadily, paying for with the fruit of my sweat.
ReplyDeleteWell, as you as you said please... :-)
Seriously: If you "slowly, but steadily" expect a return on your investment over the next 10 years or so, I don't think you'll be disappointed. Prices should be coming back by then.
What makes you think that you're entitled to sustained artificial appreciation though?
Indeed, it was hard to be right when so many people were asking me to jump on the pyramid because "past performance is a predictor of future results!" and "real estate never goes down! Not here!" If you jumped on that bandwagon without thinking, why should we feel sorry for you? Really? Would you feel sorry for us if real estate continued to skyrocket and we missed the boat?
Well, PK, I hope you have the decency to admit you are wrong when your predictions of doom and gloom fail (again) to materialize. All I see on this site is the conclusory assertion that there is an artificial "bubble" and a lot of people who get angry when you contradict them.
ReplyDeletei am ROOTING hardcore for all the flippers to lose EVERYTHING, and I mean EVERYTHING... their house, car, family, friends, if they decide to jump off a tall building then that would be the cherry on top. Love it!!
ReplyDeleteseriously, this whole bubble is shaking out better than i could've wished!!
the burst will impact everyone alright, prices will plummet, all the construction, finance, and real estate jobs created over the last 5 years will go away, people will be forced to live within their means, smuggness will decrease, folks will have to start working for a living.
our country will be so much the better for it.
To most recent Anonymous,
ReplyDeleteDuring the dotcom era, I knew an individual who was a complete idiot. Yet he got an awesome job with huge stock options and was worth close to a $million on paper. Again, this was a person barely 2 years out of college who didn't even understand the industry he was in. He was not worth what he was being paid and subsequently, the company, industry, and his paperworth evaporated.
I have a friend, who has basically made $100,000 per year on his Townhouse in Alexandria. He is smart and cashed out. Having said that, he did nothing to "earn" that $100,000. Inflation and wage increases did not justify it. Someone was willing to "pay" him for shuffling the deed as someone appropriately coined.
I see these two scenarios (aside from my friend's realized gain - good for him) as the same.
You contend there is no bubble. I contend that there is. I will not get angry with you for disagreeing, I just won't buy property for what I think are excessively high prices.
The discussion is about whether there exists a bubble and what the future holds. It is not about the stupidity or recklessness or overly conservative actions of owners, renters, investors and speculators.
ReplyDeleteI am sure each group has a representative number of the greedy, dumb, foolish, afraid etc. Who cares? Why wish disaster or bad fortune on anyone. What happens will happen.
Well, PK, I hope you have the decency to admit you are wrong when your predictions of doom and gloom fail (again) to materialize.
ReplyDeleteOne can only hope that doom and gloom comes.
But seriously, I think the RE bubble has caused a lot of harm as well including for consumers paying money to the banks. For every homeowner who cashed their home ATM, there's people who ate mac and cheese to make the mortgage that month.
All I see on this site is the conclusory assertion that there is an artificial "bubble" and a lot of people who get angry when you contradict them.
I think the debate is heated. At this point, most in the press now agree there's a bubble and now it's a matter of talking whether it pops or just has the air squeezed out.
I don't think this is about wanting financial ruin for homeowners. I just want 25 year olds with good jobs to have a chance to buy an entry level house without a risky mortgage like I did 10 years ago. Right not it is not possible. This market is hurting those of that age and I want it to correct itself before too many of them jump in with a risky mortgage and hurt themselves.
ReplyDeleteI also do want the know-it-all "real estate never goes down" friends of mine to be proven wrong. I don't want them to be left in financial ruin but I also will not feel sorry for them when they lose their 300k in gains.
Seeing one's judgement confirmed is gratifying to be sure. It's really not about enjoying others' pain. What is really out of order, though, is having to read anonymous posts from real estate agents/investors about the "fruit of their sweat." That's disgusting and should be deleted by the moderator.
ReplyDeletedc_too,
ReplyDeleteCouldn't have said it better my self!
