More Big Red Words

On March 20, I posted about not holding my breath for a Toll Brothers' development in Warrenton (Fauquier County).

It's now "OPENING SUMMER 2007!"

In other homebuilder news today, Moody's cut Hovanian and Beazer further into junk territory, and Hovnanian reported a third straight loss.

"The housing market weakened in the latter part of the second quarter and the slower conditions have continued into May." [CEO Ara Hovnanian] also said the company won't give earnings forecasts anymore because housing market conditions have become increasingly uncertain."

On Tuesday, NVR was downgraded by Bank of America. Analyst Daniel Oppenheim's reasoning (from AP):

NVR makes more than half of its revenue and nearly three-quarters of its profits in Washington and Baltimore, Oppenheim said. He expects home sale in those markets to worsen and NVR's margins to fall.

"Our May survey pointed to a 4th straight month of weak traffic in D.C., after improvement from November to January," he said. "In 2005, similar weakening trends in Washington preceded a 28 percent decline in the stock." He added the company to his "least favorites" list of home builders.

Old Post:

COMING SPRING 2007!

Warrenton Chase is Fauquier County's most spectacular new community of luxury single-family homes on 1/2-acre home sites, nestled among the gentle rolling hills of Virginia countryside. This exciting new community, just minutes from downtown Warrenton, features miles of hiking & biking trails, hundreds of acres of open space, neighborhood Recreation Center with a swimming pool and tot lots.

I've been watching the seasons and the big red statement change through the past year. First it was COMING SPRING 2006! Then COMING SUMMER 2006! Fall 2006! Winter 2007!

Our Favorite Prognosticator Strikes Again

WTOP radio here in D.C. this morning quoted Stephen Fuller (GMU Center for Regional Analysis) as saying the region's housing market was "tipping in favor of the sellers." There were no qualifiers on the remark, as far as breaking down the whole region into counties.

I'm sure the sellers in Prince William county, with over a year's worth of inventory, are thrilled to hear that.

Oh, and the 10-year-treasury note yield is today the highest it's been this year.

Does anyone really believe this?

Frightful Forecast for Region's Housing Market
May 30, 2007 - 3:48pm

Adam Tuss, WTOP Radio

WASHINGTON -- The forecast for the future of the region's housing market is in -- and it looks outrageous.

If current trends continue, by 2057, the average home in the D.C. area is likely to cost more than $14 million, says Stephen Fuller, director of the Center for Regional Analysis at George Mason University's School of Public Policy.

Even more frightening is the fact that the numbers are based on the current market, taking into account the trend of home prices generally doubling every 10 years and growing by about 7.2 percent annually.

"It will take more than 11 times the average annual income to afford a home," Fuller says. "This will be a totally unaffordable region."

"We're Going To Have To Save Our Pennies"

For a long time, Paul and Amy Woodhull's house on Capitol Hill was a honey pot. Through multiple refinancings over nearly a decade, they pulled out money to fix it up, buy a car, pay down credit cards, buy three other properties and improve them, too.

Now the pot is dry. The Woodhulls are feeling squeezed by bills, but with interest rates up and home prices down, they're reluctant to touch their home equity again. They called their six children into a family meeting recently, and Amy laid down new rules: No more impulse purchases or frivolous shopping trips. "We're going to have to save our pennies," she declared.
. . .
Homeowners gained an average of nearly $1 trillion a year in extra spending money from 2001 through 2005 -- more than triple the rate in the previous decade -- according to a study by former Federal Reserve chairman Alan Greenspan and Fed economist James E. Kennedy. That's the "free cash," as the authors call it, left over after closing costs and other fees deducted from equity withdrawals.

Most of the money extracted during those boom years, nearly two-thirds, came from home sales, the authors found. Another 21 percent came from home equity lines of credit, while 15 percent came from mortgage refinancings.

About a third of the free cash gained during this period was used to buy other homes, they calculated. About 29 percent was used to acquire stocks and other assets. About 12 percent went to home improvements. And nearly a fourth, 23 percent, went to consumer spending, including paying credit card bills and reducing other non-mortgage debts.

The amount of free cash extracted has fallen sharply since the peak in 2005, to $217 billion in the last three months of 2006, down by almost half from a peak of nearly $400 billion in the third quarter of 2005. Analysts disagree about whether these changes will affect consumer spending.

When consumers stop spending, the big "R" word comes to mind.

Watch Out For Upside-Down Landlords

On April 30, I wrote about first-hand knowledge of a renter whose house was heading into foreclosure without her knowledge. (That renter has found another property and is doing well).

The Times-Community newspaper today has a similar tale:

Tracey Marty does not own a home but she is still feeling the effects of the recent surge in home foreclosures.

Marty is a registered nurse at Inova Fairfax Hospital. She was profiled in the Times-Mirror's recent Living on the Edge series about residents struggling to make ends meet in the wealthiest county in the nation.

Marty, 39, is a single mother with lupus, a chronic autoimmune disease that leaves her aching "all over." The symptoms worsen when she's stressed or overworked. Right now, Marty is both.

This month she found out through a legal advertisement in a newspaper that a bank was foreclosing on the Leesburg town house she has been renting since Christmas Day, forcing her and son Nicholas to move again.

Property records show that Leonard Rowitz and Carlos Desouza bought the town house in 2004 for $295,000. The county last assessed it at $334,500.

On May 25, an auctioneer sold the foreclosed property to a local real estate agent from Caldwell Banker for $245,814, $1 above the asking price.

With investors buying up property during the robust market of two and three years ago, Marty's circumstance shows that renters are now becoming the unwitting victims of the recent upturn in home foreclosures.

Statewide, according to RealtyTrac.com, the number of foreclosures during the first three months of 2007 rose 140 percent from the same period in 2006.

About that last RealtyTrac number: the Washington/Arlington/Alexandria MSA was up 304.33% in the first quarter of 2007.

Prince William County Same-House Sales

768 AYRSHIRE LN
WOODBRIDGE, VA 22191
List Price: $389,900
Prior Sale: $529,000 6/3/2005
Listing Date: 05/25/07
-26.3%

708 VESTAL ST
WOODBRIDGE, VA 22191
List Price: $405,000
Prior Sale: $535,000 8/16/2006
Listing Date: 03/04/07
-24.3%

8840 SONG SPARROW DR
GAINESVILLE, VA 20155
List Price: $472,500
Prior Sale: $610,000 11/7/2006
Listing Date: 05/23/07
-22.5%

15321 DILLWYN CT
WOODBRIDGE, VA 22193
List Price: $579,900
Prior Sale: $745,000 2/24/2006
Listing Date: 05/25/07
-22.2%

8962 JUNCO CT
GAINESVILLE, VA 20155
List Price: $449,000
Prior Sale: $571,590 2/10/2006
Listing Date: 05/25/07
-21.4%

5631 WHEELWRIGHT WAY
HAYMARKET, VA 20169
List Price: $389,900
Prior Sale: $489,900 7/5/2005
Listing Date: 01/11/07
-20.4%

14921 SIMMONS GROVE DR
HAYMARKET, VA 20169
List Price: $639,900
Prior Sale: $799,900 12/2/2005
Listing Date: 05/24/07
-20.0%

14413 PARULA WAY
GAINESVILLE, VA 20155
List Price: $429,900
Prior Sale: $530,190 1/4/2006
Listing Date: 05/24/07
-18.9%

7700 WELL ST
MANASSAS, VA 20111
List Price: $339,900
Prior Sale: $405,000 12/21/2005
Listing Date: 05/24/07
-16.1%

10032 PENTLAND HILLS WAY
BRISTOW, VA 20136
List Price: $415,000
Prior Sale: $494,000 10/13/2005
Listing Date: 05/24/07
-16.0%

7923 MEADOW CT
MANASSAS, VA 20109
List Price: $245,000
Prior Sale: $290,000 9/20/2005
Listing Date: 02/16/07
-15.5%

10650 MEADOW GROVE CT
MANASSAS, VA 20109
List Price: $252,900
Prior Sale: $295,000 8/30/2005
Listing Date: 03/27/07
-14.3%

16614 RESERVOIR LOOP
DUMFRIES, VA 22026
List Price: $399,999
Prior Sale: $465,000 4/15/2005
Listing Date: 02/02/07
-14.0%

17501 CAJUN CT
DUMFRIES, VA 22025
List Price: $441,000
Prior Sale: $510,000 4/13/2006
Listing Date: 02/24/07
-13.5%

14815 ALABAMA AVE
WOODBRIDGE, VA 22191
List Price: $355,000
Prior Sale: $410,000 8/7/2006
Listing Date: 04/23/07
-13.4%

18899 MIATA LN
TRIANGLE, VA 22172
List Price: $469,900
Prior Sale: $542,138 2/8/2006
Listing Date: 05/23/07
-13.3%

15074 GAFFNEY CIR
GAINESVILLE, VA 20155
List Price: $330,000
Prior Sale: $379,000 4/29/2005
Listing Date: 05/23/07
-12.9%

7196 HALL TAVERN CT
MANASSAS, VA 20112
List Price: $423,900
Prior Sale: $486,000 4/14/2005
Listing Date: 09/04/06
-12.8%

8009 TOWERING OAK WAY
MANASSAS, VA 20111
List Price: $524,900
Prior Sale: $600,000 11/28/2005
Listing Date: 05/25/07
-12.5%

14788 TAMARACK PL
WOODBRIDGE, VA 22191
List Price: $237,500
Prior Sale: $265,000 4/18/2007
Listing Date: 03/13/07
-10.4%

3478 AVIARY WAY
WOODBRIDGE, VA 22192
List Price: $323,900
Prior Sale: $354,800 6/13/2006
Listing Date: 04/18/07
-8.7%

9588 MANASSAS FORGE DR
MANASSAS, VA 20111
List Price: $429,900
Prior Sale: $469,850 1/4/2005
Listing Date: 03/28/07
-8.5%

4003 LAUREL ST
DUMFRIES, VA 22026
List Price: $460,900
Prior Sale: $496,575 9/1/2005
Listing Date: 12/20/06
-7.2%

16962 HORTON CT
DUMFRIES, VA 22025
List Price: $589,900
Prior Sale: $626,970 10/3/2005
Listing Date: 05/24/07
-5.9%

11600 TOLSON PL
WOODBRIDGE, VA 22192
List Price: $349,900
Prior Sale: $370,000 6/30/2006
Listing Date: 01/22/07
-5.4%

Summer Bummer

Memorial Day is over (I'm sure you noticed), and for me that has always signified the start of summer. It's the beginning of the quiet news and real estate seasons as well.

