Reader Question of the Day

IMG_8135, originally uploaded by Prince of Petworth.

I saw the following comment in Yesterday’s GDON post:

“I must say. I thought i was buying at the lows a few months back. I saw areas I didn’t think were in my grasp and then jumped when I saw something in a location I didn’t think i would ever be able to afford back when I started paying attention to dc realestate in 2005. but now I cant help but wonder. should I have waited another 6 months. eh. who cares I like my place. but is anyone else wondering how much more things will slide. anyone out there sell for a loss yet? I have friends looking to sell a condo they bought in 2005 and they are not too happy as the question isn’t if they will sell at a loss but just how much that loss will be.”

So I’m curious – does anyone who bought in the last couple of years regret their purchase because they feel they may be able to get a better deal today? Also – has anyone had to sell for a loss?

57 Comment

  • A condo in my old development recently sold. Thanks to Kevin J. Wood’s posting on this board of recent sales, I see that it sold for about $10,000 more than what I paid in 2004 (though less than what my place was originally offered for – I bought back in the days where you had to place bids, waive contingencies, etc.)

    So I’m glad to see there’s still a little upside potential. But I guess the thing to do is remember that you’re looking for a place to live first, an investment second. I do think that if I had waited and not bought in 2004, though, I might have been able to get more for my money. On the other hand, it may have ended up being harder to get a loan. (I used a program where I only had to put 3 percent down and I have no PMI — maybe those kinds of programs are rarer now. I also no longer meet the income qualifications.)

    It’s all a trade off.

  • I don’t know why I said “old development.” I do mean the condo development in which I currently live. (though it is old, as in age.)

  • You have to also consider, what would you have done with that 20 percent down payment if you hadn’t bought a condo two years ago? My sense is that my place, which I bought nearly three years ago (maybe six months after peak, so I was able to get it below asking price) has more or less held its value — then again, my immediate surroundings have changed enormously over that time, so with that factored in, it is probably down a little based on the condo itself. But I am confident that I would have lost a LOT more had I left money in the stock market over that period of time. So I have zero regrets.

    In terms of waiting, I don’t see the point in waiting right now, at least in D.C. The development pipeline has really slowed so there will be fewer new condos coming on the market. Members of the Obama administration will be much more apt to buy in D.C. And interest rates couldn’t be lower. There will always be demand for attractive real estate close to the center of the city. On the other hand, the opposite of what I stated above also applies — if you think the stock market is due for an imminent intense rebound that will far outstrip any rebound in real estate values, might be more sensible to wait until your wealth increases before buying. Of course, that could be 2-3 years, and in the meantime you’re losing a chance to build equity and lock in insanely low interest rates.

  • I have had the same reservations recently after seeing certain prices around town. Then I remind myself that if I had waited, there was no way I would be able to get a loan without the 20% down (or close to it). So when you factor that in, I would guess the housing stock of what I could afford had I waited probably didnt change significantly. I still feel good about the DC real estate market though.

  • Vonstallin

    Do anyone feel that PW/CH needs more Condo’s? Yes? No?

  • Vonstallin is right, My vote for more condos is no.

  • buyers remorse is a big deal when it comes to realestate. its not a sweater you can take back to macys. I know that when I started looking as the market started its slide I had an offer on a house that was rejected for being too low. and I thank god every day for that. as a year later not only did I end up in a better location a good 6 blocks west for the same money but I watched that house I was denied go through two price reductions to below what I had offered before it finally sold. I wanted to go rub it in their faces but did not. That said I am the person who wrote that comment POP mentions and I do still wonder. whens the bottom gonna hit?

  • My vote is for “more housing units.” There’s a variety of places that could meet that standard. You could have more than just “upscale” condos (maybe that’s what you’re reacting to, Vonstallin) — you could have condos for moderate income people, more townhomes, etc. Stuff at different price points that could appeal to people at different stages of life (young families, single people, older folks who don’t want to bother with house maintenance any more, etc.) And if those condos come with retail space, all the better.

