Continuing to examine and hold a lively discussion of the Northern Virginia Real Estate market.
Please post your local house search updates, MLS finds, off-topic ideas, and links here.And be sure to check back tomorrow for March sales data.
Has anyone been paying attention to the reports of MS-13 gang activity going on in formally nice neighborhoods such as Braeymar and Victory Lakes in PWC?Apparently there has been gang symbols painted on some homes, and some foreclosures being stripped bare in the middle of the night. Robberies and assaults are probably coming soon...If that wont kill property values in short order I dont know what will.
I haven't heard about these happenings, but it won't help the property values in those 'hoods, that's for sure.Aren't those semi-spanky 'hoods in Bristol/Gainsville?Are they in Manassas' back yard?Scary!p.s. I think there's a lot of gang activity in Centreville too- some of those townhouse communites are getting rougher by the Month
I reported about 2 weeks ago my sense that the housing market in and around Fairfax, Chantilly, Herndon (along the FFX Co Pkwy corridor) has not been tanking for “good” properties. By that I mean that rather than seeing prices dropping 20-30% from the ’06 peak, that they are only off by 10-15% for these places. This is based on my house hunting of the past 4 months which looks like it’s coming to a successful close. (More on that in a later post . . . )My wife and I toured about 60-70 properties from December through April, and I’d say that only 8-10 of those places were “good” in the sense of having the features we needed (# of bedrooms and bathrooms) and wanted (deck, updated kitchen, 2-car garage, good overall quality), having enough useful space (closets, size of kitchen, family-living room space, storage), and being in the right location (commute not too long, decent neighborhood). Most of the places we considered “good” were THs in the McNair Farms area (since the commute works well for us), although we probably looked at 20 SFHs up in Herndon, especially north of Herndon Pkwy, around Hiddenbrook, Ryan Road, and over towards Dranesville Rd. We saw about 10 SFHs around Herndon that were in absolutely awful shape which we either drove right past or only stepped one foot in and quickly backed away. As a result, we grew concerned that the those SFHs could fall in value for much longer than the THs in the McNair Farms area.With regard to these THs, we discovered that those that had popular features (especially 2-car garages) in the McNair Farms area were being snatched up within 2 weeks of hitting the market, and other decent places were going within about a month. On the other hand, those that hadn’t been updated, needed substantial repairs, lacked adequate storage and closets, or only had a 1-car garage, were sitting on the market the whole time we were looking. We did see about, oh, 10-15 places in this category which lowered their price by 5-10% during the time we were hunting, and even still they were sitting on the market. For these places (which I would call “average”), they’re likely to slip into the 25-30% discount range (from the 2006 high mark).But overall I’d say there’s a substantial divergence between the good places, which have only slipped 10% and might not fall much more than 15% overall, and the average places which are getting down into the 20% discount range, and are likely to slip further. But these aren’t going to “wow” their owners. Rather, these are places that owners will need to update with at least $20K worth of work – and more like $30-40K if the kitchen needs to be updated.And then, of course, there are those terrible foreclosures which look like they’re going to lose 50% of their value.
down 20+% from 2006.This is interesting one. This is representative of older THs in Alexandria. Kinda like watching Fairlington, Parkington, and Shirlington except these places are identical. 3 levels, no garage, a dungeon of a basement. The main level is a kitchen and living room. The upper level is 3 tiny bedrooms and an OK size bathroom. At the peak, these were selling at about $450K, give or take a little. Most listings are still just over $400K but this one is different. It went up on 3/10/2008, asking $349,990.FLORES JAIME ESQUIVEL GALICIA EDGAR SAUL paid $436,152 on 10/30/2006.
kh,And it's already been on the market for one month. Makes one wonder.ZipRealty has this:Price Reduced: 04/04/08 -- $450,000 to $349,990also,231 TENNESSEE AVE, Alexandria, VA 22305On Market: 242 days Price reductions & one increase:09/06/07 -- $449,900 to $439,90011/27/07 -- $439,900 to $429,90002/07/08 -- $429,900 to $419,90003/26/08 -- $419,900 to $429,90004/07/08 -- $429,900 to $409,900Keeping a property on the market 242 days is an interesting way to sell real estate.