Each day I like to check Loudoun blogger/agent Merv Forney's "Northern Virginia Real Estate Guide" for the latest on Fairfax, Loudoun, and Prince William Counties' "market indicators". The box is located at the top middle-column.

It appears as though inventory is, like last summer, outpacing sales. Prince William County has 15 months of inventory.

Those sellers who refuse to "just give it away" will probably withdraw their listings, and those who were barely hanging on will continue to let those properties go into foreclosure.

Oh, and here's an easy-to-remember weather forecast for the coming three months: "Hazy, hot and humid with the chance of an afternoon thunderstorm."

Loudoun County Same-House Sales

40 ALDEN CT
STERLING, VA 20165
List Price: $259,900
Prior Sale: $346,000 09/01/2005
Listing Date: 05/25/07
-24.9%

255 JUNIPER AVE
STERLING, VA 20164
List Price: $399,900
Prior Sale: $520,000 08/11/2005
Listing Date: 05/07/07
-23.1%

839 VALEMOUNT TER NE
LEESBURG, VA 20176
List Price: $399,000
Prior Sale: $505,000 05/31/2005
Listing Date: 05/02/07
-21.0%

22932 FLEET TER
STERLING, VA 20166
List Price: $375,950
Prior Sale: $461,000 07/11/2006
Listing Date: 05/10/07
-18.4%

734 TONQUIN PL NE
LEESBURG, VA 20176
List Price: $601,900
Prior Sale: $730,000 07/12/2006
Listing Date: 05/25/07
-17.5%

21550 IREDELL TER
ASHBURN, VA 20148
List Price: $375,000
Prior Sale: $430,000 09/15/2006
Listing Date: 03/30/07
-12.8%

24989 WATERDOCK DR
ALDIE, VA 20105
List Price: $749,900
Prior Sale: $857,496 03/27/2006
Listing Date: 05/22/07
-12.5%

805 WEST CHURCH RD
STERLING, VA 20164
List Price: $460,000
Prior Sale: $520,000 08/21/2006
Listing Date: 05/13/07
-11.5%

10 SOUTHALL CT
STERLING, VA 20165
List Price: $249,900
Prior Sale: $280,000 03/25/2005
Listing Date: 03/02/07
-10.75%

285 TERRIE DR
STERLING, VA 20165
List Price: $529,900
Prior Sale: $587,700 06/30/2005
Listing Date: 05/06/07
-9.8%

314 JUNIPER AVE
STERLING, VA 20164
List Price: $369,000
Prior Sale: $395,000 8/10/2005
Listing Date: 05/19/07
-6.6%

21197 MCFADDEN SQ #404
STERLING, VA 20165
List Price: $249,900
Prior Sale: $266,570 05/04/2006
Listing Date: 05/25/07
-6.3%

Foreclosures Update

Foreclosures Update (from www.foreclosure.com).

"Active" Foreclosures 05/27/2007

Arlington: 11
Fairfax: 260
Loudoun: 171
Prince William: 418
Frederick: 38
Fauquier: 20
Culpeper: 24
Stafford: 79

"Active" Foreclosures 05/17/2007

Arlington: 16
Fairfax: 235
Loudoun: 155
Prince William: 350
Frederick: 32
Fauquier: 14
Culpeper: 26
Stafford: 77

"Active" Foreclosures 04/09/2007

Arlington: 8
Fairfax: 183
Loudoun: 116
Prince William: 255
Frederick: 24
Fauquier: 11
Culpeper: 18
Stafford: 51

Existing Home Sales

Sales of existing homes fell by a larger-than-expected amount in April while the median price of a home sold during the month fell for a ninth straight month as the troubles in the subprime mortgage market acted as a further drag on housing.
. . .
Sales were weak in all parts of the country. The Northeast experienced the biggest decline, a fall of 8.8 percent in April from the March sales pace. Sales were down 1.7 percent in the West, 1.2 percent in the Midwest and 0.7 percent in the South.

The drop in sales was accompanied by a big jump in the number of unsold homes left on the market. They climbed to a record total of 4.2 million. It would take 8.4 months to exhaust that supply of homes at the April sales pace.

Analysts are concerned that the glut of unsold homes will further depress prices in coming months.

Do we have a new David Lereah on our hands? Always blaming the weather?

But Lawrence Yun, senior economist for the Realtors, said that the small year-over-year price decline of less than 1 percent was still modest compared to the 50 percent rise in home prices that occurred during the five boom years that ended last year.

Yun said some of the weakness in April reflected a weather payback after sales had shown gains at the beginning of the year, reflecting warmer-than-normal winter weather.

My suspicion about early-season sales: buyers were anticipating higher prices in the spring (thinking "it always happens"), and rushed to get the "deals" in the winter months. Others lowballed leftovers from last year.

Digging Deeper

The new home housing headlines and stories today required a good deal of parsing.

New Home Sales Soar 16% on Price Cuts

Except:

"In a research note, Bank of America analyst Daniel Oppenheim said the data likely overstated the April sales increase. The issue boils down to the fact that the government doesn't take cancellations of sales contracts into account."

Also,

"The median price of a new home was $229,100, down 10.9% over the past year, the largest price decline since 1970"

"Sales last month were down 10.6% compared with April 2006. And sales over the first four months were 20% lower than in the comparable period last year."

The Washington Post has a "now hold on a minute" summary of the numbers today:

New-home sales nationwide increased in April by the biggest margin in 14 years, but industry experts remained skeptical about the health of the real estate market, citing a record decline in prices and nagging uncertainty among builders.

"In terms of the home builder industry, the bad times are not over," said Gregory E. Gieber, vice president of research at A.G. Edwards, a brokerage firm. "This is probably one of the worst recessions I've ever seen for housing."
. . .
"The very sharp decline in the median price suggests many sales occurring now are coming at the expense of quite a bit of discounting of homes," said Celia Chen, director of housing economics for Moody's Economy.com.

"I don't think this increase is sustainable, and I think there's a good chance the numbers will be revised in the following month."

And from Mr. Toll:

"The increase is taking place below our space, which means that we're not out of the woods yet," Toll said. "I would say we've not got the bad times behind us, yet." . . . "Given the uncertainty surrounding sales paces, and market direction and, thus, the potential for and size of future impairments, we are not comfortable giving full earnings guidance," Chief Financial Officer Joel Rassman said in a statement.

And fresh downgrades from Standard and Poor's:

Standard & Poor's on Thursday changed its rating outlook on six U.S. home builders to negative from stable, citing broad housing industry challenges and other factors.

S&P also downgraded its rating for one home builder, Comstock Homebuilding Cos. (CHCI.O: Quote, Profile , Research)

The U.S. home builders now carrying a negative rating outlook are: Centex Corp. (CTX.N: Quote, Profile , Research), D.R. Horton Inc. (DHI.N: Quote, Profile , Research), Pulte Homes Inc. (PHM.N: Quote, Profile , Research), Hovnanian Enterprises Inc. (HOV.N: Quote, Profile , Research), Kimball Hill Inc., and William Lyon Homes.

A negative outlook means S&P is likely to cut the rating in the next two years.