    There’s nothing inherently evil or wrong about condos, and it’s painting with too broad a brush to say that condos are a huge problem. Individual detached houses doesn’t make so much sense for our neighborhood from an urban planning perspective, but townhomes are certainly nice. There’s not a thing wrong with an individual detached houses either; McLean and Potomac and Arlington and Bethesda have some lovely neighborhoods.

  • We need much more upscale development if you ask me. The affordable housing guidelines that the city endorses does not work. They do not help people pay their condo fees. Or maintenance on a home that may be near 100 years old. They help people better suited for renting to buy homes. That is a lose lose for everyone.

  • We bought in May, and I’ve been watching the homes around our neighborhood and neighborhoods where we looked to see if I will end up with buyer’s remorse. So far, I still feel like we got an incredible deal and our interest rate was around 5.25 even in May. I feel like we bought the right house at the right time.

    There are more foreclosures going on the market now, of course, but in these neighborhoods they don’t tend to be in very good shape.

  • I still check my saved criteria on redfin for new listings. While I havent seen anything that makes me regret my purchase yet I feel like that day is most surely coming as things are clearly not getting better. I should stop looking at the listings all together. but I cant help myself. But what I should really do is save up another down payment and pick up a house out by H Street – Trinidad for 100 grand as an investment property. Im sure prices will be that low there soon. And the market will return eventually. DC has great infastructure and a great long term outlook.

  • (apologies if this is posted twice)

    I really want to buy and I have saved up about $30K to put down, but I’m waiting at least until next summer to see what happens. On one hand I want to see if prices come down, on the other I want to make sure that my job and the economy is ok. At the very least, there should be more to pick from. For those that do own just be happy that prices here have not corrected as much other areas, even those just outside the beltway.

    Originally I thought that with all the Alt-A loans due to reset next spring, foreclosures in the area would increase. But with the fed’s ZIRP, it looks like that has been mitigated. Of course for those that have a 3% teaser rate, with 4.5 to 5.5% be low enough? What about the loans that recast instead of reset?

    How many people will be able to get a loan, will I? The other day a commenter on the Diane Rehm show noted that most banks in DC are hesitant to give out loans as they expect prices to fall more in the district. Then yesterday I saw on that Forbes has listed DC as one of the top ten places that will experience a major decline in prices on 2009 ( But is that just the district or does that include the surrounding area?

    These are just a handful of the questions I ask myself everyday. But regardless, I don’t like where I live now, I think prices might decline more but nothing like what we see in California and I also expect prices to stay relatively flat for a long time after they do hit the bottom.

    I might also point you to another blog that is full of info and well worth your time if this subject consumes you as much as it consumes me. Which I think if it did, you’d already be reading it:

  • Vonstallin

    Christina Says:
    December 23rd, 2008 at 9:14 am

    True, thats closer to what im saying. Over Priced and somewhat small Condo’s seems to be the only thing being made.

    The new town/row houses they built on 13th and florida (near Cardoza Football Field) is a nice difference.

    I was glad to see the petworth metro project add some row houses behind the condo units.

    As far as what price range, im not sure. Im mostly talking type. Mix it up.

    The housing projects I remember in PW/CH are the Tivoli homes on Park Road (back of Giant) the mentioned Petworth Metro houses, and the row houses built on 13th st.

    I just hope they keep it the same way.
    when I say over price I dont mean high end, but adequitly priced condo’s.

  • I bought in 2005. Sometimes I kinda of freak out. But I am not going to be trying to sell in the next year or so. In the next 5, I think the market making a come back. The DC economy has always been fairly resilient and I think the development in CH, along GA Ave, and at AFRH (yeah, I know, park land, open space would have been nice) will ultimately ad vaule to the residential property. I have an affordable first and second mortgage and feel like I can weather this. In the mean time, as the princely purveyor of this space would say, I am just enjoying the “beautiful life!”

