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.
Has anyone heard of this type of auction?http://washingtondc.craigslist.org/nva/rfs/663918891.htmlYes the house will be sold in a round robin bidding process. You need to come and inspect the house Saturday or Sunday or both from 12 to 5pm and leave a bid at that time. If you decide you would like to increase your bid, you need to call me before Sunday at 8pm because that is when I start the bidding process. I will call the person with the highest bid first, the second highest next and so on.The instructions will be at the house this weekend.
alexandria thinks it is worth double thatouchhttp://realestate.alexandriava.gov/detail.php?accountno=13000000
That 199K price is a true auction price. It will clearly sell at that price (I have a place and have no interest in buying but even I would buy that at 199K). If it has been properly advertised, it should go for double that.Problem is, what if it wasnt properly advertised? The guy has a listed reserve price meaning he very likely has to sell, even if it is only bottom feeders who attend. Its a risky strategy, but it definitely moves property. I wish whoever this is luck.
priced_out,I've heard of this. Casey Serin (remember him?) tried it as a last-ditch effort to unload one of his imminent foreclosures. (I think it worked in that case).I don't think I would enjoy being on the buying end of one of these sales. But it might work, and I also hope the seller does well for all his or her efforts.
Any price drops in Arlington or Alexandria this week, Harriet?
If you were in the market to buy a home, and the market is obviously in decline, how much, realistically, of a discount would you lower your offer from list price (or tax assessed value) to ensure that whatever deal you get would be enough to offset any potential market decline? Please answer in percentages.
mjc: "how much, realistically, of a discount would you lower your offer from list price (or tax assessed value) to ensure that whatever deal you get would be enough to offset any potential market decline?"This is not the way to go about it. First, list price is endogenous to the seller. Some list too high, some too low, some at market price. Second, tax assessed value relative to the going market price differs based on the zip code and the house. What if additions/modifications have been recently made and the tax assessed value is way off? What if it is a foreclosure that was brutalized by the prior occupant?If you are really in the market to buy, the best thing to do, IMO, is figure out what the going rental rate is for the type of property you want. Use any number of rent v buy websites to then try and gauge how changes in specific parameters (home appreciation rate v inflation or return on stock investment) might affect your ability to build equity with your cash in hand.
I should probably qualify my statement: the house we are looking at is an Estate sale, and the current list price is a recent appraised value so any discount would actually be based on the current FMV of the home. Does this affect your answer?
House hunt update:For anyone who is still curious about our almost endless saga:I owe all those who said to stay away from short sales a tip of my figurative hat. Our extension of our offer expired yesterday, with no word from the bank. The seller asked for another extension, and we declined. Supposedly, one of the banks has hired a professional negotiator who will start next week...hmmm...sorry...they've had our offer since February. No more.We had been negotiating with a bank on another house, a foreclosure, 5+BR/5BA, on an acre on a culdesac in Manassas. The bank had (curiously) priced the house $200,000 less than what they paid for it at its foreclosure auction on March 3, and our "best and final" offer was $24K less than asking, but they got another offer yesterday, and accepted that offer instead (smugly, I might add).How about these numbers:Purchased for $403K in 2002.Purchased for $691K March 3, 2008, at auction.I looked at the county records, and the previous owner pulled money out of the house over and over and over again between 2004 and 2007, from a variety of banks...$100K here, $208K there.Oh, well. It was not my dream house, but it was a very nice house.Now we need to decide whether to make some last-minute offers this weekend, or just give up and find a place to rent. We need to vacate our current rental in June. Time is running out.
Forgot...had to share this listing description. Too fun:10213 BENS Way MANASSAS, VA 20110 Price: $499,999 THIS LOOKS LIKE THE HOME OF A MOVIE STAR! MADONNA COULD BE HAPPY HERE! [etc.]The first house we put an offer on back in the winter was on Bens Way. It sold for $350K. The only house in the whole neighborhood that sold in 2007 went for $400K. A short sale that had been asking $570K is now asking $297K. It's a nice neighborhood, close to the VRE. Does Madonna like to ride the VRE?
please explain this hot potato transfering within relative or businesshttp://realestate.alexandriava.gov/detail.php?accountno=50704720its back to the #2 listed original buyer.current KHAN ADNAN JAWWAD01/16/2008 $0 AHMED HUMARA 11/16/2006 $0 SHAH NASEEM06/01/2006 $0 AHMAD HUMARA SHAH NASEEM05/01/2006 $0 AHMAD HUMARA AND KHAN ADNAN JAWWAD12/15/2005 $290,405 PALAZZO AT PARK CENTER LLC
Tabitha,There seems to be a lot more coming on the market every day now, especially foreclosures. You might want to give it one last try.Keep us posted.
