Saturday, May 19, 2007
In a cloudy real estate market, Mike Cason saw few rays of sunshine.
He and his wife, Rebecca, wanted to sell their three-bedroom townhouse in the Del Ray neighborhood of Alexandria. They paid $430,000 in 2004. They were asking $499,000.
"We were pretty apprehensive," he said. "All through the fall, we had friends in Springfield who couldn't sell their house. We watched the market. We read everything. We were hoping just to break even."
However, after just three days on the market in late March, they had five offers, one for $515,000. "This completely shocked us," he said.
In a soft market portrayed so often in bleak terms for home sellers, the Casons are in a minority: sellers who get the asking price or more. Some real estate agents say that, despite key statistics that show the slowest housing market in years, they are seeing cases of multiple bids and rising prices. These seem to be concentrated in close-in neighborhoods including Del Ray, Bethesda and Chevy Chase (both sides of the Maryland-District line) and American University Park in the District.
Real estate agent Jane Fairweather of Coldwell Banker in Bethesda, who said she has had some multiple-bid sales in recent months, said sellers are adjusting prices to reflect a more reasonable market rather than the upward price spiral of previous years.
"I think the market is soft if you don't price it right," she said. "You're now seeing probably 10 to 15 percent of the sellers out there who are going to see multiple contracts.
"Two years ago, it was probably 40 to 50 percent of the market that got multiple contracts. And the year before that and the year before that, 60 percent of the market got multiple contracts."
Economists in the Washington area have differing views of what this could mean.
Peter Morici, an economist and business professor at the University of Maryland, sees a sign of a healthier market. "It indicates while we don't have a high-volume market, we have a market that has some stability. Fundamentally, [prices] are not a lot lower than they were at the peak," he said.
But Dean Baker, co-director of the Center for Economic and Policy Research in Washington, said that he thinks the market is still weak and that real estate agents are often setting prices low to get the asking price or more.
"I think it's more a function of Realtors thinking it can move quickly. I think we're going to have a weak market for some time to come. There's a lot of air that still needs to come out of the bubble."