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]I don't think it's a "bubble" but I do think that prices are driven by 1) current inventory being low 2) low interest rates 3) a lot of people who have wanted to buy or sell in the past few years but waited.

The "bubble" will burst only if we have too much supply and not enough demand. Demand may go down once budgets are cut or interest rates go up. The question then will be, what will inventory do?

I think that with the rental market the way that it is, more people will rent out their properties, rather than sell it for less than they want to get.

I just did this recently - I didn't need the money for a down payment, so instead of selling my SFH, I rented it - for more than I pay.

I'll rent it as long as it is profitable to do so, or until I can sell it for a nice surplus.  [/quote]

The supply side is peculiar. As the DC area is notoriously slow to process foreclosures.

Also, there was a massive increase in new build permits, especially for multi-unit dwellings, in the past year. I think rents are going to become a lot more competitive over the next three years.

http://m.theatlanticcities.com/housing/2012/05/top-us-cities-new-home-construction/1935/[/quote]

Yes, but there are not a lot of places to put new building.  So those of us who own properties in desireable areas, such as on a metro, may not have to worry about new building permits.[/quote]

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