nuf-said I agree with your analysis, I would avoid Hiddenbrook as the homes are aged and lots of 80 foot tall dead trees. Plus its a pain to get out of, either go to 7 or thru Herndon. McNair is nice and a good school. Try the corner of Sunrise valley and Monroe for nice TH's. I usually look at zip code 20171 and then weed out anything that has "copper" in the name, lol. Stear away from anything directly south of Reston, but it does clean up after a few blocks south.
Krugman (Princeton, NY Times) and Brad DeLong (U Cal-Berkeley) have an interesting back and forth regarding the housing market. It is similar to the discussion that we've had here with Lance and KH on one side and everyone else on the other.DeLong predicts that the RE market in prime areas will give up no more than 1/2 of inflation adjusted bubble price gains, given the stimulus of foreign capital, scarcity of well-located real estate, and continued shifting of income distribution towards the wealthy. See: http://tinyurl.com/5l7vfhKrugman disagrees, explaining that rents have hardly risen in real terms, i.e., at 1987 inflation adjusted levels. Krugman explains that if DeLong's arguments that housing scarcity and income distribution were sufficient to elevate house prices above historical inflation adjusted levels, rents should have followed suit. But rents didn't. See: http://tinyurl.com/5far7xKrugman's point is relevant to our discussions here in one respect: if DC were indeed to become an international city on a par with NYC or London, then we would first have to see NYC-level rents. I have my doubts.
wey1nuf-said,Been on the hunt here for a condo at the Foxcroft in Fairfax City and in the South Reston area for the last two months. Good can mean many things. As with you location was key, as well as beds and baths. The wants can make the process even harder. For me it was about the quality of the space. I wanted to find a place that I would have to put minimal money in to make me feel comfortable. Like you I visited like 14 properties over the past 2 months. Tried to avoid short sales. What I saw was depressing (and at times down right disgusting - two of the worst was a doggy poo-poo place and one place that the cockroaches seemed to be pets for the tenants). In the end I found three place in Reston that were worth looking at. After two weeks since submitting a contract on a bank owned property I finally have a ratified contract today! :)Sent them a contract on 3/26 for $155K as a counter to their offer of $165K with a request for $4500 in closing costs. It took till 4/1 to counter at $157K and $4300 in closing costs. It took till 4/5 to get the addendum they needed signing. Signed the addendum on 4/6. In that addendum they would not guarantee that the appliances would convey. So we amended the contract they sent over to include these that day. It took till the morning of the 4/8 to hear that they rejected the amended contract on the basis they would not guarantee the appliances that are there are there (scratching head on this one). It took most of the day on 4/8 for my agent and the banks agent to come up with an addendum that they thought the asset manager would accept about the appliances and meet my concerns. Finally late today (4/9) the asset manager accepted it, and all parties are happy. Set to close on 4/28 now. Some may wonder why I put up with it, and fought for my terms in the end. Simply this place is "Best of Show"! Fresh paint, a totally renovated kitchen (the way I only dreamed of for my old TH in Herndon that I sold 3 years ago), bathrooms updated in a simple way which fits me, ceramic tile in the hallway/kitchen/dining room/and baths, and small details like new HVAC vents, replaced the slab doors of the 70's with 6-panel doors, and wood blinds! Since I am looking to be there very long term, I have no issues with the $157K that we agreed upon. I feel as if I have gotten a good deal here for what were things that I have always wanted in a home. Bargain basement? Perhaps not as some bubble heads think. Only time will tell. But the sales/listing prices are as follows:- last sale in in 12/06 of $242K- what seems to be a short sale of about $200K in 9/07- Bank owned at sometime early this year at $170K - In the last 30 days reduced to $165K - final ratified price of $157KFrom the high, that is a 35% price reduction from 2006. Since 9/07 a 21% drop to my accepted price; and a 8% drop since the bank took over the property. Do have to admit that I also looked at just how low i was willing to go in order to maintain the property values in view of the upgrades. I will cross my fingers that the values will hold in the near term of 3 to 5 years. In the long term of 10+ years I think I have done well here. I want to thank all that have answered my questions here during my search. Still welcome comments though as I wait for the condo docs and my approval of them. Warm thanks,Chip
harriet, I agree about 200+ DOM. I have looked at some of those in my search with no price reductions in that time in the communities I looked at. terminator-x, thanks for the links. It does seem that those numbers are making my choice seem to be right for me in the short term. Though my rent has gone up a bit more - but not by much more. In the end the tax savings will give me a bit more take home pay - even after some of the utilities I pay now. And I have added extra space to boot! Add to that from what I have been able to read so far - the management has been pretty strong overall of the condos I am looking at.