  • I bought last Fall, in Petworth, and boy has my house ever lost value. Maybe $75,000-maybe more and I got if for a good bit below the original asking price. I still like the house, but boy do I wish I’d waited. If I hadn’t put 10% down, I’d be tempted to just walk away. It seems crazy to continue paying a mortage on a place that might not recoup its value for years. I read that if you purchased a house at the height of the housing market in the late 1980s, it took about 10 years for the house to recover its original value after the slup in th early 1990s. On a positive note, it does make me much more invested in the neighborhood since I know I’ll probably be here for a while!

  • I bought in March just south of Bloomingdale for a good bit under the asking price. My house is in much better condition than my neighbors and he paid 15-20k more at the height of the boom. So far, I still feel like I got a good deal, especially w/ low interest rates and easy mortgage requirements at the time. Now, the low rates are tempting, but nobody will give you any $$$

  • @vonstallin:

    “True, thats closer to what im saying. Over Priced and somewhat small Condo’s seems to be the only thing being made.”

    Yes. I would gladly trade all the crappy granite and faux “professional” stainless steel appliances in the world for another bedroom in some of those places. Appliances are easy to replace, but you can’t build a new bedroom when you want to get married and have a kid or something.

    I’d also love to see more stuff for those of us who have “graduated” from condo life but maybe aren’t ready to take on upkeep of an older home. God bless those of you who have done tremendous work renovating your older houses; I think it’s fantastic. But I don’t know if I would have the money and smarts to do what those folks have done; I’d probably prefer to go with something newer.

  • Very cool conversation.
    My wife and i bought a “luxury condo” August 2007. We got in just at the tail end of the mortgage craze so I know I couldn’t get the same type of loan I got back then – interest only with 5% down, no PMI. It’s a 5/1 arm so we’re keeping our fingers crossed we can either re-fi or get out of it in a few years. We definitely bought it as an investment, which hurts, but the comment about how much would we have lost in the stock market is a really good arguement. We were one of the last few units in the building to be sold, so I feel like we’ve held our value reasonably well, especially net the concessions we received including the right to buy an underground parking spot for $20k in August.

    Our buyers remorse comes from the location we bought. We really like our unit and the neighbors in the building, but we’re on 14th and Girard. If we knew more about the neighborhood or even rentied in it for a year, we definitely would have picked a different building – probably the PN Hoffman building at the bottom of the hill. We didn’t appreciate the amount of violence on our block. We’ve never been truly affected by it, but when looking at our place as an investment, it seems we’ll have to re-fi into a longer term situation eventually and rent the place out.

  • Absolutely no regrets. We love our house. We bought it in May 2007 and its held its value (compared to what we paid for it). We’d looked at a lot of homes, and even though we decided on a fixer upper, it met all of our prime criteria.

    What I’d like to see is a stop to rowhouses being chopped into multiple unit residences. We have some beautiful housing stock in Park View/Petworth. It would be nice if I could still say that in 20+ years.

  • On a national level, home prices are predicted to drop an additional 10-15%. However, D.C. is an isolated case in that it’s well insulated from the housing crisis.

    Limited space + high demand = relatively stable D.C. real estate prices.

    Prices might come down a bit more but with super low interest rates right now, there are plenty of homes being sold, keeping prices high in the process.

  • I am prepared for my house to lose another 10 percent of its value in the coming year but I am not too worried because I have a rental unit in the basement. So I am bringing in a little over 12 grand a year from that, which offsets any anxiety I have over the downturn. I do also think its good for dc in the long term that our prices slump. a lot of younger people are finding things come into their grasp. I have friends that 2 years ago figured they would eventually leave town for richmond or baltimore to actually be able to acheive the dream of home ownership. now they are just saving like mad and watching the dc listings in up in coming neighborhoods. and these are people that citys need. artists and musicians etc. this town has plenty of doctors and lawyers. let people that dont make six figures have a chance to set up shop in dc.

  • Anonymous @ 11:05am:

    Lawyers don’t all earn six figures. In fact, most attorneys starting out of law school earn well under than amount. While there are some attorneys earning $150k/year out of law school, there is also a huge distribution of attorneys earning $30-50K per year initially.

    The median average salary for first-year attorneys is somewhere around $55k/year.

