Hi, I’m Isaac Toussie, a professional residential real estate developer of many years’ experience, and I’d like to share some of my personal observations on market trends with you.  But before we dive in, let me just state for legal purposes that the following information is merely opinion, and should not be taken to be advice of any kind by anyone.  I’m just providing some insight into the business, but nothing upon which any decisions should be based.

So, with that out of the way, let’s take a look at D.C.-area markets.

Everyone knows that home sales have fell as credit’s dried up on top of an increasingly uncertain job situation for many.  Suburban D.C. has even experienced price drops of up to one hundred thousand dollars!  And that’s the general trend region-wide, with falls of around eight percent over previous years, according to publicly available government records.  The situation holds for condominiums as well.

Increases in short sales and foreclosures. Increases in properties coming on the market. But the news wasn’t all bad. After all, one man’s trash is another’s treasure. And so the glut of foreclosed properties triggered a buying spree in some places, especially among the many first-time buyers of Prince William County who finally found prices within their reach. That investors also swooped in to snap up properties is generally taken to be a positive sign, as it reflects a certain confidence in market fundamentals. Indeed, these two groups are like the proverbial canaries in a mine, traditionally signaling trends and shifts.

The District of Columbia itself has actually fared the best of all in the region, with median prices rising some eight percent. Perhaps not so surprisingly, some of the biggest increases were posted in the capital’s most tony neighborhoods, like Georgetown.

But some investors are gambling that once the tax incentives and other government assistance melts away, the banks will unload their inventory of foreclosed properties onto the market, impacting negatively on the relatively robust metro D.C. market. Indeed, it isn’t just the most astute of real estate speculators who’ve been wondering what will happen once the government removes itself from the picture. But on the other hand, foreclosed properties, as noted in the previous paragraphs, have been selling fairly briskly anyway, so it’s questionable whether banks really have set aside enormous numbers of foreclosed homes to take advantage of the government’s inevitable departure.