Fairfax County Same-House Sales

12261 TURKEY WING CT
RESTON, VA 20191
List Price: $299,999
Prior Sale: $393,000 11/09/2006
Listing Date: 12/19/06
-23.7%

5674 GENERAL JOHNSTON PL
CENTREVILLE, VA 20120
List Price: $568,900
Prior Sale: $729,990 12/13/2005
Listing Date: 04/19/07
-22.1%

13306 APGAR PL
HERNDON, VA 20170
List Price: $289,500
Prior Sale: $370,000 11/04/2005
Listing Date: 04/09/07
-21.8%

12608 LITTLE STONES LN
HERNDON, VA 20170
List Price: $399,900
Prior Sale: $508,000 07/05/2006
Listing Date: 03/27/07
-21.3%

13344 APGAR PL
HERNDON, VA 20170
List Price: $278,302
Prior Sale: $351,000 07/31/2006
Listing Date: 04/12/07
-20.7%

13939 MALCOLM JAMESON WAY
CENTREVILLE, VA 20120
List Price: $573,900
Prior Sale: $705,853 09/02/2005
Listing Date: 05/22/07
-18.7%

2216 COCQUINA DR
RESTON, VA 20191
List Price: $334,900
Prior Sale: $405,000 04/14/2006
Listing Date: 12/29/06
-17.3%

10211 FOREST LAKE DR
GREAT FALLS, VA 22066
List Price: $769,000
Prior Sale: $889,000 06/07/2006
Listing Date: 11/27/06
-13.5%

8464 SUMMER BREEZE LN
SPRINGFIELD, VA 22153
List Price: $459,000
Prior Sale: $521,000 07/06/2006
Listing Date: 05/14/07
-11.9%

5820 WESTWATER CT
CENTREVILLE, VA 20121
List Price: $339,900
Prior Sale: $385,000 05/23/2005
Listing Date: 05/16/07
-11.7%

3404 HOCKETT ST
FALLS CHURCH, VA 22042
List Price: $707,900
Prior Sale: $800,000 03/01/2006
Listing Date: 05/18/07
-11.5%

1123 CYPRESS TREE PL
HERNDON, VA 20170
List Price: $407,850
Prior Sale: $457,500 02/22/2006
Listing Date: 03/04/07
-10.9%

1116 CYPRESS TREE PL
HERNDON, VA 20170
List Price: $409,900
Prior Sale: $451,000 10/21/2005
Listing Date: 04/18/07
-9.1%

705 ALABAMA DR
HERNDON, VA 20170
List Price: $379,000
Prior Sale: $403,000 11/22/2004
Listing Date: 02/27/07
-6.0%

5912 ANNABERG PL
BURKE, VA 22015
List Price: $369,000
Prior Sale: $380,000 05/13/2005
Listing Date: 05/23/07
-2.9%

Centex in Northern Culpeper County

In spite of their recent debacle with the Town of Warrenton on a $22 million proffer that was eventually rescinded, Centex is stuck going through with Clevenger's Corner in Northern Culpeper County.

The traffic that will come from these 700 future homes to get to the jobs in Northern Virginia will come east on 211, then north on Route 29 through the Warrenton business district stop lights. It's truly going to be ugly. It's already nearly impossible to pull out of all the business parking lots on Route 29 in Warrenton at any hour of the day.

E M Risse is a writer on human settlement patterns who is concerned with traffic and poor planning. He often writes over at the Bacon's Rebellion blog. Last year, he wrote a thoughtful article about the future of our quality of life here in the exurbs if settlement patterns aren't carefully planned.

Clevenger's expects first homes built by spring
By: Jason Peck
05/16/2007

Rumors spread that a slowing housing market has stopped the mammoth Clevenger's Village project in its tracks.

The rumors apparently are wrong. Officials with developer Centex Homes say the first homes will likely appear next spring.

"We'll try to record first 70 or so lots," Centex spokesman William Neville said. "We feel that gives us a good start, the plan takes care of being able to build homes."
. . .
A slowing housing market last year forced Centex out of communities where its application was pending. But Centex already bought land in Culpeper, and signed contracts to build an expensive sewer plant for the county.

"Quite frankly, it's one of their high-profile projects," company lawyer Butch Davies said. "They are committed into the sewer plant. It's a huge project - a multi-million dollar project. They're not going to walk away from that."

Prince William County Same-House Sales

18182 CAMDENHURST DR
GAINESVILLE, VA 20155
List Price: $440,000
Prior Sale: $705,000 6/16/2006
Listing Date: 05/20/07
-37.6%

18955 ROSINGS WAY
TRIANGLE, VA 22172
List Price: $460,000
Prior Sale: $614,940 5/23/2006
Listing Date: 05/21/07
-25.2%

14008 MONTOCLAIR LN
WOODBRIDGE, VA 22193
List Price: $299,900
Prior Sale: $394,900 9/30/2005
Listing Date: 05/12/07
-24.1%

2680 CAST OFF LOOP
WOODBRIDGE, VA 22191
List Price: $544,900
Prior Sale: $713,292 1/19/2006
Listing Date: 05/21/07
-23.6%

13895 MONTOCLAIR LN
WOODBRIDGE, VA 22193
List Price: $310,000
Prior Sale: $390,000 9/6/2005
Listing Date: 05/04/07
-20.5%

15502 BANJO CT
WOODBRIDGE, VA 22193
List Price: $339,900
Prior Sale: $425,000 6/29/2005
Listing Date: 05/23/07
-20.0%

15372 GRIST MILL TER
WOODBRIDGE, VA 22191
List Price: $209,000
Prior Sale: $247,147 3/19/2007
Listing Date: 04/12/07
-15.4%

1726 ANN SCARLET CT
WOODBRIDGE, VA 22191
List Price: $459,900
Prior Sale: $535,755 4/1/2005
Listing Date: 05/21/07
-14.2%

18014 DENSWORTH MEWS
GAINESVILLE, VA 20155
List Price: $489,900
Prior Sale: $555,000 7/5/2006
Listing Date: 05/22/07
-11.7%

14587 KYLEWOOD WAY #084
GAINESVILLE, VA 20155
List Price: $305,000
Prior Sale: $330,355 7/7/2005
Listing Date: 05/21/07
-7.7%

14508 PENDERLEA CT
GAINESVILLE, VA 20155
List Price: $479,900
Prior Sale: $509,015 9/2/2004
Listing Date: 05/20/07
-5.7%

10064 ORLAND STONE DR
BRISTOW, VA 20136
List Price: $420,000
Prior Sale: $436,848 12/29/2004
Listing Date: 05/20/07
-3.9%

When Northern Virginians Retire

I'm having a hard time feeling sorry for this couple, who thought it was a good plan to have more than 90% of their retirement portfolio on one asset class. Also, they are "emotionally attached" to it.

Such perfect afternoons are exactly what Steve, 61, and Carol, 60, had in mind when they retired to Florida from Virginia two years ago. But those days are rare. Instead, the Daimlers spend most of their time consumed with selling two investment properties they bought shortly after the move - holding open houses, distributing fliers, cold-calling realtors and catering to prospective buyers.
. . .
To supplement their retirement savings of $260,000, they figured they'd buy fixer-upper homes to renovate, then sell at a profit in the state's hot housing market. "We thought we'd make $100,000 without batting an eye," says Carol.

But when the housing bubble burst, so did their dreams of a real-estate funded retirement. The properties have been on the market for nine months without a serious offer, and the carrying costs are killer: The Daimlers pay more than $65,000 a year on their mortgages (including loans for their primary residence and a vacation house in North Carolina), plus tens of thousands more for property taxes, insurance and maintenance.

The couple are pulling out $15,000 a month from savings to cover their expenses, and they've already run through more than half of their nest egg.

Money is so tight that Carol has stopped filling prescriptions for her cholesterol medicine. Steve says he has no choice but to go back to work. "The financial pressure is too great," he says.
. . .
"I know you should have a diversified portfolio," says Steve. "But I believed real estate would give us bigger returns." In 1986 the couple bought their first investment properties - two townhouses near their home in Springfield, Va. - using money Carol inherited from her mom.

In the early 1990's they sold one of the houses and used the proceeds to build a vacation home in the Outer Banks. Current estimated value: $900,000.
. . .
Carol quit her job first, in the spring of 2005. Shortly after, the couple sold their house in Virginia and paid cash for their retirement dream home: a $640,000, 3,700-square-foot house with a game room and an in-ground pool in a gated community in Port Orange, south of Daytona Beach.

The advice from the "experts" and this couple's response:

Sell the vacation home. To alleviate their cash shortage and help rebuild their savings, Michael Cirino, a financial planner with Lincoln Financial Group in Jacksonville, Fla., urges the Daimlers to sell their beach house in the Outer Banks. Probable net: $650,000. But while Steve is open to the idea, Carol is reluctant. "I have an emotional attachment to that home," she says, "and I don't want to make any more fast decisions."