    I think the ‘type’ of people that the city needs are people who will contribute to the tax base. Artists and musicians are great, but they generally don’t contribute much to the city fiscally.

  • We bought in March 07, and as it was a total rehab, I bet it would still be on the market today, but for a $100k less. But, then we would have had to stay renting a crappy condo for the past year and 9 months. And I absolutely love owning this home and we’re never moving. Also we bought it from a family that had lived there for 50 years, so I don’t mind them having the extra cash. Well, I didn’t mind until my company had a round of layoffs, started slashing a benefit every month, and warned us of another round of layoffs.

  • yeah. I dont care if my house loses 100k in value and then bounces back so long as I can afford to live there in the meantime. what scares me shitless is when I see layoffs and think about the prospect of being unemployed and paying a mortgage on a house worth 100k less than I bought it for. uncool

  • in addition to the dismal news anon 10:10 posted here is some more i just came across. granted this data is across the board but I think people who keep harping on DC being insulated are in for a big surprise in the coming year.

  • I’m more concerned of the layoffs, the unemployment that ensues and the uptick in crime. I’ve seen an increase in gang activity and drunk hispanics in Columbia Heights and Mt. Pleasant. Where are the police? Property values are generally strong in DC, but any increase in graffiti, drunk harassments and any negative impact on quality of life will kill property values.

  • there has been an uptick in Drunk White People in Adams Morgan for 10 years running now and nobody has done a thing but cater to them with taxi stands and large slices of pizza!

  • Anonymous 12:04, something significant about that article is the national level of inventory. We just don’t have the high glut that other communities do, even those just outside the beltway (and most reports will lump those areas in with any “DC Metro Area” reports).

    Personally, I had three settled sales last week and I have buyers actively looking for property. Last year I was hearing a lot from people about wanting to “wait and see” if the prices go down. Now I’m talking to people who see this time as an opportunity.

    Regarding loans, we’re seeing much more use of FHA loans, which, in 2009, will require a 3.5% down payment (for 2008, it was 3%). There is 100% financing available through DC Bond. As of last conversation, BB&T was still offering 2nd trusts (no PMI) on Jumbos. The DC First Time Homebuyers Tax Credit is good at least through 2009.

    I’m gearing up for a busy Spring.

  • Anon 12:22 – that’s about the funniest thing I’ve read on this board

  • Hipchick-. agree that what dc has going for it is limited stock. although you could argue we have a pretty good lot of condos on our hands. thanks to height limits we arent looking at a glut like miami’s. But wondering if you, being in the business have noticed a different trend:
    when I so often see people on this very blog so angry about crime, trash, and stalled or at least slowing gentrification, threatening to pack up shop and head to the burbs… I wonder if DC isnt set to experience a mini “great white flight” all over again. and while the close in suburbs may not offer much relief in the way of home prices I can say for fact that i could sell my townhouse in DC tomorrow and buy 4 in gaithersburg. now of course it would be a cold day in HELL before you would ever catch me moving there. But others dont have the same hang ups as I do.So Im wondering if you are noticing people packing up and moving out or see it as a looming problem for DC

  • Well, I specialize in urban properties, so the people who seek me out are excited about living in the city. Being an avid city dweller myself…and choosing to remain here and raise my child here…my perspective is that we will continue to see people wanting to avoid long commutes, etc. As evidenced by the Prince, DC is a very walkable city and all of the things highlighted on this blog are unique to city living. I think there is a lot of momentum now, between the return of grocery stores, retail, and neighborhood businesses, as well as arts activity, that will continue to draw people in.

    The way I look at it, I also get two hours of my life back every day that I am not sitting in the car on my way back out to the ‘burbs. However, if that cold day in Hell does come for you, I still own a condo in G’burg that I’d love to get rid of.

  • I think it’s interesting that once upon a time, urban centers were considered to be a haven for immigrant communities, while the suburbs were for the majority population. Now, the majority population is coming back to the urban core, while the suburbs are getting amazingly diverse — Falls Church and Arlington and Alexandria are more diverse now than DC is, I think. It’s an interesting cycle.

