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Friday, September 12, 2008
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22 comments:
FX6870108
Now that's a motivated seller:
List price: $224,500
Purchase: $210,000 Oct 2002
Yes, there are no pictures (yet). But Beverly Park is walkable to the metro, and hey, frank reccomends his buyers check out the no picture places to find good deals. This could be one. With a price like that, as long as it doesn't need major work and will pass inspection I whole-heartedly wish them a swift sale. Nice work, motivated seller, thanks for your comp.
Need your input on this house. How much do you think it is worth. It's bank-owned and has been like that for a while.
http://www.franklymls.com/LO6825187
Thanks.
Iw - probably worth 170-210k factoring in future depreciation.
lw,
checking out that same listing with redfin I get the following interesting comps:
LO6825038
current: $285,000
2001: $222,500
LO6761534
current: $269,900
These look comparable to me. So the most I would even consider offering on the one you like best would be 5% off the lowest of the three: $256,405
another good measure would be 3% appreciation from 2001: $273k
Considering market conditions then and now, I would say $256k would be a "fair" current market price.
Would I want to pay that for Sterling? No. Could it go below that in 2009, quite possibly. Am I a realtor, or have ever bought a house? No.
So I think you could make an argument with the comp short-sale list price to get the bank to accept $256k. Is that inexpensive enough for you? That's for you to answer. I don't think the bank will accept the offer I'd be comfortable giving which would be $222,500, i.e. the straight 2001 price disregarding inflation. But given that SFH in other good commuter areas near-in are listing near that, that's all I'd be willing to pay in an autumn market if I were you.
From the Washington Business Journal:
D.C. foreclosures jumped last month, foreclosures increased moderately in Maryland and they declined in Virginia.
Foreclosures in D.C. were up 16 percent in August from the month before to 649. Maryland foreclosures increased 3 percent to 3,217, and in Virginia foreclosures dropped 7 percent to 5,319. That compares to a national increase of 12 percent to a record 303,879 foreclosures, according to Irvine, Calif.-based RealtyTrac Inc.
D.C. had the highest rate of default: one out of every 436 households. Maryland's rate of default was one out of 715 households, much improved from its one out of 380 households just four months ago. In Virginia the rate was one out of every 607 households.
Nationwide, the rate of default was worse than any local jurisdiction: one out of every 416 households. The record number of foreclosures nationwide was dominated by California, which accounted for a third -- or 101,724 -- of the total.
I wouldnt read too much into the MD foreclosure increase - more than anything it is likely houses coming out of the legislature enacted 90 day foreclosure moratorium.
On the flip side, I wouldnt read too much into the VA drop either because there does seem to be some noise to the data...that said, my hunch (just a gut feeling) is we are getting close to the alltime peak in VA, so I will be interested to watch this for the next few months...
crt, thanks for the foreclosure data. I agree this looks mostly like noise.
My guess is that the seller I profiled above is an example of the start of the next wave of the 5-year ARMs, trying to get out (a)before the reset bankrupts them and (b) before everyone else's loans start resetting and we start the next wave.
Just because they "only" paid $210k, doesn't mean they can afford it. A comparable house in fly-over-land would be between 110k and 140k.
Here is the Realtytrac county by county data by rate (i.e. 1 out of every X number of houses in the county is in some stage of foreclosure):
Arl.....1/1200
Alex....1/1204
Ffx.....1/306
Lou.....1/227
PWC.....1/95
DC......1/435
Mont....1/663
PG......1/340
Howard..1/979
In VA, the huge divergence by county continues, but the rates do not seem to have gotten noticeably worse or better than 3 months ago when I first started tracking this. Maryland couties rates are getting worse each month, but again, likely due to the 90 day moratorium being lifted.
A word of warning, these guys at realtytrac notoriously overcount, probably on a magnitude of 2-3X - so the true rate in your area is probably about half what is reported here. However, they are very consistent in their overcounting so this is still a valuable piece of data to look at.
lw: that place sold for $160k back in 1999, so $300k seems awfully high after only 9 years. Still, it's better than the $400k that someone paid a few years back.
novawatcher. I agree with you that $300K is too high. I am actually thinking about 265k or something around that range. I want to come in lower (like 250k) but I am afraid that the seller won't take me seriously. At least that what my agent thinks. It's owned by GMAC.
lw,
It's 300k even, 15% off gets you to $255k. So, anything $255k or higher should be taken seriously. It's a semi-binding contract, you can submit your comparables research, including the fact of what percentage of final list things have been going for lately, (which pulls the $269k listing to under $255k) and state that the discount you've asked for is warranted by the long time on the market. If this is the place you want, and $255 to $265 seems okay to you, there's no reason they won't take you seriously. Make your agent write up the offer and write it well, and I can't imagine they won't at least counter. Make sure to make the price and purchase contingent on the inspection. A 15% off offer is low, but it's not "low-ball" not these days, and not in the fall. GMAC needs the cash, pretty desperately since they are getting spun off (or have been spun off) from GM.