Doug,I live in Victory Lakes, and there hasn't been any gang activity at all. A couple of car break in's, dog attacks, in the year I've been here. We have a neighborhood watch, and get police reports for the neighborhood every month. I'd love to know where you heard that too. Can't speak for Braeymar though.
Chip,Sounds fine!It took only two weeks. Not bad at all.We used to live in Reston and found it very convenient to everything.
With respect to rents approaching New York levels, obviously that is not happening any time soon. But rents in truly prime areas (i.e. good buildings in Clarendon, Dupont, Kalorama) have climbed steadily higher, especially once you get past 1BRs, and on a square footage/amenity level are probably within shouting distance from New York apartments, certainly equal if you take into account the cost of parking in NYC. And of course a neighborhood like Clarendon, or even Ballston, simply does not exist in New York.
Chip - sounds like an awesome place for a great price, congrats! A guy at work I know payed 340k for a 1 bed condo in Faircrest ( Centreville ) a couple years back - your place sounds 10x nicer and in a much better location. First rule of investing - dont buy during a buying frenzy and dont sell during a selling frenzy. Steve, I heard this from a good friend of mine who is a US Marshall and is working closely with PWC police on illegals/gang activity.
"Price Reduced:04/04/08 -- $450,000 to $349,990"That makes sense and it doesn't.Those places have been selling for over $400K, $420K, $430K. $450K was too high. $395K plus $3,500 toward closing would be an aggressive discount from recent sales, of which there are several.I wonder if there is a story behind this one. Water damage, termites, or what?Congratulations to Chip on pulling the trigger!!
Thanks all for the warm wishes! After the 28th, no looking back. :) LOLharriet, Those two weeks were from submitting a contract till it was ratified. Keep in mind the property was still in play all that time. Pretty nerve wracking for a buyer in knowing that another buyer could submit another contract for more than I did and I could loose it. Maybe that it was a Countrywide property scared some away. I know my agent is now more savvy in how to write a contract for one of their properties now. But I was not going to get in to the mentality of home lust that drove the market in the past. Just made me happy that I didn't try for a short sale. :)doug, Many thanks for the kind words. :) Here is a link to the MLS listing (seems to still be active on FranklyMLS) :http://franklymls.com/FX6675811.htmlDid do a lookup for Faircrest for 1BR units. While I like the "open" look of these units, I prefer the option of two baths and a possible roomie if I need one. One of the sweet things about Shadowood is that each building only has 6 to 8 units each. So these have windows in the front and back. Something you don't see in many newer construction. You are right about the living in Reston! Sure the community is older, and looks it at times. But living in Reston has it perks. I am 3/4 mile from a Safeway and CVS by walking the paved trails.
Hey Chip, yep still active.Hey Nuf-said. 60 homes!! Wow. Are you by chance taking photos of all of these homes?Any interest in sharing them on my new WIKI MLS? Of course, only for the Vacant homes?Can you email me directly?Thanks!Frank
Thanks Frank.....Puzzled a bit since my agent is saying that this property is showing up on the MLS as under contract.BTW keep up the great work you have done so far!
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