I think housing, especially condos, are in a bubble that could burst. I read an article on how to short the PHLX Housing stock
index with little risk. Looks like this could be a way of hedging some of your real estate risk.

http://protectedstocks.blogs.com/main/hpb/index.html

I think the bubble is deflating. I have a friend whose nice, reasonably priced at Tysons has languished on the market for about a month and a half.

Many of us had predicted that condos would be the first market hurt by any slowdown. This seems counter to the Post's reporting, but is logical to those of us who saw such a recession once before.

Makes me wonder why the development industry is throwing so much money into luxury "mixed-use" condo development right now.

The housing slowdown may come just in time to hurt plans for the condiization of Fairfax.

The Washington Post seems to be pushing the idea of a slowdown. I suspect a slower real estate market is good for the The Wash Post as it ends up generating more classified advertising - when houses sell in a couple days agents don't bother running ads.

Totally agree Burke Guy. Have you heard of the revitilization districts? It's plans to basically put a Reston Town Center/Fairfax Corner in Annandale, Springfield, Balleys Crossroads, Seven Corners and several other places. The luxury condo market is a ticking timebomb. More and more luxury condos are being built and slated to open over the next three years while there is less and less demand for these properties. Then there is the rising mortgage rates and eveyone doing interest only mortgages. By 2008 is should be very interesting

I think the article was interesting but that the Post failed on some aspects on the metro area. The Metro Area in Washington DC is at a housing shortage for all the new jobs we add. The area is leading in the nation for job growth and is some what recession proof with the federal government based here. People need to look at all angles and not panic on the market. As an agent we agree that prices have hit a high mark but everyone seem's to forget that you need a place to live and owning property is far superior then renting.

I think the article was interesting but that the Post failed on some aspects on the metro area. The Metro Area in Washington DC is at a housing shortage for all the new jobs we add. The area is leading in the nation for job growth and is some what recession proof with the federal government based here. People need to look at all angles and not panic on the market. As an agent we agree that prices have hit a high mark but everyone seem's to forget that you need a place to live and owning property is far superior then renting.

Agree DC Agent but guess what more and more people are being priced out of the current housing market. Also, interest rates are rising. These two factors are slowing the market. There will always be a supply and demand problem in DC but as prices have continued to rise exponentially less and less people are actually able to buy a place to live.

The article in the WP about development at Westfields was very, very interesting. Maybe the Dulles Corridor is not the hot market ticket....

The Bubble has POPPED!
I sold my house (a fixer upper) for $440,000 (crazy!) and the guy who flipped it is trying to sell his rushed hash-job of "fixing" the place at a grand total of $639,000. But it is too late!
I will be surprised if it goes for more than $575,000, which will still give him a profit but if the market starts sliding who knows how low she goes...

First of all, discussion of a "bubble" should be framed within a broader context -- time of year, for example, is often a contributing factor to pace of sales. Secondly, to accuse The Washington Post of pushing a bubble agenda in order to increase their classified revenues is not only offensive but ridiculous.

My older neighbor hood has many modest homes on large lots. most of the turnover I see there is due to residents who have been ther for decades, dying off. There is recently some infill on lots prviously considered unbuildable, and some homes being upsized.

I don't see any bubble, other than homes are staying on the market longer. If they don't sell, ten the bubble has burst. Otherwise, it is only inflating more slowly.