From the Chicago Tribune:
"About 604,000 new houses sold in December, a 4.7 percent drop from November and a 40.7 percent decline from the end of 2006, according to a report Monday from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.
December sale prices, meanwhile, fell about 10 percent from a year earlier.
'This is worse than expected and highlights the dire straits of the housing market,' said Mark Zandi, chief economist for Moody's Economy.com in West Chester, Pa. 'The floor has fallen out of the housing market.'
Adding to the industry's woes, he said, were 'weak job growth and rising unemployment.'
New-home sales are down 57 percent from the peak in mid-2005, and prices are off 17 percent since spring 2007, Zandi noted, adding, 'This is the worst housing decline since the Great Depression.'
20 comments:
It's not all doom and gloom. Real estate is very "locational," and as I've been noting for some time, in this area you can find neighborhoods where houses are priced -- and selling -- at levels pretty much unchanged from where they were two years ago. In my neck of the woods (North Arlington), neighborhoods located a walking distance from Metrorail are doing just fine.
Check out this recent sale (below). The house is absolutely nothing special; it needs some renovation. But it's located within walking distance of the Ballston Metro station. The purchase price was MORE than the selling price:
http://www.arlingtonva.us/Departments/RealEstate/reassessments/scripts/Inquiry.asp?action=view&lrsn=12111
Looking into it, that was an estate sale. Could that have anything to do with the price it closed at?
Tell me where I can get a pair of those blinders you got on there tom?
Sorry you quit your...engineering job (?)... to become a realtor.
Come on fish, you really think there have been declines in North Arlington Orange Line SFH houses? I can point you to a number of sales increases in the last two years, including some in the past month or so.
No doubt parts of Arlington, particularly 22204, are being impacted, but there is simply no evidence that the Orange Line is being really affected. In fact, I can think off the top of my head of 7 or 8 major developments being built or in late planning stages as we speak.
I think all this focus on the Orange Line SFH neighborhoods is misplaced.
Have they retained their value? Sure. But they would be the absolute last homes in the area to be hit. The typical residents of those areas--well educated professional couples with no kids or very young kids, who work downtown or on the Hill--are the most economic resistent of all, and those houses are essentially starter houses for most people.
I think it is by no means mutually inconsistent to say that there is a major market dislocation in most areas in NoVa, and yet the grand total of 1500 homes within walking distance of the Metro in Lyon Village, Lyon Park and Ashton Heights are still doing well. To compare them to someplace like Chantilly is missing the point entirely. Many folks in the outer suburbs would not want a 2100 sq. foot bungalow in Lyon Park, and most people in Lyon Park would not want a 5000 sq. foot mansion in Ashburn.
The real story as I see it is that things have played out very nearly exactly as predicted.
Yes, certain areas have held up better than others so far. Why is that surprising in the slightest? What is the point of repeating this over and over again?
Just because there is some tiny portion of the region that has not yet been hit does not mean that it is somehow immune. Just a few months ago we had people telling us that "inside the beltway" was safe... now the story has changed to "the northern tip of Arlington is safe."
If those houses shot up during the boom they will ultimately feel the effects of the bust. That is all there is to it.
Anyone who honestly believes that the entire region is going to fall but that tiny pockets of houses will somehow be unaffected needs to take a class on economics.
The declines are moving into Arlington. Soon it will be the houses just outside of walking distance that feel the effects of the bust... then it will be houses at the fringes of walking distance... then it will be the houses with a relatively long walk to the metro... then... etc etc
It takes a long time for the bust to propagate all the way through the region. Few people are directly comparing Manassas to North Arlington, but there are quite a few people that are comparing Manassas to its neighbors.
If prices drop by a large percentage in Manassas that affects the market in Centerville. As prices fall in Centervile it affects Fairfax. Fairfax affects Vienna and Falls Church... etc etc.
The bust is like a slow motion wave moving through the area. It will be YEARS before it is completely done.
Narl,
Have you seen any same house sales from 2005-2006 being sold today for an increase in North Arlington? Without any significant upgrades/renovations?
My own observation is that homes sales prices have dropped from the 675-750 range to the 600-675 range for the small, unimproved homes in North Arlington.
McMansions and Condos in this area skew things but there's some good information to be pulled out here: http://www.mris.com/reports/stats/zip_stats.cfm
My $0.02
I'm not talking about 22207, but rather houses on the Orange Line
I havent seen anything top 06 prices but Ive seen stuff sell at 05 prices, and a decent amount above 04 prices.
Im in 22205, about 1/2 mi to Ballston.
There has definitely been a slight ( like you said 50k or so ) price decline since 06 which makes me mad since my tax value keeps increasing.
Glad we're almost all basically agreed: houses within walking distance of Metrorail in Arlington are generally unaffected by the slump. And nobody knows what will happen in the future.
Suits me!
"And nobody knows what will happen in the future."
Actually, it appears that Leroy is predicting a decline, or at least a multi-year long flat period, for the SFH in North Arlington near the Orange Line.
So, he's doing what any honest person should try to do, predict the future based on an underlying model of housing markets.
So, Tom, what's your prediction, or do you just say that you have no underlying understanding, so you don't offer a prediction?
