Reply to There is no housing bubble in the DC area so get over it

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]The Washington DC housing market is not a bubble for 3 reasons:

(1) This is a government, defense, and high-tech center. I believe we have either the 3rd or 2nd-worst traffic in the country. Everyone wants to be here, because this is where the jobs are. That puts upwards pressure on house prices, and it isn't going away any time soon.

(2) There is a TON of money running around this town. It's clearly shown by the fact that people can handle $3500-4500/month mortgage payments. And because of the level of incomes here, that's not going to change any time soon, either. As my dad said, this is as close to a recession-proof town as you'll find.

(3) Shortage of land. Every bit of unbuilt land - even small plots that are only big enough for 10-20 houses - is being gobbled up by eager builders who sell half their houses when the houses don't even exist, and will not be built until 6 months after they're sold!

In this area, we have a total seller's market. The situation may drift back and become somewhat more of a buyer's market (and I actually would see that as positive), but there's no way it's going to become a total buyer's market. I don't know how young families buy into Washington, but it really doesn't matter. SOMEONE is buying, as fast as they can![/quote]

Silly me! I forgot to put the link to that quote:

http://www.businessweek.com/the_thread/hotproperty/archives/2005/07/washington_dc_bubble.html

Oh...and the time when that particular homeowner said those words...July, 2005.

Gosh those arguments sound all too familiar, don't they? You know what the difference between 2005 and 2013 in the DC area was? At least you still had expanding federal budgets, that's stopped...so PLEASE! raise those same bullsh*t arguments to support price-to-income ratios higher than the 30 year average on a housing market ready to fall again.
[/quote]

Completely different situation with the type of loans and buyers and by 2005 the boom had already been going on for 5 years.

Todays buyers are very qualified and have a lot of extra income and savings to brunt any dips in the market. The previous glut of buyers who started the drop in prices couldn't afford their homes with continual appreciation.[/quote]

I'm sorry, but that's complete nonsense. My wife and I were approved for a $550K mortgage on a combined income of $110K, with 5% down on a conventional 30-year fixed. Highest midpoint credit score was 680. This was operated through BofA. It took them four hours to pre-approve. If that's what you're considering "very qualified" then I have to question your sanity.[/quote]

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