  • The amount we’re saving in rent, as well as interest deductions from taxes, seems to answer the question about value in a home. I used to pay $16,800 annually in rent!

  • this post comes at the perfect time. last night my bf and i walked into our building 1/4 sold building to discover the realtor had been through, and posted the price of each available unit on its door. the mirror image of my condo is now selling for $18k less than i paid in february. it hit me pretty hard and still feel a little sick when i think about it.

    i know, the building needs to sell, and i know, these things are cyclical. i just need to focus on how much i love our place – and i really, really do – and the fact that i may not have gotten a loan if i’d waited (i only had about 12%, but great credit). i bought at a time that was good for me, and have a fixed rate i can afford. it’s going to be ok. right?

  • Anon@ 12:57: i could sell my townhouse in DC tomorrow and buy 4 in gaithersburg.

    Your townhouse must be worth an awful lot of money. Redfin currently shows 22 listings under $250k in ALL OF 20878 zip code. The cheapest townhomes I’ve seen in Gaithersburg are in the $225k range, and those are all clustered in a pretty low-rent area. You might be able to talk them down to around $200k, but unless your current townhome is worth $800k, you’re not buying 4 Gaithersburg properties any time soon.

    If you want to live in one of the ‘new urbanist’ communities (Kentlands, King Farm, Travilah Square) you’re looking at considerably more. 1BR condos in King Farm (Rockville) near the Shady Grove metro stop usually go for $300k+ (when they come to market, and that is rarely). At the moment there aren’t any properties in said development under $350k.

    Montgomery County is bloody expensive. But then I guess if you have kids you might be willing to pay more to live in arguably the best public school district in the country.

  • Vonstallin


    As far as the market goes:

    What are the more desired or sought after properties?

    Houses? or Condo’s?

    Also what are more available?

    Last question: Do you get more whom are looking for houses, but because of either shortage or price end up going towards Condo’s?

  • My house is probably worth $50K less than I paid for it at the moment, but I’m in PW for the long haul and I’m convinced the market will come back, especially once the new development around the metro is done. I’m expecting to have to wait 5 yrs or more to sell, but I should be fine staying put. On the flip side, I made a lot of money selling my condo in 2005 (bought in 2001) — you win some, lose some.

    I’m all for more housing near the metro. I don’t care if it’s condos or apartments — but I think the density is needed to support restaurants and stores. We don’t have the room for massive developments like are being built in Columbia Heights, but several more buildings would be great. Meanwhile, deeper into the neighborhood once you’re a couple blocks off Georgia Ave, there’s not any room to build much else…we’ll keep the character of the neighborhood, but at least be able to walk to buy decent groceries and go out to eat.

  • Anon5. do you live in Gaithersburg? Im gonna guess I could get plenty of houses in or in the vicinity of gaithersburg for under 200. list price is about as accurate as tax assesments these days. That said If you want to split hairs. taking you at your word I wont be able to get a house for under 200 in gaithersburg. I could probably in reality only afford 3 or 3.5 gaithersburg townhomes if I sold my dc townhome. Not sure the point in splitting hairs though. point remains the same.

  • vonstallin, my business tends toward houses, but I certainly sell my share of condos and the occasional co-op. In DC, we have a lot of people who travel frequently or are busy or whatever, and want the convenience and security of a condo. What someone buys also depends on open-ness to different neighborhoods and condition of property.

    As far as inventory, I can say that I have frustrated buyers wanting houses in certain areas and hoping that more listings come on in January.

    Regarding condos, I think the new ones that sell well now and what we’ll see in the future are more boutique-y and less vanilla. If someone is buying a condo for lifestyle (as opposed to that is what they can afford), it helps if there is something unique and style conscious about it, whether it is the space, the finishes, or an unusual feature.

  • Vonstallin

    PetworthRes Says:
    December 23rd, 2008 at 1:59 pm

    Very true….
    I was lucky enuff to get my house b4 it became hip for $125.500 in 1994. I have tons of equity and as you can see in the forum thread I made, I constanly update it to keep up with the current styles and make overs.