While the going was great these scumbags hit hard working folks below the belt by sending housing prices skyward in this "Greatest Pyramid Scheme Ever".Now any decent earning middle income family cannot afford a median home without resorting to risky mortgages.When basic necessity like housing are getting out of reach every day, where is question of pursuit of happiness which again is supposedly one of the basic rights?
...Now these same folks are whining like Losers!
First of all, the last few sentences of the moderator's comments on the home page sound strangely like what Saddam Hussein would say if he was a housing dictator. "The rivers will flow with the vanished equity of the non-believers","The mother of all housing bubbles has just begun", etc.
ReplyDeleteSecond, it is better that the guy said "fruit of my sweat" than "sweat of my fruit".
And yes, I admit I'm in the camp of seeing speculators leave the market for good. Just because you buy a house and make $200K from sitting on it does not make you a know-it-all real estate investor. It only makes you a lucky bastard who is sure to lose it somewhere else with your trumped-up overconfidence.
"irst of all, the last few sentences of the moderator's comments on the home page sound strangely like what Saddam Hussein would say if he was a housing dictator. "The rivers will flow with the vanished equity of the non-believers","The mother of all housing bubbles has just begun", etc."
ReplyDeleteInteresting. I am not a housing dictator.
"And yes, I admit I'm in the camp of seeing speculators leave the market for good. Just because you buy a house and make $200K from sitting on it does not make you a know-it-all real estate investor. It only makes you a lucky bastard who is sure to lose it somewhere else with your trumped-up overconfidence."
Exactly. Very well said
hating "greedy flippers"
ReplyDeleteis a good thing. Whether the root cause of this massive asset bubble is crowd behavior and/or the result of poorly-conceived government incentives doesn't matter.
SPECULATIVE BUBBLES cause massive, mutated reallocations of capital and people -- I, for one, am tired of hearing so many people talk about how they just got their real estate license! -- which ultimately harm society and certain individuals or groups.
People who particularly hate bubbles also rightly fear that they'll be forced to bail out the idiots, thru the government's confiscation of their wealth thru taxes and subsequent redistribution to the fools.
So, bubble haters -- carry on your moral and righteous cause!
"People who particularly hate bubbles also rightly fear that they'll be forced to bail out the idiots"
ReplyDeleteThat reminds me: we have an "obesity epidemic" in this country. One third of our nation is overweight or obese. Little children now have Type 2 ("Adult Onset") diabetes.
Is this not another bubble, both literally and figuratively? Who is going to bail these people out and pay the looming massive healthcare costs? Healthy people.
So if any of you here are truly anti-bubbleists, then you'd better be healthy and fit, or you're a hipocrite!
Pass the Ben & Jerry's....
Huh! Those are my next door neighbors, I didn't realize they were selling! (I rent from the owners of the next unit)
ReplyDeleteThey're very nice. And they've lived there for several years--I'm not sure at what timepoint it counts as evil horrendous "flipping" as oppposed to just "this place is tiny and we've lived here a few years let's get a bigger place". That said, while the location of our place is awesome, and will be even better once the Target opens and all...and I'm pretty sure their unit is 1 bedroom + den....even still. $400K? That's crazy. (Also why I'm renting there, and not buying!!)
20009 has the highest inventory in the region, but I also bet it has the most condos in the region too. lots of condos in dupont circle, adams morgan
ReplyDeletewww.dcbubble.blogspot.com
"400K? That's crazy."
ReplyDeleteIt's not crazy, and plenty of people can afford that. Sorry to break it to you.
400K for a tiny tiny place with no parking, few building amenities, and in a neighborhood where there is still significant crime (to the point where the store underneath was held up by a guy with a shotgun, who shot the clerk? And the building has had someone mugged inside the building?)? Yeah, for that, 400K is crazy. I'm not saying no one can afford it, and I'm not saying the place doesn't have its good points (hey, I like it, I've lived there several years), but for what it is, right now, 400K is too high.
ReplyDeleteNo, it really isn't. It's $2200/month, or thereabouts. Big whoop.
ReplyDelete