You will lose money if you pay 265k for that house. I would wait a bit longer, let them drop it to 250k and then offer 210k.
lw/cara,
GMAC was a division of GM, but back in 2006 (as I recal), Cerberus bough a 51% stake in the venture. Wtih the problems GM and Cerberus are having, probably makes GMAC the worst-off auto/home financial company around, and September 3rd, they announced they would lay off 5,000 people, so yes, they need cash.
The only minor problem I see with a low offer is that with the dip in morgage rates, you might have a few fence-sitters coming into the market next few weeks, so if you really want the house, advice given by cara is good, if you can let it go, Doug's price of $210 might be doable, but don't count on it.
cara,
Thank you for the advice. It's a really good idea. Do you know how I can get the listing price and final sale price of closed sales? Or should I just ask my agent to provide me the information? Agent should have it, right?
Doug,
My experience is that $210K is really low in that area, at least right now. I thought about waiting for several months but this housing searching process is really getting on my nerve now. I feel like everything in my life is contingent on me finding a place to own and live.
I really like that place and it has everything I am asking for. If I need to pay up a little bit to make myself more "emotionally stable", so be it.
Having said that, your advice is still very valuable. At least I know asking 250k is not too ridiculus.
lw,
Don't worry about the other fence-sitters, if no one's moved on this property in over 100 days, no one else will now either.
I think the sale/list price can be gotten from the MRIS, but I don't know precisely how. Your agent, most definitely should have access to such numbers, and if you tell them that you want to include that in your justification of the offer price, they certainly should be able to get it for you.
I understand your pain of waiting. But I do like the condo you picked out, and honestly, if I could get one exactly like it in Franconia Springfield, walking distance to the metro, I'd take it in a heart beat at $255k. So, sure, it might come down, but I have a hard time picturing it going below $220k for more than a year or two, so if you want it now, go for it.
LW,
The last sale, December 1, 2006, was for $400,000. Is that what you wanted to know, or are you looking to find out how much money the bank has into the property?
More info here: http://tinyurl.com/5x67zt
(link to property on Redfin)
lw: go here:
http://www.mris.com/reports/stats/zip_stats.cfm
...and type in the zip. Of course, this doesn't
(1) break things down by type (SFH, TH, etc.)
(2) tell you the original list price. I'm pretty sure that the percentage of list that they quote is the last list price on the MLS.
LW - One more thing to take into account is selection. With inventory declining as it is, my general preference would be to be a bit early than a bit late when there is less decent stuff available. That said, if this is but one of many you would be perfectly happy with dont worry about that yet.
Also, I agree with Caras last statement 100%. My philosophy can be summed up very simply:
1. If you can afford it, go to step 2, if not, wait or look elsewhere.
2. If you can stomach the possibility of the drop she described, go to step 3, if not, wait or look elsewhere.
3. If you plan to live there at least 5 years or more, go for it, if not, wait or look elsewhere.
4. If 1-3 arent in the cards for whatever reason, be content with renting, like so many of our european counterparts who are perfectly happy!
Why not just offer $150,000?
Or look up the listing agent's track record and see what other drops the bank has accepted... data= Priceless
novawatcher,
thanks for reposting that link
for ZIP Code: 20166 Sterling, VA
From: 08/01/2008 to 08/31/2008 Avg Sale Price as a
percentage of Avg List Price: 93.54 %
(for July 94.2%)
Printing out that page and including it in the justification is not a bad idea.
Those averages are even more of a discount than the 5% off the list of the "comp" you'd be presenting.
As far as available stock goes, judging purely from what's posted now on Redfin, I think this is actually the best condo of it's type currently on the market in the immediate neighborhood, so definitely a go ahead and act on it moment, (assuming CRT's steps 1-5)
cara, NoVAwatcher, 0.0, tom, et al,
remember this 2/2/0, 3-level, $500K Ballston TH i posted few days ago? yup, under contract in six days.
i only loosely track ballston area but i think this sets a new low sales price record for ballston THs post-bubble.
Finally - some 'realistic prices' in alexandria behind skyline!
2008 assement 618k
priced at 409k.
http://www.redfin.com/VA/ALEXANDRIA/5438-COLFAX-Ave-22311/home/11857224
foreclosed 2x it looks like ;)
http://realestate.alexandriava.gov/detail.php?accountno=41104000
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