    I get into debates with myself to decide if i want to snatch some of that Eq out and buy a project house in PW/CH as a rental/investment propertie.


    Buy my dream House in Tenley/chevy chase area (detached with yard) and rent my row house out.

    No matter what I don’t want to sale my row house, but in the future i want to buy my semi dream house.

    I love where I live, I love working down town all my life, I love that the petworth metro is a mear 90 second jaunt from my front door.

    But I never felt that these houses where worth what everyone was paying for them.
    I’m sure the market will rebound so for those who lost a little value i wouldn’t worry but so much.

    DC is one of the more stable areas in the country. (Job and House wise). its going to take a hit of course, but not like so many other places in the country. As long as the seat of the government is here and the supporting private companies also. We will have a larger work base than other regions.

  • searching the 20886 on redfin turns up about SIXTY houses under 200. that covers gaithersburg and montgomery village. so assuming you could pick 4 for 150 a pop pretty easily. if you have a townhouse worth 600 in DC. then you could pick up 4 lovely gaithersburg properties indeed. but they will be fugly.

  • Anon @ 2:06: Yes, I do live in Gaithersburg. And I have been actively looking to buy a property for over a year now, so I have a pretty idea of home values in this area. First of all there are no ‘houses’ – i.e. SFRs – in Gaithersburg near the $200k price point. There are townhouses in the $225k-$235k range, which you could probably get for as little as $200k. There is actually one property in 20878 listed at $194k, but as I said it’s not in the best area.

    So there are a few sub-$200k properties, but most of the $225k properties are in the Muddy Branch Giant vicinity, and personally I’d rather not live in that immediate area. It’s not that there’s a lot of violent crime or anything, just people who don’t take care of their homes. It’s a low-rent area to be sure. Also if you plan on commuting you would have to drive or take the bus to Metro (or drive downtown).

    For those of you who don’t know the Gaithersburg area too well: Most SFRs in 20878 go for $400k-$600k. SFRs in the Kentlands start at around $750k. The average condo sale price (not list price) in 20878 = $280k.

  • Vonstallin

    hipchickindc Says:
    December 23rd, 2008 at 2:22 pm

    Hey thanks….
    They guy I brought my house from (and remodels it) is in the business of buying, fixing and selling houses and He told me something similar to that.

    I was told that there is a house shortage in this part of DC, but not necessarily a Condo shortage. More people are on the market for houses vs condos. I guess this is why I made my comments in a few threads. I see homes on the market a little longer than a few years back, but they still sale in a reasonable amount of time. For now I think gone are the days of Crazy mark up on junky houses, but closer to real world prices.

  • With foreclosures and estates being priced reasonably, we’re seeing a new wave of renovation going on. The cool thing is that because investor loans are much harder to get and more expensive, they’re less likely to be cheap flips and more likely to be owner occupied rehabs.

  • I was only searching 20878, because that’s where I live. I guess I’m thinking of homes near the Red Line metro. I wouldn’t consider purchasing anything near Montgomery Village. That area is dodgy and waaay out there. One of the few places in western MoCo that actually has violent crime. Plus if you plan to buy there and work downtown you’re looking at about a 1.25-hour commute at the minimum, even with taking Metro.

    I guess you could get some places for under $200k, but again they are in undesirable locales. A good friend of mine used to live in those townhouses at Muddy Branch, and she hated it. Lots of domestic disturbances and what not.

  • I never know there was a downtown gaithersburg. but thats good if these once sprawling suburbs are building up instead of out and trying to make walkable communities. good for them

  • @emma d.

    It’ll be okay. If it helps, look at it this way: an $18k reduction on your place would mean that you’d be paying about $113 less month (assuming an interest rate of 6.5 percent on a 30-year mortgage, and not taking into account PMI and stuff like that.)

    Now, $113 is not chump change! But it’s probably not a total deal breaker for you, when you think of it amortized out like that.

  • No regrets. I bought in April 2005, the busiest month of the boom. Just refinanced last week, my house appraised for more than I paid. Additionally, the comps were not as nice as my house, but still sold for more than I bought mine for – all in the last 90 days. My take is that the condo market is seeing losses, but the townhouse/housing market is holding.