Anyone comments from bloggers on this property?http://www.franklymls.com/FX6608073
ace,Re: Arlington/Alexandria price drops:Sure -- lots of them. I'll post them later this evening.
“…how much, realistically, of a discount would you lower your offer from list price (or tax assessed value) to ensure that whatever deal you get would be enough to offset any potential market decline?”Hi mjc,I've been asking myself the same question for the last few years. I'm no expert, so keep that in mind :) I think bubbleboy has the right idea. An appraisal can be a decent starting point, but pricing a house is not an exact science.I bought back in 1998 and will likely be looking to "move up" in the next few years (growing family). I actually started my new search back in early 2005, covering the entire area between Falls Church, Gainesville/Haymarket, and Leesburg. That's a large area and there's no way to know for sure where the bottom will ultimately be for each area.I’m not smart enough to tell you everything to consider, but here are a few things i've been thinking about during my search:1) How much has the area declined already? You never know what’s coming, but a reasonable guess on possible future declines will, in some way, depend on how much an area has already declined.2) Sales history on the house. A few sales prior to the bubble years can give you additional information. For example, if you’re looking at a place in Leesburg with a list price of $680,000 and see a sales history like this:1998 - $220,0002002 - $350,0002005 - $720,000There's a decent chance the list price is too high and it probably has a long way to go down.3) Sales history on similar homes in the area.4) How much would the house rent for? If the rent/purchase ratio is out of whack, that’s another indication that there’s more downside potential.5) Schools. Even if you don’t have children, a location with a reputation for good schools might not drop as much.Also keep in mind that you’re basically at least 6% in the hole on day 1 (future agent fees if/when you sell).Good luck. I hope everything works out for you.hog
mjc:That does change my answer a little, but it still depends on the zip. I really only follow the highest priced zips, because that is where I am looking to buy. I can say that in those zips, it appears that sales are occurring right now at around tax assessed value for homes that are reasonably assessed. I doubt this applies as well to other zips. If you want to use sales price to assessed value in your area, I would suggest getting some data on recent sales, looking up the assessed value, and seeing if you can spot a strong relationship.However, I still don't think that affects dramatically the rent v. buy calculus, which is another measure of market pricing that I truly believe in. Finally, with an estate sale, I think you can feel a bit more comfortable making a lower offer. Those sellers are likely more willing to take a lower offer to simply get the place sold than is the average seller. I say this as a cold-hearted economist who has been involved in estate sales before.
I cannot say it quickly enough.... Thank you Tabitha, and your family, for your service to our country.
mjc--Here is just one example of the estate sale dynamic: MC6689121. This place was clearly overpriced to start, but they have reduced price 14 times (sometimes only by a few dollars) over the past few months. Clearly they are itching to sell and want someone to make an offer, but are having a hard time pricing the home themselves given the amount of interior work required.
tedk, re: FX660807320 yards from Little River Turnpike and a cemetery in the back yard.Also, if i'm reading the sales history correctly, it had two separate foreclosures in 2007.Interesting place.hog
Tabitha,I noticed Miller and Smith had a quick move-ins for May at Victory Lakes. Perhaps they could work out something with you, i.e. lower the financing, pay points, pay the first 6 months of the mortgage.12404 ROCHESTER PARK CTI'm sure you've looked into this, though!
Update on our REO purchase attempt:Well, going on three weeks now trying to buy the CountryWide REO home. If they'd get their act together, we could have had this done in three days. They effectively replaced the standard contract with a 19 page addendum. After having a lawyer review this, whom laughed and told me if we didn't really like it to walk away. I've signed and initialed all these forms and contracts for the fourth time. On the previous attempts, CountryWide couldn't get their addendum correct, the required CountryWide prequal didn't match the CountryWide addendum, etc. I tried once to change the financiing, i.e. money down, so net was the same, and they rejected the whole thing. Seems CountryWide mortgage and CountryWide REO property managers don't even know what is going on as we get conflicting information from each. Funny thing is, they are in the same building/location. I have learned the steps...You apply for financing through CountryWide and get a prequal (required to make an offer), then you make an offer on the house at the prequal letter amount which must accompany offer(IMHO walking the line in regards to conflict of interest), then you submit the contract and they verbally accept it or not. If they verbally accept it, they send it all back to you, a few days later, with no signatures, along with a 19 page addedum that replaces the contract. This addendum must match, exactly, the original contract offer, if it doesn't, you have to go back to them to get it fixed, which is a few more days, you sign, then you submit everything to them again hoping for signatures. If we didn't really like the house, we wouldn't have been riding this train for so long. Thankfully we aren't in a rush.Once we get a ratified contract, I'll reveal the home/location. :)
novahog,Thanks. The last sale was in December 2005 for the crazy price of $640,000. Listed now for $400K, but an agent recently told me that inside the home, some bath rooms need substantial renovation. And the windows may need replacement.
