Help Is On the Way

Implications: Condo sales in 2006 was half that of 2005 in the Washington DC area.  Several projects have been cancelled and some developers have been driven out of business. There is an oversupply of condos in the region.

Analysis: At the micro level foreclosures are never a good thing for the individuals or companies affected.

Unfortunately at the macro level these are necessary evils if the market is to return to a stable equilibrium.

The most important recent change is buyer expectation.  The buyer is no longer expecting prices to rise.  Therefore their urgency to purchase has gone.  The only way to create urgency now is to give buyers an attractive price.