Loudoun County Same-House Sales

25375 SWEETNESS TERRACE
ALDIE, VA 20105
List Price: $340,000
Prior Sale: $555,000 11/29/2006
Listing Date: 05/05/07
-38.7%

110 CONCORD CT
STERLING, VA 20164
List Price: $214,900
Prior Sale: $327,615 03/06/2007
Listing Date: 03/07/07
-34.4%

209 PERSHING AVE NW
LEESBURG, VA 20176
List Price: $649,900
Prior Sale: $870,000 09/07/2006
Listing Date: 05/18/07
-25.3%

25184 DESTINATION SQ
ALDIE, VA 20105
List Price: $378,900
Prior Sale: $510,890 07/06/2005
Listing Date: 05/19/07
-25.8%

209 PERSHING AVE NW
LEESBURG, VA 20176
List Price: $649,900
Prior Sale: $870,000 09/07/2006
Listing Date: 05/18/07
-25.3%

73 BICKEL CT
STERLING, VA 20165
List Price: $272,900
Prior Sale: $360,000 05/17/2005
Listing Date: 04/26/07
-24.2%

77 SOUTHALL CT
STERLING, VA 20165
List Price: $299,000
Prior Sale: $385,000 09/15/2005
Listing Date: 04/07/07
-22.3%

136 CONCORD CT
STERLING, VA 20164
List Price: $255,900
Prior Sale: $320,000 11/29/2005
Listing Date: 04/13/07
-20.0%

148 OAK VIEW DR SE
LEESBURG, VA 20175
List Price: $339,500
Prior Sale: $420,000 01/09/2006
Listing Date: 01/15/07
-19.2%

817 CONCORD CT
STERLING, VA 20164
List Price: $267,900
Prior Sale: $315,000 08/22/2005
Listing Date: 05/14/07
-15.0%

42710 SANDMAN TER
CHANTILLY, VA 20152
List Price: $455,000
Prior Sale: $529,900 09/28/2005
Listing Date: 05/19/07
-14.1%

46890 TRUMPET CIR
STERLING, VA 20164
List Price: $354,900
Prior Sale: $409,000 12/22/2005
Listing Date: 04/26/07
-13.2%

40867 SPECTACULAR BID PL
LEESBURG, VA 20176
List Price: $1,199,900
Prior Sale: $1,370,000 04/11/2005
Listing Date: 07/17/06
-12.4%

10 SOUTHALL CT
STERLING, VA 20165
List Price: $249,900
Prior Sale: $280,000 03/25/2005
Listing Date: 03/02/07
-10.8%

4 HANCOCK PL NE #221
LEESBURG, VA 20176
List Price: $205,900
Prior Sale: $229,900 05/11/2005
Listing Date: 04/09/07
-10.4%

208 GRASSY RIDGE TER
PURCELLVILLE, VA 20132
List Price: $389,900
Prior Sale: $422,863 01/13/2005
Listing Date: 05/19/07
-7.8%

535 LEGRACE TER
LEESBURG, VA 20176
List Price: $369,900
Prior Sale: $401,265 11/29/2005
Listing Date: 05/18/07
-7.8%

38329 MIDNIGHT SKY PL
HAMILTON, VA 20158
List Price: $795,000
Prior Sale: $831,795 07/22/2005
Listing Date: 10/16/06
-4.4%

42567 ANGEL WING WAY
ASHBURN, VA 20148
List Price: $625,000
Prior Sale: $607,500 10/19/2004
Listing Date: 05/19/07
+2.9%

Fairfax County Same-House Sales

13316 PREUIT PL
HERNDON, VA 20170
List Price: $265,000
Prior Sale: $365,000 10/28/2005
Listing Date: 04/18/07
-27.4%

13386 HUNGERFORD PL
HERNDON, VA 20170
List Price: $262,750
Prior Sale: $355,000 08/31/2005
Listing Date: 05/18/07
-26.0%

403 MAGNOLIA CT
HERNDON, VA 20170
List Price: $299,900
Prior Sale: $400,000 09/07/2005
Listing Date: 01/18/07
-25.0%

13352 PREUIT PL
HERNDON, VA 20170
List Price: $285,500
Prior Sale: $370,900 09/22/2005
Listing Date: 04/23/07
-23.0%

2665 PROSPERITY AVE #419
FAIRFAX, VA 22031
List Price: $395,000
Prior Sale: $488,850 06/23/2006
Listing Date: 05/17/07
-19.2%

1225 MAGNOLIA LN
HERNDON, VA 20170
List Price: $299,000
Prior Sale: $355,000 01/03/2006
Listing Date: 04/26/07
-15.8%

13362 PREUIT PL
HERNDON, VA 20170
List Price: $330,000
Prior Sale: $373,000 04/24/2006
Listing Date: 03/02/07
-11.5%

1043 DALEBROOK DR
ALEXANDRIA, VA 22308
List Price: $549,900
Prior Sale: $619,900 08/10/2005
Listing Date: 02/09/07
-11.3%

719 PALMER DR
HERNDON, VA 20170
List Price: $405,000
Prior Sale: $455,000 06/02/2006
Listing Date: 03/21/07
-11.0%

6409 GAYFIELDS RD
ALEXANDRIA, VA 22315
List Price: $1,174,900
Prior Sale: $1,312,370 08/01/2006
Listing Date: 02/09/07
-10.5%

1262 REDWOOD CT
HERNDON, VA 20170
List Price: $395,000
Prior Sale: $435,000 09/19/2005
Listing Date: 05/12/07
-9.2%

4608 CONWELL DR #152
ANNANDALE, VA 22003
List Price: $327,900
Prior Sale: $350,000 10/21/2005
Listing Date: 05/14/07
-6.3%

3506 ELLERY CIR
FALLS CHURCH, VA 22041
List Price: $679,900
Prior Sale: $717,815 05/02/2006
Listing Date: 02/14/07
-5.3%

11990 MARKET ST #1408
RESTON, VA 20190
List Price: $495,000
Prior Sale: $518,000 03/02/2007
Listing Date: 05/18/07
-4.4%

Clouds and Sunshine

The Washington Post today has an article about a "few rays of sunshine" in the D.C.-area real estate market:

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.

Opposing views from local economists:

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.

(Fundamentally? I don't cover Maryland; perhaps it's "different" there).

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."

Northern Virginia has a few more "clouds":

Real estate agent Kristine Price of Samson Realty in Chantilly, whose territory includes Prince William, Fairfax and Loudoun counties, said: "I'm getting more potential buyers at my open houses. Last year, at some of the open houses, I got zero. Now I'm getting 12 to 15 buyers coming through. I'm getting a lot of traffic, but not getting a lot of offers on the table.

"When I talk to some buyers, they say, 'Maybe I should wait a little and the prices will drop more.'

Prince William County Same-House Sales

15260 LORD CULPEPER CT
WOODBRIDGE, VA 22191
List Price: $484,900
Prior Sale: $608,000 11/2/2005
Listing Date: 04/25/07
-20.2%

15058 DANEHURST CIR
GAINESVILLE, VA 20155
List Price: $349,900
Prior Sale: $435,000 1/27/2006
Listing Date: 04/20/07
-19.6%

13352 POCONO CT
WOODBRIDGE, VA 22193
List Price: $340,567
Prior Sale: $423,000 7/21/2005
Listing Date: 05/17/07
-19.5%

14566 KYLEWOOD WAY #041
GAINESVILLE, VA 20155
List Price: $309,900
Prior Sale: $385,000 6/1/2005
Listing Date: 05/18/07
-19.5%

13120 KERRYDALE RD
WOODBRIDGE, VA 22193
List Price: $299,900
Prior Sale: $369,900 9/1/2005
Listing Date: 01/09/07
-18.9%

6666 RODERICK LOOP
GAINESVILLE, VA 20155
List Price: $318,900
Prior Sale: $392,000 7/18/2005
Listing Date: 10/26/06
-18.6%

13588 PRINCEDALE DR
WOODBRIDGE, VA 22193
List Price: $319,000
Prior Sale: $389,000 2/1/2006
Listing Date: 05/07/07
-18.0%

9715 DAMASCUS DR
MANASSAS, VA 20109
List Price: $331,900
Prior Sale: $403,000 6/21/2005
Listing Date: 05/15/07
-17.6%

5065 ANCHORSTONE DR #307
WOODBRIDGE, VA 22192
List Price: $329,000
Prior Sale: $397,000 9/23/2005
Listing Date: 04/12/07
-17.1%

4090 YELLOW STONE LOOP
DUMFRIES, VA 22025
List Price: $318,999
Prior Sale: $384,000 8/1/2005
Listing Date: 05/16/07
-16.9%

7534 EMERALD DR
MANASSAS, VA 20109
List Price: $261,900
Prior Sale: $313,000 10/17/2005
Listing Date: 05/02/07
-16.3%

13624 NEWTONMORE PL
BRISTOW, VA 20136
List Price: $539,900
Prior Sale: $640,665 7/21/2005
Listing Date: 05/18/07
-15.7%

3306 WYNDALE CT
WOODBRIDGE, VA 22192
List Price: $275,000
Prior Sale: $320,000 10/28/2005
Listing Date: 05/18/07
-14.1%

17088 LOFTRIDGE LN
GAINESVILLE, VA 20155
List Price: $435,000
Prior Sale: $505,065 9/20/2005
Listing Date: 05/16/07
-13.9%

15782 BARCELONA CT
WOODBRIDGE, VA 22191
List Price: $359,900
Prior Sale: $415,000 3/16/2006
Listing Date: 03/31/07
-13.3%

5607 SAINT CHARLES DR
WOODBRIDGE, VA 22193
List Price: $359,900
Prior Sale: $410,000 10/17/2005
Listing Date: 04/19/07
-12.2%

14869 LINKS POND CIR
GAINESVILLE, VA 20155
List Price: $438,900
Prior Sale: $489,900 10/24/2005
Listing Date: 05/09/07
-10.4%

15144 CLOVERDALE RD
WOODBRIDGE, VA 22193
List Price: $365,000
Prior Sale: $406,000 11/9/2005
Listing Date: 05/17/07
-10.1%

14102 CARMODY PL
WOODBRIDGE, VA 22193
List Price: $329,000
Prior Sale: $365,000 9/21/2005
Listing Date: 10/18/06
-9.9%

15828 DONALD CURTIS DR
WOODBRIDGE, VA 22191
List Price: $349,000
Prior Sale: $385,000 4/18/2006
Listing Date: 05/14/07
-9.4%

3368 CANTON CT
DUMFRIES, VA 22026
List Price: $309,900
Prior Sale: $342,000 6/30/2006
Listing Date: 05/17/07
-9.4%

12535 LINDY LN
MANASSAS, VA 20112
List Price: $459,900
Prior Sale: $500,000 10/28/2005
Listing Date: 04/19/07
-8.0%

13068 SIDLAW HILLS LN
BRISTOW, VA 20136
List Price: $369,900
Prior Sale: $382,165 9/6/2005
Listing Date: 05/13/07
-3.2%

Foreclosures Update

Foreclosures Update (from www.foreclosure.com).