Remember, if you never make a prediction, right or wrong, then you can never develop or improve on your understanding.
The fact is, the "bubbleheads" correctly predicted the future, so their opinions are receiving more well-deserved weight, at least from the non-crazy segment of the population.
I havent seen bubbleheads predict anything that an imbecel couldent predict.
All people here said is there was a real estate bubble that was going to pop. Everyone knew that.
As the fallout occurred, bubbleheads changed their opinions "Well the close in areas will be hit later" and so on. Thats not a prediction, thats an analysis of current events.
"I havent seen bubbleheads predict anything that an imbecel couldent predict.
All people here said is there was a real estate bubble that was going to pop. Everyone knew that."
That reminds me of the following:
"All truth passes through three stages: First, it is ridiculed; Second, it is violently opposed; and Third, it is accepted as self-evident."
- Arthur Schopenhauer
"I havent seen bubbleheads predict anything that an imbecel couldent predict."
Where were you a year and a half ago?
There was a lot of debate about whether or not there was even a bubble. Heck, there are STILL a couple people on this blog that insist that prices are not out of whack...
I've watched the progression from afar and it's all pretty much "going to plan". Leroy explains the "bubble denier thought process" pretty well:
1. It's only FL not DC/NoVa
2. It's only FL and CA not DC/NoVa
3. It's not inside the beltway
4. It's not Arlington
5. It's not Arlington near to the Orange Line
6. It's not Arlington within walking distance to the Orange Line
7. It's not next to the OL.
8. It's not my house.
9. Oh, $hit, it is my house too.
We are on Step 5. The previous steps were predicted by "bubbleheads" starting in 2005. [FWIW, I saw the shadow of Step 1, realized what was happening and sold 6/2005 in 22044 and rented in Mt. Pleasant for a year.]
Sorry, Tom. It is all gloom and doom.
But Lawdy, do I miss playing bluegrass at Lyon Park and Ray's the Steaks!
MrBubble
Given that there are numerous examples of price increases in Arlington on same-house sales since 2005, not sure where your argument is coming from nor where it is going, but it is entertaining to watch.
I've been looking for a rerun of the early 1990's when close-in alexandria fell about 10% and went essentially flat for 10 years, 1990-1999.
Then I get this from the city.
How can I get my well deserved tax break if places keep selling for more than the previous year's assessment?
How can I grab a rental at a bargain price if places are selling for higher and higher prices?
I read here that any day now, I'll get a roll back on my property tax and the opportunity of a lifetime to buy rental property.
There was supposed to be a bubble popping in 2004 or 2005. Where is it? I know, I know, just be patient, if not this year, then next.
Next? 2009? Five years after 2004?
"I've been looking for a rerun of the early 1990's when close-in alexandria fell about 10% and went essentially flat for 10 years, 1990-1999."
Which makes perfect sense because this is after all a "normal cycle" isn't it? You might want to read some of the news articles that are out there...
"New-home sales are down 57 percent from the peak in mid-2005, and prices are off 17 percent since spring 2007, Zandi noted, adding, 'This is the worst housing decline since the Great Depression.'"
"Home prices were down 8.4 percent in November compared with last year in its 10-city index, a record low. The 20-city index also fell 7.7 percent."
"Sales of new homes plunged by a record amount in 2007 while prices posted the weakest showing in 16 years, demonstrating the troubles builders are facing with a huge backlog of unsold homes."
All of those are from the current front page of this blog...
Shoot... even doug has this to say:
"All people here said is there was a real estate bubble that was going to pop. Everyone knew that."
Check out 2819 RUSSELL RD, 22305
My comments refer to data at the above link.
Just noticed that the city changed the Sale Code to, "VERIFIED - valid sales - A no disqualifying circumstances"
The Assessment progression goes from about a half mil in 2000 to a mill in 2004. Some call that the bubble. Fair enough.
Following 2004, 2005, 2006, and 2007 are flat. If you look real hard, you can maybe see a 5% dip 2006 to 2007. If that's a bubble busting, that's pretty pathetic.
Yes, the fall was greater in PWC but PWC is so far out that you might as well be talking about Iowa or Nebraska.
That's when BH were pushing hard on the rope.
10/02/2007 - HUGHES, ROBERT J drops
$1,393,000, seals the deal.
While the previous HH was asking 1.6 Mill (as I recall), they didn't get it. They only got almost 40% over the Jan 2007 assessment.
2819 RUSSELL RD, 22305 is not walking distance to the metro. It is on a bus line. It is also on the "wrong side" of Russell Rd.
In that area, Russell Rd separates Beverly Hills from Mt. Ida and Del Ray, which are not considered as prestigious.
The lot is undersized for that large a house. It's also poorly sited. The front steps are a few feet from Russell Road.
I have no say in whether HUGHES, ROBERT J paid too much, the right amount, or too little. He offered and his offer was accepted.
The city booked the sale.
What does concern me is that 2819 RUSSELL RD, 22305 is a few blocks away.
According to the city's records, most other places in my area sold for above assessment in 2007.
That suggests that in 2 weeks, my taxes will increase.
@FD;
Is that for f*****-debtor?
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