The final word on DC home sale

Posted by: Dean Foust on January 11, 2008

woodbridge.jpgLast November I posted an entry here pointing readers to an item on the Northern Virginia Housing Bubble Fallout blog, showing the asking price for a home in Woodbridge, a close-in suburb about 15-20 miles south of Washington D.C. The house had last sold in the spring of 2005 for $315,000 and was now being listed for $115,000. I posted it just to counter the spin from denialists that “Washington DC real estate never goes down.” (or that if and when it does, it only falls in waaaaaaay-out exurbs like those on the way to West Virginia. You know, not really near D.C.)

My posting was met with a fair bit of criticism from some readers like this:

“Let’s get serious. This is such an unrealistic example of what is typically happening in the market today in the metro DC area.”

“Bottom line, don’t think this will be the price it eventually sells for.”

“Think the writer needs to get a serious beating on his performance review for this one!”

"The problem with this example is the final price drop. A cape like this would probably have sold for $200K."

I actually didn't mind the comments, even those recommending that I receive a "serious beating." I prefer this blog to offer a free-wheeling exchange of views, and if it didn't, it would be pretty boring. And given that we journalists have a bigger megaphone than most Americans, I don't actually mind the personal shots--as long as they remain verbal.

I raise all of this because the author of the NOVA Bubble blog saw the comments, and made a mental note to keep checking to see if the house in Woodbridge ever did sell--and for how much. Even our NOVA blogster wondered if the price had been low-balled just to stimulate interest, and that the final sale price would be much, much higher.

The news here, as reported on the NOVA blog, is that the house did sell -- on December 17th -- for $150,000, according to the Prince William County's assessment website.

That's 52% below the property's prior sale in 2005, and was much lower than the prices Deutsche Bank had listed it at for seven months.

Your volley, readers...

Reader Comments

JanB

January 12, 2008 10:12 AM

Well, I live near Woodbridge, and whoever bought this DUMP payed about $100,000 too much if you ask me.

Someone on the Nova Blog commented that a "Cape like this" should have gone for $200....LOL!! This house is about as far from a "Cape Cod" as an Igloo. I'm sorry, but it looks like 2 different trailers were sawed in half and nailed back together....Yikes.

Even if they DEMO the whole thing and start over, which is likely the plan, it looks like it is in a neighborhood that gangs have taken over...There is so much crime happening in this area now--wouldn't touch it with a 20 ft. pole!!

Jim D

January 12, 2008 2:10 PM

HAHAHAHAHAHAHAHAHAHA!
*snort*
*chuckle*

Sorry, that was just funny.

Are there really so many "it's different here" people left? That's astonishing.

For the record, it's also different in Seattle, LA, Manhattan (but not the other boroughs, nowadays), SF, Palo Alto (but not East San Jose!), and so on.

I recommend that everyone who thinks "it's different here" study the history of housing crashes. They start in the less desirable areas, and crawl inward, until the desirable areas get hit.

Happens every time. ...And it's not "different this time", except, of course, that it's worse.

Brandon W

January 13, 2008 9:55 AM

It's 52% below the property's 2005 sale, but it's 30.4% higher than the $115k listing. I'd call it a draw. However, what they have done is cut the price to a low "start point" and let it "float" - auction style - up to it's true price point, based on supply and demand. I think what this shows is that the supply/demand price point is much lower than the current median. Until prices fall back to that level, we'll continue to see prices slowly and painfully drop; the longer sellers hold out for the higher prices, the longer and more painful this process will be.

Patrick

February 5, 2008 3:01 PM

Woodbridge close-in? ... I don't think so.

Alexandria, 22306.
Seems like nothing is selling here. On top of that, we notice there are vacant and abandoned properties. There's one house that they started (without permit) renovations, but stopped mid-renovation. Haven't seen anything happening in 6 months or so.

It looks like properties where people were, they just left. No for sale sign, nothing. Just an empty house.

It'll be a lot easier to notice in the spring when the grass starts growing again.

jason

February 9, 2008 1:32 AM

DC real estate doesn't go down. You're talking about Woodbridge. Woodbridge is not in DC, there is no metro there, and far fewer jobs than in DC metro area. The housing bubble has burst, and yet property values continue to climb in Ballston, Clarendon, and anywhere in DC. In addition, this is one property that someone obviously paid way too much for in 2005. I could just as easily find 1 property that just recently sold for way too much and make a strong counter argument to your claim. The point is there is no statistical evidence to your claim, so you can't draw any conclusions about the market overall. Unless you take a large sample of real estate transactions in the region you're interested in studying, you can't make an informed decision on the market. When you do take a large sample of properties, you'll clearly see that property values in Woodbridge are going WAY down, but property values in DC and the very nearby metro area are not going down at all. Check it out for yourself on a map... I like zillow.com

Kat

February 13, 2008 5:08 PM

Jason,

Start shopping around Prince William County to see how much "DC real estate doesn't go down". I'm looking at several houses that were bought for 500k now going for 300k. I'd say that is more "down" than "up". It is certainly a buyer's market in the 'burbs.
And yes, we are still considered to be suburbs of DC, even if we only have a VRE and not the Metro. (roll eyes)

Noelle

June 28, 2008 4:52 PM

Jason, property values and prices (more importantly) are declining everywhere, including Arlington. They just haven't started declining at the accelerated pace you see in the outlying suburbs. There are SFHs on the market for under 400k; now granted, these aren't the most desirable neighborhoods, nor are they attractive homes, but you just didn't see these prices in 2005 for much of anything. Accordingly, the nicer homes are now following suit as well. Don't even get me started on the condo market.

Miriam

February 18, 2009 7:52 AM

I recently came across your blog and have been reading along. I thought I would leave my

first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I

will keep visiting this blog very often.

Miriam

http://www.craigslistguide.info

Sally

May 21, 2009 3:52 PM

Under what possible conceivable universe is anywhere in Prince William County "Close in"?

The only "immune" areas are the close in markets. In the close in markets, prices are falling 5-10% off the 120% run up they saw 2000-2005.

The bottom is now clearly forming in places like PWC - albeit at year 2000 prices. If the bottoming is anything like the beginning of the downturn (and everything suggests it will), the close in areas will start bottoming this fall, albeit at year 2004-2005 values.

anonymous

June 24, 2009 10:05 AM

How's it looking now genius?

Sally

August 7, 2009 11:45 AM

Anon - its pretty much right on the mark, maybe even early. In close in Arlington, prices headed back up YOY in both May and June.

Honestly, this is much stronger than I thought. I thought it would just go to "0" YOY, no bounce whatsoever. I still think it will trend back to "0" but its looking increasingly clear, the bottom is now in sight.

Sally

August 11, 2009 12:30 PM

Actually, its even better than that. The lates report gave Arlington its third consecutive YOY price gain. More importantly, Alexandria, Fairfax and Loudoun reversed trends for the last 3 years and posted YOY gains too!

I dont expect every month to come in positive on a YOY basis, but this is much more than a blip. The bottom now looks to be a bit ahead of schedule.

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BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.

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