"Active" Foreclosures 05/16/2007

Arlington: 16
Fairfax: 235
Loudoun: 155
Prince William: 350
Frederick: 32
Fauquier: 14
Culpeper: 26
Stafford: 77

"Active" Foreclosures 05/08/2007

Arlington: 17
Fairfax: 198
Loudoun: 135
Prince William: 312
Frederick: 28
Fauquier: 11
Culpeper: 23
Stafford: 53

"Active" Foreclosures 05/02/2007

Arlington: 16
Fairfax: 166
Loudoun: 107
Prince William: 230
Frederick: 27
Fauquier: 9
Culpeper: 26
Stafford: 37

"Active" Foreclosures 04/20/2007

Arlington: 9
Fairfax: 139
Loudoun: 97
Prince William: 184
Frederick: 22
Fauquier: 10
Culpeper: 14
Stafford: 35

Condo Conversions in Foreclosure

The Washington Post's Metro Business section writes about local failed condo conversions today.

The highlights:

300+ garden-style apartments - Ridgeleigh at Van Dorn Metro - foreclosure auction yesterday - purchased by the lender (Fremont Investment and Loan) for $60 million (minus 45 units that had been sold). The property was originally purchased in 2005 with a loan for up to $84.2 million from Fremont.

In the first quarter of the year, 3,472 condo units that were either in the planning stage or about to come on line in the Washington area were changed to apartments and another 790 were canceled, according to a report by Delta Associates.

In 2005, there were about 13,000 condos sold in the Washington area, compared with 6,600 last year, according to Delta. The market has a 3.4-year supply of condos.

Other recent foreclosures include three condominium conversions owned by Triton Real Estate Partners of Annapolis: the 434-unit Monterey Condominium in North Bethesda, the 303-unit Landing at Spa Creek in Annapolis and the 508-unit Rodgers Forge Condominiums in Baltimore County.

Yesterday Korman Communities, a real estate firm in Plymouth Meeting, Pa., announced plans to open a luxury, extended-stay hotel in Fairfax County near Dulles International Airport, a project that had originally been built as a 169-unit condo.

(Thanks to a blog reader for bringing this article to my attention).

Note of Pessimism from a "Sober Guy"

From an Editorial in the Fauquier Times-Democrat today:

Meanwhile, back at home, it's darn difficult to sell a home. Look around you at how many "For Sale" signs that you see. How long have they been there? And most are saying that the fallout from the housing bubble hasn't even begun to hit. Wait until the houses that will be foreclosed hit the over-saturated market. Didn't everybody say that you can't lose money in real estate?

Builders' Confidence Falls

CNN Money reports on the latest home builder confidence survey released today by the National Association of Home Builders:

The subindex measuring builders' view of current market conditions fell to the lowest level since February 1991.
. . .
The trade group cited tighter credit for potential buyers following the meltdown in the subprime mortgage sector, which sparked a flurry of cancellations in new home orders.

"The crisis in the subprime sector has infected other parts of the mortgage market as well as consumer psychology, and as a result the housing outlook has deteriorated," David Seiders, the builders' chief economist, said in a statement.

"We're now projecting that home sales and housing production will not begin improving until late this year, and we're expecting the early stages of the subsequent recovery to be quite sluggish," he added. "There still are tremendous uncertainties regarding our baseline forecast going forward, owing largely to the subprime crisis that is having widespread effects throughout the mortgage market."

Loudoun County Same-House Sales

104 MUFFIN CT SE
LEESBURG, VA 20175
List Price: $535,000
Prior Sale: $744,091 03/01/2006
Listing Date: 05/12/07
-28.1%

21057 VIEW GLASS TER
STERLING, VA 20164
List Price: $379,900
Prior Sale: $489,000 07/27/2006
Listing Date: 04/13/07
-22.3%

21055 VIEW GLASS TER
STERLING, VA 20164
List Price: $389,900
Prior Sale: $485,000 06/21/2006
Listing Date: 05/12/07
-19.6%

616 KINVARRA PL
PURCELLVILLE, VA 20132
List Price: $437,000
Prior Sale: $538,000 08/28/2006
Listing Date: 05/14/07
-18.8%

42644 LEGACY PARK DR
ASHBURN, VA 20148
List Price: $635,000
Prior Sale: $773,000 12/12/2005
Listing Date: 05/13/07
-17.9%

42587 GOOD HOPE LN
ASHBURN, VA 20148
List Price: $649,999
Prior Sale: $788,720 10/24/2005
Listing Date: 03/14/07
-17.6%

17 STOCKS ST
LOVETTSVILLE, VA 20180
List Price: $465,000
Prior Sale: $564,640 01/27/2006
Listing Date: 04/16/07
-17.6%

111 MISTY POND TER
PURCELLVILLE, VA 20132
List Price: $409,900
Prior Sale: $492,652 09/16/2005
Listing Date: 03/31/07
-16.8%

41749 ELOQUENCE TERRACE
ALDIE, VA 20105
List Price: $409,990
Prior Sale: $487,590 01/25/2006
Listing Date: 02/26/07
-15.9%

25316 HERRING CREEK DR
CHANTILLY, VA 20152
List Price: $618,000
Prior Sale: $730,000 05/02/2006
Listing Date: 05/09/07
-15.3%

42035 KUDU CT
ALDIE, VA 20105
List Price: $749,900
Prior Sale: $856,065 10/04/2004
Listing Date: 05/13/07
-12.4%

42639 EXPLORER DR
ASHBURN, VA 20148
List Price: $639,900
Prior Sale: $724,002 11/23/2005
Listing Date: 02/23/07
-11.6%

25286 BOLDNESS CT
ALDIE, VA 20105
List Price: $649,900
Prior Sale: $706,190 03/29/2005
Listing Date: 05/14/07
-8.0%

42411 HOLLYHOCK TER
ASHBURN, VA 20148
List Price: $325,000
Prior Sale: $351,900 08/09/2005
Listing Date: 05/14/07
-7.6%

43361 SPRING CELLAR CT
LEESBURG, VA 20176
List Price: $599,500
Prior Sale: $642,105 02/28/2005
Listing Date: 03/07/07
-6.6%

Fairfax County Same-House Sales

4687 EGGLESTON TER #222
FAIRFAX, VA 22030
List Price: $408,900
Prior Sale: $535,000 10/18/2006
Listing Date: 05/09/07
-23.6%

6213 WILLIAM MOSBY DR
CENTREVILE, VA 20121
List Price: $319,900
Prior Sale: $409,900 04/03/2006
Listing Date: 05/09/07
-22.0%

1208 AUTUMN PL
HERNDON, VA 20170
List Price: $403,900
Prior Sale: $512,900 10/11/2005
Listing Date: 04/06/07
-21.3%

768 CORDELL WAY
HERNDON, VA 20170
List Price: $291,500
Prior Sale: $370,000 07/10/2006
Listing Date: 05/07/07
-21.2%

518 DAKOTA DR
HERNDON, VA 20170
List Price: $359,000
Prior Sale: $425,000 08/12/2005
Listing Date: 03/09/07
-15.5%

13808 BEAUJOLAIS CT
CHANTILLY, VA 20151
List Price: $239,900
Prior Sale: $273,000 08/30/2005
Listing Date: 05/08/07
-12.1%

8224 GUNSTON COMMONS WAY
LORTON, VA 22079
List Price: $497,000
Prior Sale: $564,900 02/16/2006
Listing Date: 05/08/07
-12.0%

1209 AUTUMN PL
HERNDON, VA 20170
List Price: $450,000
Prior Sale: $505,000 07/06/2006
Listing Date: 05/10/07
-10.9%

3820 LIGHTFOOT ST #315
CHANTILLY, VA 20151
List Price: $267,950
Prior Sale: $295,000 12/01/2006
Listing Date: 05/08/07
-9.2%

8445 CHAUCER HOUSE CT
LORTON, VA 22079
List Price: $584,900
Prior Sale: $631,265 11/15/2005
Listing Date: 05/08/07
-7.3%

1830 FOUNTAIN DR #203
RESTON, VA 20190
List Price: $479,900
Prior Sale: $512,500 10/20/2005
Listing Date: 05/09/07
-6.4%

8515 BARROW FURNACE LN
LORTON, VA 22079
List Price: $729,990
Prior Sale: $776,920 10/13/2005
Listing Date: 05/11/07
-6.0%

3810 LIGHTFOOT ST #303
CHANTILLY, VA 20151
List Price: $274,900
Prior Sale: $286,205 09/26/2005
Listing Date: 05/11/07
-3.9%

12239 STOCKTON TEES LN
FAIRFAX, VA 22030
List Price: $538,000
Prior Sale: $557,235 04/26/2005
Listing Date: 05/09/07
-3.5%

8734 WILD PRAIRIE ROSE WAY
LORTON, VA 22079
List Price: $769,900
Prior Sale: $791,229 08/23/2005
Listing Date: 05/08/07
-2.7%

8460 KIRBY LIONSDALE DRIVE
LORTON, VA 22079
List Price: $569,900
Prior Sale: $575,000 03/21/2006
Listing Date: 05/11/07
-0.9%

A Change in Tune

The "Samson Realty" glossy newsletter shows up in my mailbox once a month. Danny Samson, President, writes a market report inside the front cover. The report I read back in November was so startling, I decided to keep following his reports to see if his advice would change. There does seem to be a bit more pessimism in the newest report. As for the advice last autumn, well, it's fine if you're the type of person who can handle the hassles of being a landlord and burning cash at 1-2 grand a month (plus repairs), while at the same time patiently holding out hope for a new housing bubble to form.

