David Lereah's Condo Investment Goes Bust
David Lereah has invested in multiple condos in the Washington, DC area as well as in some undisclosed(s) location in bubblicious Florida. One of his investment properties is located at
4551 Strutfield Ln, Alexandria, VA.
Alexandria, VA is an inner suburb of Washington, DC. Mr. Lereah's condo unit is located at the PALAZZO AT PARK CENTER. Mr. Lereah does not live there. This is an investment property and not his primary residence.
He bought the 1br 1bth condo on April 1st, 2005 (April Fools day, How appropriate!) for $276,900 and includes 1 parking spot. It is a recently built garden style building. The condo units has 726 sq. feet. (Source: Alexandria, VA Real Estate Assessments Database)
Here is the price chronology of the condo unit:
2005: Property Assessment: 245,700
April 2005: David Lereah Buys Unit for 276,900
2006: Property Assessment: 271,500
2007: Property Assessment: 248,977
Under Virginia law, property assessment are valued to be at "100 percent of fair market value. The Virginia Supreme Court has provided the following definition of fair market value: The fair market value of a property is the price which it will bring when it is offered for sale by one who desires, but is not obliged, to sell it, and is bought by one who is under no necessity of having it."
Mr. Lereah bought the condo unit for $276,900 in April 2005. In 2007 the condo was assessed at $248,977 which is a loss of $27,923. This represents a price decline of 10% (nominal dollars).
It is fitting to see the drop in value of David Lereah's Alexandria condo. He bought just a few months away from the peak bubble in the Washington, DC area. Mr. Lereah clearly made a bad investment decision.