January 13, 2006

You Gotta Comment?!?

WINDOW OF OPPORTUNITY. DC Bubble's contrarian nature says now is a good time to give up your apartment and buy a condo, if you are a first time homebuyer looking for a studio or one-bedroom. (If its a house you are after wait. If prices fall 5% on a $300, 000 condo that's $15K. But $90K on a $900,000 house.)

1. Mortgage rates hit a three-month low, according to Bankrate.com survey conducted the week of Jan. 11. But don't count on these low mortgage rates for long. Economists predict that rates will rise closer to 7 percent by the end of the year. Rates for a 30-year fixed were 6.22% this week compared to 6.27% last week. Rates on a 5-year adjustable rate mortgage dropped to 5.82% this week from 5.86%.

2. Rents are going to start rising. With the sales market slowing and more people renting, landlords will jack up rents. Gone are the days of comfy Dupont Circle studios for less $1,000.

3. Inventory is growing so you will have many units to choose from. What's more sellers are getting nervous. Be aggressive, there is no need to pay what the owner is asking. Make an offer at 10%, below the offerred price. See what happens. You don't get it, move on to the next one.

But dont be too greedy, prices are not going to plummet. Commenting on the sales market, David Lereah, chief economist for the National Association of Realtors, said "the (housing) boom is obviously winding down." He added, "But it's important to note that it's winding down, but still to healthy levels of activity."

One Liners

HOW LOW CAN IT GO? Cushman & Wakefield calls 2005 the best year for the DC office market since 2001. The office vacancy rate hit a four-year low of 7.2%, the fifth consecutive year D.C. has outpaced other markets.

COOL DC HOODIES & TEES. Be the first to wear a t-shirt saying: "Walk Left, Stand Right," "Hill Staffers Do It On The Floor" or our fave "Hey @$$hole: Virginia Is That Way." First seen over at Rock Creek Rambler. I hate seeing all those people walking around Dupont Circle with Brooklyn tee-shirts. How 'bout a "Red Line -- Shady Grove" tee.



Daniel said...

Hey there. I'm one of the guys from DistrictTees, and I just wanted to say thanks for the support. The "Hey @$$hole" shirt is one of our favorites as well. We've got an uncensored version of that shirt we're going to let run free in the near future.

We're always open to suggestions and ideas for shirts, so send the along.

Again, thanks for letting people know we exist!

David said...

I strong disagree that "now is a good time to give up your apartment and buy a condo, if you are a first time homebuyer looking for a studio or one-bedroom"

Prices will continue to fall in the coming 2 years especially for condo units. There are huge amount under construction or owned by flippers who are trying to sell

dcbubble said...

What if you cant wait two years? The post says there is a window because rate are at a three month low and rents in DC are rising.