Here's a portion of the advice he gave in November, 2006:

Every case is different, but for example, if you could rent your current home at a negative cash flow of $1000 - $2000 per month (tax deductible) and wait a year or so until the market comes back, that would be very advantageous. It certainly beats having to cut your price by $100,000 or more in the current market conditions. I would pull cash from the equity on my current home to put down on the home I’m looking to buy, or do a low money down loan on the home I am buying. This way I’m buying a $1,000,000 home for $850,000. I might even pull out a little more equity to help with the negative cash flow.

May, 2007:

My top agents are telling me that the market is still good. I was hoping for a little more momentum after four good months, as we are now entering the spring market.

The weather and the calendar could have played a role; our hit counts on all web sites have dropped off dramatically. The only good weekend was Easter weekend. . . . If you try to start off in the market priced high to test the market, I think you are making a big mistake. You are going to get the most showings and your best contract early on. By taking the "We can always come down" approach, you will not receive an early contract. You will end up staying on the market longer, eventually come down in price, and end up settling for less than what you could have gotten had you priced it right in the first place. If you have had twenty or more Buyers come through your home without a good contract, THERE IS ONLY ONE PROBLEM, PRICE! I'm sorry to have to put it to you this way, but this rule holds true in any market.

Prince William County Same-House Sales

7612 MARACAIBO CT
GAINESVILLE, VA 20155
List Price: $524,900
Prior Sale: $701,180 10/3/2005
Listing Date: 04/14/07
-25.1%

14808 DYER DR
WOODBRIDGE, VA 22193
List Price: $339,900
Prior Sale: $445,000 8/22/2005
Listing Date: 04/23/07
-23.6%

4423 KENWOOD DR
WOODBRIDGE, VA 22193
List Price: $298,900
Prior Sale: $390,000 7/18/2005
Listing Date: 05/07/07
-23.4%

4605 KENWOOD DR
WOODBRIDGE, VA 22193
List Price: $319,900
Prior Sale: $415,000 8/29/2006
Listing Date: 04/04/07
-22.9%

14060 ALBERT WAY
GAINESVILLE, VA 20155
List Price: $473,900
Prior Sale: $595,000 12/1/2005
Listing Date: 04/23/07
-20.4%

15321 LORD CULPEPER CT
WOODBRIDGE, VA 22191
List Price: $469,900
Prior Sale: $586,000 12/20/2005
Listing Date: 05/06/07
-19.8%

9482 ABINGDON CT
MANASSAS, VA 20109
List Price: $250,000
Prior Sale: $310,000 12/28/2005
Listing Date: 05/11/07
-19.4%

12513 ERROLL LN
BRISTOW, VA 20136
List Price: $479,900
Prior Sale: $591,090 1/4/2006
Listing Date: 05/09/07
-18.8%

8752 DUNSTABLE LOOP
BRISTOW, VA 20136
List Price: $298,900
Prior Sale: $365,000 12/2/2005
Listing Date: 04/12/07
-18.1%

14809 DYER DR
WOODBRIDGE, VA 22193
List Price: $329,500
Prior Sale: $400,000 9/1/2005
Listing Date: 03/29/07
-17.6%

2032 MAYFLOWER DR
WOODBRIDGE, VA 22192
List Price: $269,900
Prior Sale: $325,000 7/28/2005
Listing Date: 05/08/07
-17.0%

15277 LORD CULPEPER CT
WOODBRIDGE, VA 22191
List Price: $518,900
Prior Sale: $618,000 12/30/2005
Listing Date: 05/06/07
-16.0%

1919 WILLOW LN
WOODBRIDGE, VA 22191
List Price: $306,900
Prior Sale: $363,900 5/31/2005
Listing Date: 03/13/07
-15.7%

17502 VICTORIA FALLS DR
DUMFRIES, VA 22025
List Price: $419,900
Prior Sale: $495,000 7/21/2006
Listing Date: 03/23/07
-15.2%

9438 ABINGDON CT
MANASSAS, VA 20109
List Price: $259,900
Prior Sale: $305,000 3/21/2006
Listing Date: 04/05/07
-14.8%

12904 OARLOCK CT
MANASSAS, VA 20112
List Price: $459,900
Prior Sale: $528,445 11/2/2005
Listing Date: 05/11/07
-13.0%

11302 KESSLER PL
MANASSAS, VA 20109
List Price: $305,000
Prior Sale: $350,000 6/29/2005
Listing Date: 03/12/07
-12.9%

2521 DOVERHILL CT
WOODBRIDGE, VA 22192
List Price: $309,900
Prior Sale: $355,000 7/5/2005
Listing Date: 05/08/07
-12.7%

12403 KAHNS RD
MANASSAS, VA 20112
List Price: $299,900
Prior Sale: $335,000 2/27/2006
Listing Date: 04/23/07
-10.5%

14835 WINDING LOOP
WOODBRIDGE, VA 22191
List Price: $314,900
Prior Sale: $350,000 5/22/2006
Listing Date: 04/27/07
-10.0%

8155 COBBLE POND WAY
MANASSAS, VA 20111
List Price: $379,900
Prior Sale: $421,250 12/6/2005
Listing Date: 05/09/07
-9.8%

16443 KRAMER ESTATE DR
WOODBRIDGE, VA 22191
List Price: $659,900
Prior Sale: $724,548 10/27/2005
Listing Date: 05/10/07
-8.9%

14805 DYER DR
WOODBRIDGE, VA 22193
List Price: $399,990
Prior Sale: $430,000 3/30/2006
Listing Date: 02/27/07
-7.0%

1482 ARKANSAS CT
WOODBRIDGE, VA 22191
List Price: $329,900
Prior Sale: $350,000 8/2/2005
Listing Date: 05/09/07
-5.7%

16527 RESERVOIR LOOP
DUMFRIES, VA 22026
List Price: $489,900
Prior Sale: $518,345 1/9/2006
Listing Date: 05/08/07
-5.5%

17520 VICTORIA FALLS DR
DUMFRIES, VA 22025
List Price: $389,000
Prior Sale: $405,090 10/3/2005
Listing Date: 05/03/07
-4.0%

2500 PORT POTOMAC AVE
WOODBRIDGE, VA 22191
List Price:: $670,000
Prior Sale: $690,000 12/1/2006
Listing Date: 05/10/07
-2.9%

18591 KERILL RD
TRIANGLE, VA 22172
List Price: $669,000
Prior Sale: $680,065 9/20/2005
Listing Date: 05/10/07
-1.6%

Ryan Homes Flyer

This arrived in my mailbox yesterday:

Save up to $100,000
One Day Only!*
Saturday, May 19, 2007!
Incentives & Promotions Will Be Announced at 11 A.M. on the 19th!

*All incentives/financing contributions are contingent upon the use of NVR Mortgage

This was my favorite part:

Quantities are VERY Limited and We Expect a High Volume of Purchasers for this Exciting Event. Immediate Deliveries are Available. Call Today for an Appointment to Reserve Your Time Now!

