In a Downswing, Looking Up

Once Locked Out by High Prices, Aspiring Buyers Now Find Reason for Hope

Kristy LaLonde, who rents an apartment in Crystal City, spent the past four years "freaking out" as home prices here climbed relentlessly. She feared she would never be able to own the kind of place she had been raised to expect.

Now, she's feeling better.

A dramatically slowed housing market has disappointed home sellers and left real estate agents waiting for the phone to ring. But it has brought relief to would-be homeowners such as LaLonde, 29, a federal policy analyst, and her fiance, Gregory Daphnis, 35, a project manager for a health insurance plan.

Not long ago, they thought the best they could afford was a condominium. Last month, though, they were delighted to find they could qualify to buy a red-brick Colonial in Wheaton -- because the seller had dropped the price from $499,000 to $435,000.

"We feel like we can begin building our life together, start a family," LaLonde said. "We can move somewhere that's not temporary, with a yard, and with a neighborhood community feeling."

The Washington area remains one of the most expensive places in the nation to buy a home. Still, over the past year, as the number of available homes for sale has climbed, prices have flattened or fallen. That has propelled some buyers toward homes that had slipped beyond their reach. It has allowed them more time to shop and afforded them a greater selection. It has also made sellers much more willing to help with such things as closing costs.

The decline in prices is most evident in the District and Northern Virginia, according to figures released last week. The median price of all types of houses and condominiums sold in the District dropped 12 percent in October from the same month a year earlier, dropping from $425,000 to $375,000, according to Metropolitan Regional Information Systems Inc., the region's multiple listing service. Prices fell 6 percent in the same period in the close-in Northern Virginia suburbs, dropping to $458,850 from $490,000, according to MRIS, and were essentially flat in Montgomery County, at about $430,000. The median is the price at which half the homes cost more and half cost less.

"The shoe is on a different foot," said Diana Whitfield, an agent with Long & Foster Real Estate in Burke. "Buyers are realizing they are more in control."

Buyers, particularly the first-timers who feared they had been priced out of homeownership, are gleeful.

Susan O'Hora, 29, an operations manager in international licensing at the Discovery Channel, felt like she was running as fast as possible but still falling behind. After graduating from the University of Richmond and moving to the Washington area in 1999, O'Hora resolutely scaled the career ladder. She has more than doubled her salary, but real estate prices moved up much more quickly. The median home price in the region was $181,600 in the second quarter of 2000 and $443,000 in the same quarter of 2006, an increase of 144 percent, according to the National Association of Realtors.

"It was kind of sad to get better, better jobs and move up in my career when the progress I was making was being so outpaced by the housing market that I thought I would never be able to get anything livable," said O'Hora, who rents a studio apartment near Dupont Circle. But the recent market shift has left her "excited and optimistic" about her prospects.

"I feel like finally I might be able to get in on this," she said. "I feel relieved."