Investors Cautious Over Washington Distressed Properties for Sale

Washington is currently sitting on more than $3 billion worth of distressed properties for sale. However, investors are not rushing to buy these properties as they look for more stable investments and those that will bring regular cash flow.

In addition to existing distressed real estate, the state is also looking at an additional $2.1 billion worth of properties that are foreclosed or facing foreclosures. Delta Associates revealed that these properties include those that are in bank owned home listings, empty office structures, multifamily dwellings and hotels.

Brokers stated that most investors are looking for buildings that can bring in a steady flow of tenants or renters and repo properties that can attract regular buyers. Class A office structures seem to be the main target of investors, brokers have added. This is evident in the sale of the office building of Vornado/Charles E. Smith and the high end buildings of Washington Harbor and the former base of the newspaper, Evening Star.

Real estate experts are predicting that most of these distressed properties for sale will find buyers in the coming months. They stated that there is a lot of capital available and investors are just taking their time to make decisions. They further added that, unlike a few years ago, investor interests are not on developing new properties but on already established structures with regular occupants.

Meanwhile, lenders are also playing the waiting game and not rushing to call in loans to have properties included in foreclosure auctions for sale. Market experts said that interests from foreign investors and government interventions have influenced lenders’ decision to wait it out instead of foreclosing and selling real estate off for less.

In addition, more lenders are opting to work out alternative arrangements with their borrowers. This decision, real estate observers speculated, has a lot to do with the low prices of properties which are direct results of the lack of purchase moves from buyers and investors.

Despite the fact that investors have become more selective, market experts are predicting that distressed properties for sale in Washington will soon be sold and that the distress market scenario will come to an end before the year ends.

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