"bas_madone52 said... please explain this hot potato transfering within relative or businesshttp://realestate.alexandriava.gov/detail.php?accountno=50704720"Looks like a bunch of business partners/flippers to me. What looks to be going on is certain people are being bought out of the venture (the consideration is not noted here) and in exchange, they are giving up or acquiring interests in the underlying asset (the real estate). The more sophisticated types purchase in the name of an LLC (for liability and transferability reasons) and then transfer interests back and forth within the LLC (similar to shares of stock) instead of the underlying property. Depending on the county you can save on transfer and recordation tax as well.
How would I go about making an economic formula to compare renting to buying? I'm not quite sure how to account for inflation, taxes, maintenance, appreciation, etc.
mjc,In case you haven't seen this already, the NYT has a good multimedia calculator where you can see how it will play out under different assumptions about the future.http://tinyurl.com/6ctnvb
tedk,Here’s the sales history since the 2005 purchase for $640K12/22/2005 – sold for $640K02/05/2007 – Suntrust Mortgage takes it back for $542,50002/22/2007 – Suntrust sells it for $480K12/14/2007 – LaSalle Bank takes it back from latest owner for $408,903It’s a convenient location. Not sure how bad the noise is from rt. 236. Looks like it has some buffer from the trees and another row of houses on 236:http://tinyurl.com/56rn3gI’m not a fan of being so close to a cemetery. It’s probably because I watched too many zombie movies when I was younger.hog
Speaking of Annandale, has anyone been on the stretch of 236 between Hummer Rd and Annandale Rd recently (east of the beltway)? About a month ago i was passing through and couldn't believe how many day laborers were standing on the service road. Probably a few hundred or so.This might be old news...haven't been in that area for a while. I wonder if Fairfax County will ever follow in PWC's footsteps?hog
mjc--it is already done for you. This is the one I have used in the past:http://www.interest.com/content/calculators/index.aspYou need to supply parameters, and get a feel for monthly maintenance and subtract that from rent.Alternatively, you can just go back to the old 16 rule (I think it was 16). This was the 15 year historic average of rent to housing prices in DC:monthly rent x 12 x 16 = housing price. The problem with this (as I understand it) is that it applies perfectly to the average house in the average zip relative to the average rental in DC metro. If your house deviates from this, that ratio could be higher or lower. Still, it is good to at least have a rough guide.
Harriet,Do you remember this house, in Braemar, in Bristow?13628 NEWTONMORE PL BRISTOW, VA 20136 On a big corner lot, over 6,000 sq ft, previous sale Oct 28, 2005 $938,176?It sold for $514,678 on Dec 28, 2007.Just so you know.
Hog,Regarding Annandale, I think that the area inside the Beltway has day laborer problems as in Herndon.But the part of Annandale that is close to the Fairfax border (west of Wakefield Forest road on 236 and close to Prosperity Avenue) is considered more desirable and feeds into excellent schools in Fairfax.
Tedk, I know that area well. I’ve spent the last 30 years in the McLean/Tysons/Falls Church area. I don’t travel through that part of Annandale very often and it really caught me off guard to see that many day laborers hanging out. In the last few months, I’ve been seeing a small group on West Broad St (rt. 7) in Falls Church City by the U-Haul store. I wonder if that group will grow over time.Tabitha, re: 13628 NEWTONMORE PL. That sale is the bank taking it back for $514K, right? I’ve seen the discussion here before…do those count as a sale in the official numbers?Side note: I’d also like to thank you and your family. I’m sure you don’t hear it enough. The sacrifice made by military families like yours can never be repaid.hog
Tabitha,Yes, I remember that very well. It was, as Novahog noticed, purchased by the bank (JP Morgan Chase) for $514,678 last December. I had it saved to one of my favorites on ZipRealty, and noticed it took some time to go under contract.I am interested in seeing what the new purchaser paid when the county updates its website. It will be interesting to see if it was bid up or not.
Harriet,I've lost my touch...pregnancy and the stress of finding us a new home has sapped my brain. Of course, that was the bank sale...and it did take a few months before it went under contract. I am very interested to see if the new buyer paid below/at/above the bank balance. Should be posting to the county pretty soon...
Post a Comment
Subscribe in a reader