Posted by Sparkles the Destroyer on April 27, 2006 at 15:41:25:
Oh No!
http://www.washingtonpost.com/wp-dyn/content/article/2006/04/21/AR2006042101720.html
Doors Close for Real Estate Speculators
After Pushing Up Prices, Investors Are Left Holding Too Many Homes
By Kirstin Downey
Washington Post Staff Writer
Saturday, April 22, 2006; A01
Investors who sought quick profits buying and selling real estate in
the Washington region are in full retreat, dampening demand for homes,
most notably for condos.
What is becoming apparent, market watchers say, is how big a part
speculators played in the region’s real estate boom of the past few
years. Not just condominiums, but also townhouses and single-family
houses, were snapped up by investors using no-money-down financing and
non-traditional loans. They helped send prices soaring at
unprecedented rates. And now many are trying to sell, or rent at a
loss. Some may eventually dump properties at low prices to get rid of
them. That could weigh down values for everyone.
Sales of new condos fell 43 percent in the first quarter of the year,
compared with the first quarter of 2005, according to one report, and
there are almost four times as many existing condos for sale than last
year.
“We think the softness of the market is largely due to the pulling out
of investors,” said Gopal Ahluwalia, staff vice president for research
at the National Association of Home Builders. “They have not only
pulled back, they are canceling purchases.”