These are the communities:

Centreville Ridge-Chantilly Place-Courtland-Fairfax Crossing-Kingsridge-Kirkpatrick Farms-Little River Commons-New Town Meadows-Springdale-Sullivan Place-Windmill Crossing

A Decade of April Sales

Arlington County Year Sales Active Listings Ratio Median Sold Price 2007 252 938 3.72 $485,000 2006 216 1,122 5.19 $525,000 2005 271 353 1.30 $520,000 2004 345 286 0.83 $395,000 2003 257 352 1.37 $321,000 2002 245 296 1.21 $320,000 2001 228 335 1.47 $250,000 2000 218 375 1.72 $207,500 1999 272 687 2.53 $215,500 1998 247 N/A N/A $205,000 Alexandria City Year Sales Active Listings Ratio Median Sold Price 2007 204 935 4.58 $448,950 2006 192 1,009 5.26 $434,000 2005 266 272 1.02 $420,000 2004 274 241 0.88 $401,071 2003 254 248 0.98 $280,000 2002 215 216 1.00 $231,000 2001 256 313 1.22 $175,000 2000 214 428 2.00 $169,250 1999 221 682 3.09 $201,000 1998 178 N/A N/A $192,750 Fairfax County Year Sales Active Listings Ratio Median Sold Price 2007 1,142 7,101 6.22 $474,200 2006 1,411 7,708 5.46 $480,000 2005 1,796 2,289 1.27 $458,000 2004 1,959 2,175 1.11 $365,000 2003 1,804 2,818 1.56 $299,900 2002 1,711 2,563 1.50 $260,000 2001 1,739 2,951 1.70 $226,000 2000 1,528 3,036 1.99 $197,000 1999 1,636 5,050 3.09 $192,000 1998 1,340 N/A N/A $195,000 Loudoun County Year Sales Active Listings Ratio Median Sold Price 2007 467 3,501 7.50 $431,900 2006 467 4,314 9.24 $470,000 2005 760 1,259 1.66 $470,000 2004 685 1,120 1.64 $355,000 2003 534 1,518 2.84 $280,000 2002 513 1,409 2.75 $245,000 2001 509 1,235 2.43 $235,000 2000 369 907 2.46 $192,400 1999 316 1,341 4.24 $185,000 1998 262 1,712 6.53 $186,950 1997 185 1,681 9.09 $174,523 Prince William County & Manassas Year Sales Active Listings Ratio Median Sold Price 2007 477 5,770 12.10 $360,000 2006 705 5,189 7.36 $380,000 2005 1,093 1,328 1.22 $355,000 2004 908 997 1.10 $268,000 2003 767 1,424 1.86 $210,000 2002 799 1,179 1.48 $179,500 2001 750 1,192 1.59 $153,988 2000 595 1,427 2.40 $132,900 1999 476 2,055 4.32 $133,450 1998 345 2,821 8.18 $125,000 1997 326 2,986 9.16 $124,000

April Sales

Arlington County 2007, 2006
Total Sold Dollar Volume: $ 141,197,776; $ 121,162,523 +16.54%
Median Sold Price: $485,000; $525,000 -7.62%
Total Units Sold: 252, 216 +16.67%

Alexandria City 2007, 2006
Total Sold Dollar Volume: $101,777,360; $95,816,873 +6.22%
Median Sold Price: $448,950; $434,000 +3.44%
Total Units Sold: 204 192 +6.25%

Fairfax County 2007, 2006
Total Sold Dollar Volume: $603,372,395; $775,484,842 -22.19%
Median Sold Price: $474,200; $480,000 -1.21%
Total Units Sold: 1,142, 1,411 -19.06%

Loudoun County 2007, 2006
Total Sold Dollar Volume: $232,850,691; $248,664,757 -6.36%
Median Sold Price: $431,900; $470,000 -8.11%
Total Units Sold: 467, 467 0.00%

Prince William County 2007, 2006
Total Sold Dollar Volume: $173,203,563; $259,403,615 -33.23%
Median Sold Price: $369,000; $385,000 -4.16%
Total Units Sold: 427, 608 -29.77%


March Sales

Arlington County 2007, 2006
Total Sold Dollar Volume: $143,291,295; $139,391,599 2.80%
Median Sold Price: $469,900; $470,000 -0.02%
Total Units Sold: 263, 248 6.05%

Alexandria City 2007, 2006
Total Sold Dollar Volume: $97,715,939; $100,961,184 -3.21%
Average Sold Price: $525,355; $490,103 7.19%
Median Sold Price: $479,500; $445,000 7.75%
Total Units Sold: 186, 206 -9.71%

Fairfax County 2007, 2006
Total Sold Dollar Volume: $667,550,650; $743,198,826 -10.18%
Median Sold Price: $456,000; $477,000 -4.40%
Total Units Sold: 1,261, 1,386 -9.02%

Loudoun County 2007, 2006
Total Sold Dollar Volume: $225,748,881; $300,020,320 -24.76%
Median Sold Price: $447,450; $503,500 -11.13%
Total Units Sold: 440, 552 -20.29%

Prince William County 2007, 2006
Total Sold Dollar Volume: $170,783,920; $305,187,841 -44.04%
Median Sold Price: $389,450; $395,000 -1.41%
Total Units Sold: 418, 699 -40.20%

Source: MRIS

Loudoun County Same-House Sales

21779 LADYSLIPPER SQ
ASHBURN, VA 20147
List Price: $419,000
Prior Sale: $605,000 07/05/2006
Listing Date: 03/28/07
-30.7%

539 EDMONTON TER
LEESBURG, VA 20176
List Price: $357,000
Prior Sale: $441,000 08/25/2005
Listing Date: 05/09/07
-19.0%

852 ROCKFORD SQ
LEESBURG, VA 20176
List Price: $389,000
Prior Sale: $480,000 09/01/2005
Listing Date: 05/08/07
-19.0%

62 ESSEX SQ #62
STERLING, VA 20164
List Price: $266,000
Prior Sale: $325,000 07/15/2005
Listing Date: 04/20/07
-18.2%

21843 LADYSLIPPER SQ
ASHBURN, VA 20147
List Price: $469,900
Prior Sale: $567,548 09/01/2005
Listing Date: 04/09/07
-17.2%

1403 KENNEDY RD
STERLING, VA 20164
List Price: $412,000
Prior Sale: $475,000 01/04/2006
Listing Date: 04/26/07
-13.3%

21828 LADYSLIPPER SQ
ASHBURN, VA 20147
List Price: $480,000
Prior Sale: $553,940 09/23/2005
Listing Date: 04/11/07
-13.3%

20631 BREEDERS RUN CT
ASHBURN, VA 20147
List Price: $439,900
Prior Sale: $505,000 09/12/2005
Listing Date: 04/26/07
-12.9%

313 CORNELL DR #211
STERLING, VA 20164
List Price: $225,000
Prior Sale: $255,000 04/03/2006
Listing Date: 05/08/07
-11.8%

241 DAVIS AVE SW
LEESBURG, VA 20175
List Price: $338,000
Prior Sale: $376,000 06/06/2005
Listing Date: 04/16/07
-10.1%

22136 CHELSY PAIGE SQ
ASHBURN, VA 20148
List Price: $464,900
Prior Sale: $505,000 03/20/2007
Listing Date: 05/08/07
-7.9%

41 ESSEX SQ #41
STERLING, VA 20164
List Price: $242,900
Prior Sale: $254,500 04/05/2005
Listing Date: 05/01/07
-4.6%

303 DAVIS AVE SW
LEESBURG, VA 20175
List Price: $355,000
Prior Sale: $365,900 07/18/2006
Listing Date: 04/04/07
-3.0%

Robert Toll Grades the Markets

From Toll Brothers' F2Q07 (Qtr End 4/30/07) Earnings Call Yesterday:

Connecticut is a B-plus; New York ex the suburbs are B-plus; New York urban, which is for us Queens, Brooklyn and Manhattan, are a B-plus if not an A; New Jersey City and Hoboken are a B-plus; New Jersey suburbs, oddly enough, when you juxtapose them against the New York Dutchess County, Putnam County suburbs, you would think you would have the same result but you don’t because you’ve got in New York City -- I mean, in the New York suburbs, a B-plus and in New Jersey, same proximity to the same metropolis, you’ve got an F. It may be due to the tax situation in New Jersey.

Michigan is an F, but blessedly we sell three or four homes there a week, which is terrific. Chicago is surprisingly still an F market. Minnesota is a C-minus market, which is a whole lot better than it was. Pennsylvania is, I mean the Philadelphia suburbs, is a B market for us. The Poconos is an F market. The state of Delaware is a C-plus market. The mid-Merlin shore, as I said earlier, is an F market. Washington, D.C. is, northern Virginia is probably a D-plus market. Raleigh is a B market. Charlotte is a B market but I didn’t characterize Charlotte as being one of our better markets because we only have a couple of communities that are open there right now. We primarily have sold out a bunch of communities and we are in that stage where we are in between closings and openings.

South Carolina, which up until this year had been terrific for us, is a D market, as in dog. Florida central market, that’s Orlando, we sell a lot of homes. We get a lot of homes back. We sell the same homes. We get the same homes back. It’s a very hard market to figure. People I guess are renting them without ever moving in. That’s an F market. Florida East Coast is an F-plus market. Florida North, Jacksonville, pretty much of an F to F-plus market. Tampa is an F. Florida on the west coast is an F.

Texas is good. You’ve got a B market in Austin, a B market in Dallas, and San Antonio, we’ve got a C market because of -- go ahead and answer. You may be able to make some money but if you can, would you step out of the room, please?

Thank you. San Antonio, I said we haven’t got our product up and running as we should yet, so it’s only a C market, but suspect it is really a B. Northern California averages to be a C market for us, though there are some pockets that are Bs and some that are Ds. California southern market is a C market for us. California Palm Springs is a C market for us. Arizona, other than for the new special Wingate Ranch community, I would rate as a D-minus. Vegas is definitely an F. Reno is an F. Colorado is a C.

Home Buyers Seek a Way Out

The Wall Street Journal Online today mentions NVR Inc., which builds NV Homes and Ryan Homes:

In the latest fallout from the housing market's decline, disputes are breaking out between builders and buyers who signed contracts for new homes and condos when the market was hot -- and now want to get out of them.
. . .
In Alexandria, Va., real-estate attorney Beau Brincefield said he has settled roughly 50 contract disputes and has another "50 or more" in the pipeline. They include a case brought last year by more than a dozen buyers who had contracts to purchase homes from NVR Inc., a Reston, Va., builder that sells homes in 13 states.