  • Anonymous 2:44, not to get too far off topic, but Old Town Gaithersburg has been around since the town was founded. There is a train station there (MARC), as well as shops and restaurants. When we lived there, on Friday nights in the summer, my daughter and I could walk to the band shell in front of City Hall and see free concerts. As far a ‘burbs go, it was a nice place to live.

  • thanks, christina, it does help to think about it that way. and i got a much lower interest rate than in your calculation, which makes the savings even smaller i think? at any rate (haha), i appreciate your response.

  • Can we stop talking about Gaithersburg?

  • Vonstallin

    RCR Says:

    December 23rd, 2008 at 3:53 pm
    Can we stop talking about Gaithersburg?



  • Comparing Gaithersburg to the advantages of being inside the beltway, I pick the city DC for that its blessed with public transportation, blessed with the social services safety net for those less fortunate, all this talk about Gaithersburg, known for many years as Cow Town, for it is not the same out there.

  • Before 2000, did anyone really talk about their house as being an “investment” vs. a home. IMO, if you bought a house you want to call home and live in for at least 5-7 years, then you made the right decision (assuming you avoided the various exotic traps such as IO, ARM, No Doc etc and got yourself a nice plain vanilla 30 year fixed). It is your home. To paint and plant flowers and stuff like that.

    In tracking the homes in Petworth on the various sites (Redfin, Zip, Trulia), I do see a significant number of foreclosures, short sales and prices dropping anywhere from 25K to 150K. The really sad part is when you look up the tax records, most of these homes weren’t sold to people with the last name Smith or Jones, they were probably sold to the same crowd who gets screwed at the Payday loan or Rent A Center-all in the name of “consumer disclosures” in an 8 point font that only a lawyer could understand.

    People keep trying to predict the bottom, but housing cycles are long, not like popping in the bodega to buy a soda. It takes time for the data to bear the story out, and when stuff sits on the market, it takes that much longer. The houses that are priced more reasonably (mid bubble) or under 300K move in this neighborhood. Why? Because those prices are more in line with incomes period, but particularly the incomes of the people who are likely to move into a more “transitional” neighborhood.

    Petworth Res-please stop debating with yourself over the home equity line to buy investment property unless by chance you are a real estate guru. Hang on to it so you don’t eat cat food in your golden years.

  • @Curmudgeon,

    exactly what last names scream out “gullible” ? If not Smith or Jones then what other names?

  • Um, bogfrog?

    I am sure there are lots of Smiths and Jones who are gullible and bought homes with all sorts of crazy mortgages all over the DC metro area.

    The point is, in this particular area of diversity (where the names Smith and Jones may constitute 20% of the population), it is sad to see that people paid upwards of 500 and 600K in 2005 forward, and now their houses are listed at 400 and downward with a big red FORECLOSURE in the listing.

    It is not a racist statement, or an indictment of their character. It is a fact that many people for whom English is a second language were a target market for unethical brokers to sell crappy mortgages in 2005-2007. I don’t imagine that anyone, regardless of last name or language, would willingly buy a house they couldn’t afford if someone had clearly explained to them that their payment could and would rise exponentially at reset.

    2/28 mortgages were incredibly popular when the securitization market demanded more and more “safe” investments in the form of mortgage backed securities. Those 28s are just kicking in, and my guess is the combination of an unaffordable mortgage payment and a decline in house value leaves just walking away from their home the most attractive option. Go check out

  • Hipchickindc — your posts and articles are great, thanks for the input.

    We bought (first timers) in Petworth within the last 60 days and are THRILLED with our purchase. We’re in our mid 30s, make good money, yet couldn’t afford to buy a house in DC until this year (FHA turned out to be the best option for us). We’re in for the haul (7+ years). Having rented off of Logan and on Cap Hill from the mid 90s I have no doubt whatsover that time will heal all when you’re less than a mile from a metro, in NW, without a condo fee–I’ve watched it happen. Prices dip–to below there value–but they also will come back in the long term. A house is an investment and a home.

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