Mr. Brincefield said the terms of that settlement are confidential. In general, he said, builders have agreed to lower purchase prices by as much as 35% or refund 25% to 100% of a would-be buyer's deposit. NVR declined to comment.

This builder has a good point:

Ceebraid-Signal said it is citing a "specific performance" provision in its contracts requiring buyers to hold up their end of the deal and close. . . .

"This is to frighten people and force them to close," said Mr. Moss. "It costs a lot of money in legal fees to defend these actions." A couple of buyers hit with such lawsuits have backed down and gone through with the sale.

Said Richard Schlesinger, managing director of Ceebraid-Signal: "I don't think there is anything that we are doing that is inappropriate."

"These are not situations where a woman bought a unit and she's now a widow and can't pay," he said. "These are people who don't want to close because they can't flip and make $100,000."

Northern VA Not a "Bright Spot"?

Perhaps it was an inadvertent miss . . .

From TheStreet.com this morning:

``We believe that fewer than 2% of our buyers use sub-prime loans," said CEO Robert Toll. "However, the impact of stricter lending standards arising from problems in the sub-prime market is negatively affecting affordability at lower price points. This, in turn, can impact the entire 'housing food chain,' including some of our potential customers' ability to sell their existing homes. This, coupled with a lack of buyer confidence, may have served to impede the glimmers of a rebound we had started to see in early February.

"There are some bright spots, including New York City, Hoboken and Jersey City; Dutchess County, New York and southeastern Connecticut; metro Philadelphia; Raleigh; Dallas and Austin; and portions of Northern California," he said. "We continue to feel confident about the longer-term fundamentals of our industry based on strong demographics and increased affluence. However the industry's current challenges are to reduce spec homes, restore buyer confidence and make customers feel comfortable that, with interest rates low and sellers motivated, now is an excellent time to buy a new home.''

Fairfax County Same-House Sales

700 BIRCH CT
HERNDON, VA 20170
List Price: $299,900
Prior Sale: $417,000 06/09/2006
Listing Date: 04/10/07
-28.1%

9631 WESTPORT LN
BURKE, VA 22015
List Price: $339,900
Prior Sale: $448,000 08/02/2006
Listing Date: 05/03/07
-24.1%

703 MORNINGSIDE CT
HERNDON, VA 20170
List Price: $409,900
Prior Sale: $525,000 11/22/2005
Listing Date: 05/06/07
-21.9%

5629 HARRINGTON FALLS #E
ALEXANDRIA, VA 22312
List Price: $489,990
Prior Sale: $625,950 10/10/2006
Listing Date: 04/04/07
-21.7%

6076 CLERKENWELL CT
BURKE, VA 22015
List Price: $389,900
Prior Sale: $464,000 03/23/2006
Listing Date: 03/08/07
-16.0%

1120 CYPRESS TREE PL
HERNDON, VA 20170
List Price: $370,000
Prior Sale: $435,000 02/03/2006
Listing Date: 03/13/07
-14.9%

6926 RUSKIN ST
SPRINGFIELD, VA 22150
List Price: $459,900
Prior Sale: $530,000 04/12/2006
Listing Date: 04/27/07
-13.2%

8445 CHAUCER HOUSE CT
LORTON, VA 22079
List Price: $549,900
Prior Sale: $631,265 11/15/2005
Listing Date: 05/08/07
-12.9%

8767 COLD PLAIN CT
SPRINGFIELD, VA 22153
List Price: $432,500
Prior Sale: $492,500 10/19/2005
Listing Date: 04/13/07
-12.2%

8224 GUNSTON COMMONS WAY
LORTON, VA 22079
List Price: $497,000
Prior Sale: $564,900 02/16/2006
Listing Date: 05/08/07
-12.0%

11717 KARBON HILL CT #J
RESTON, VA 20191
List Price: $304,900
Prior Sale: $345,000 06/06/2005
Listing Date: 05/01/07
-11.6%

13934 NEW BRADDOCK RD
CENTREVILLE, VA 20121
List Price: $365,000
Prior Sale: $411,000 11/1/2006
Listing Date: 04/15/07
-11.2%

8496 SUMMER BREEZE LN
SPRINGFIELD, VA 22153
List Price: $427,900
Prior Sale: $474,900 03/29/2005
Listing Date: 04/24/07
-9.9%

13956 NEW BRADDOCK RD
CENTREVILLE, VA 20121
List Price: $389,000
Prior Sale: $425,000 09/06/2005
Listing Date: 07/05/06
-8.5%

14822 LYNHODGE CT
CENTREVILLE, VA 20120
List Price: $323,000
Prior Sale: $349,000 08/29/2005
Listing Date: 03/30/07
-7.4%

9414 LAKELAND FELLS LN
LORTON, VA 22079
List Price: $619,900
Prior Sale: $657,786 11/21/2005
Listing Date: 04/06/07
-5.8%

7134 MASON GROVE CT #40
ALEXANDRIA, VA 22306
List Price: $417,000
Prior Sale: $439,222 07/03/2006
Listing Date: 05/06/07
-5.1%

9430 LAKELAND FELLS LN
LORTON, VA 22079
List Price: $599,900
Prior Sale: $628,303 12/02/2005
Listing Date: 05/03/07
-4.5%

4107 LAWRENCE ST
ALEXANDRIA, VA 22309
List Price: $428,900
Prior Sale: $443,000 07/06/2005
Listing Date: 03/26/07
-3.2%

Foreclosures Update

Foreclosures Update (from www.foreclosure.com).

"Active" Foreclosures 05/08/2007

Arlington: 17
Fairfax: 198
Loudoun: 135
Prince William: 312
Frederick: 28
Fauquier: 11
Culpeper: 23
Stafford: 53

"Active" Foreclosures 05/02/2007

Arlington: 16
Fairfax: 166
Loudoun: 107
Prince William: 230
Frederick: 27
Fauquier: 9
Culpeper: 26
Stafford: 37

"Active" Foreclosures 04/20/2007

Arlington: 9
Fairfax: 139
Loudoun: 97
Prince William: 184
Frederick: 22
Fauquier: 10
Culpeper: 14
Stafford: 35

"Active" Foreclosures 04/09/2007

Arlington: 8
Fairfax: 183
Loudoun: 116
Prince William: 255
Frederick: 24
Fauquier: 11
Culpeper: 18
Stafford: 51

Newest NAR 2007 Forecast

From Briefing.com:

10:30 am : Sellers continue to show some resolve as some discouraging news about housing provide an additional excuse to keep consolidating. At the top of the hour, the National Association of Realtors lowered their 2007 forecasts, saying existing homes sales will probably fall about 3% this year to 6.29 mln, new homes sales will likely fall about 18% to 864,000, and housing starts may plunge 19% to 1.46 mln.

Usually bad news causes the homebuilders to rally on Wall Street . . .

" It Was Like Selling Your Soul" -- New Century Employee

Only when the tide goes out do you discover who's been swimming naked. -- Warren Buffett

The Washington Post today has a fairly straightforward version of the New Century debacle today on page A01. It's a welcome relief to get this out in the open, but it's too late to warn those individuals who are going to suffer financially. Perhaps some cautionary words thrown to home buyers in 2005 would have been helpful? Instead, we got John McClain, senior fellow at the George Mason Center for Regional Analysis, predicting 15-20% gains (PDF file) in 2006 for Prince William County. (See the new Prince William County update below for how far that advice would have taken one. There's been an 11-month supply of properties for sale in PW County for several months).

From the article:

For years, the volume strategy worked.

Shares in the Irvine, Calif., company rose from $5 in early 2001 to $66 at the end of 2004, cementing its status as a Wall Street favorite. Last year it issued $51.6 billion in loans, more than any other specialized subprime mortgage lender.

When times were good, the company showered lavish gifts on its salespeople, treating them to vacations in Europe and Caribbean cruises hosted by sports celebrities. As recently as March, a few weeks before it filed for bankruptcy, the company had a trip to Ireland scheduled, employees said.

The boom continued for New Century until 2006, when mortgage payment default rates spiked. That happened because homeowners who bought houses last year generally saw their values drop. And, in a declining housing market, many homeowners, especially those who are poor, choose to let their mortgages fall into delinquency rather than try to keep up with the payments, analysts said.

At first, it appeared the cumulative effect of these defaults would have only a moderate effect on New Century's earnings. Then, in February, the company said it would need to revise its financial results for the first three quarters of 2006. A few weeks later, it acknowledged that federal investigators had launched probes into the timing of the stock sales of some of its executives. The company declined to comment on the investigations.
. . .
The appraiser in the Pearl River branch said he considered himself a loyal employee and planned to stick by the company through its struggles. But he was fired the day after the bankruptcy filing, along with 3,200 employees, or half the firm's workforce. Most of those interviewed said they were offered two weeks of pay at rates lower than their salary. A few said they did not receive any severance.

New Century announced Thursday that it is laying off 2,000 more associates. The firm is left with about 750 employees, a company spokeswoman said.