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September sales will be out tomorrow from the Metropolitan Regional Information Service.
Thursday, October 9, 2008
Northern Virginia Bits Bucket 10/9/2008
Posted by Harriet at 9:18 AM
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16 comments:
Lots of stuff selling near me in 22205 ( N. Arlington ). I looked it up and the prices are generally 5% under list, although a few are at or slightly higher than list price.
Seems like the strongest area is the 650-850k range. Those often sell for list or very near list.
The higher you go, the greater the discount. But some people are still paying 1.3M - 1.4M for 4500 sq foot tear downs depending on the location despite others selling for 1.1M for virtually the same size house.
I dont know how the appraisers reconcile that since they are the same zip code.
Looks like the contract fell through for this $430K Springfield Rambler. Someone else was tracking this home and noted the great remodeling effort. And I remember looking at its pictures and thinking wow it's a nice house - too bad it's not in No Arl...
That is a nice house - those quality finishes are usually not seen in homes in that price range.
The only big beef I have is that the master bath only has one vanity.
I would personally paint the siding and the trim a different color.
Ive been in that neighborhood when Ive visited Accotink Park for a work function. Its a really nice area.
Somebody should go lowball them at 350k, maybe get it for 375k.
Hi everyone. First post here after months of lurking. What do I make of this?
http://franklymls.com/FX6888441
900K for a $1.4M assessed house in a prestigious neighborhood. I guess nobody wants a 10,000sqft home anymore...
Virginia orders 570 state layoffs amid budget woes
Link to story
Earlier this week, Kaine said budget woes are prompting cuts at the governor's mansion, too. He's said he will reduce the mansion's grocery bill by one fourth, take fewer trips and dry clean his drapes less often.
ng,
that means the assessor was on drug.
NG-
Balmoral is/was a spanky Clifton hood with McMansions on large lots.
WOW - 2 main level master suites -
I'd lowball this bad boy at 700K and see how "bad" they want to move!!
Probably a Day trader that's going down today big time!
Some random thoughts:
With the stock market's fall today, we are back to 2003 levels. This only reinforces the view that markets must revert to their long-term trend line, often overshooting it.
I think the same must hold for real estate. So inside the beltway folks need to be wary of thinking their homes will be OK.
Another thing--has anyone here noticed that the World Economic Forum has just rated Canadian banks as the soundest in the world ? US banks are ranked 40th.
The reason?
At least in part more regulation in Canada.
When the banks there wanted to bulk up through mergers in the late 1990's, the Govt. firmly said no because it would mean fewer choices and higher banking fees for the public. The resulting lack of size, they say, prevented them from becoming more global and unwittingly prevented their banks from making aggressive subprime bets.
NG - if that place is where I think it is...well, I took a wrong turn a year or so ago in the Clifton area, got lost, and ended up in an area of damned nice homes on large lots.
Based on the map, that looks like the area I got lost in. I'd say that as long as work isn't too far away (Fair Oaks would be reasonably close), that would be a great place to live. Having said that, I'm the type of person that prefers 2-acre lots to North Arlington.
Ted K - 2 responses
"I think the same must hold for real estate. So inside the beltway folks need to be wary of thinking their homes will be OK."
I think its gone way beyond inside the beltway vs outside. For the last 3 years, most of the local indicators suggest inside and outside the beltway real estate has been moving in lockstep - the only difference has been the severity of the drops. All areas had rising inventory, falling sales, falling prices, falling inventory and (in the last month) rising sales.
As such, I dont expect anything happening on the macro economic level to disproportionately affect inside the beltway anymore. Either they are both affected, or neither are affected. Either all are safe, or none are safe - this has yet to be determined (see below).
"With the stock market's fall today, we are back to 2003 levels. This only reinforces the view that markets must revert to their long-term trend line, often overshooting it."
This is a great question, but I think the answer is maybe, maybe not. Looking at p/e ratios, this looks like pure panic selling - completely overshooting where stock prices "should" be - even when you price in a near certain recession. However there is another possibility rarely discussed - deflation.
If we truly are experiencing deflation, the markets are behaving rationally. If this is deflation, the "e" part of p/e ratios are about to get destroyed, and the market is pricing that in. If so, the stock markets are pricing that loss of "e" in giving the appearance of panic type overshooting, yet they are truly rational and are able to see the future.
If this is correct, housing prices everywhere are in real trouble. Homeowners, who have locked in their debt and debt payments could be in real trouble. If correct, paradoxically, having the "safety" of a fixed rate mortgage is a serious mistake. If so, interest rates will fall to near nothing, and cash will be king.
That said, I dont yet believe it is deflation. Further, even if it is, once the govt realizes this, the printing presses fire up, and we are back to GTE's play of gold & other commodities (which does include housing, to a degree, by the way). So take everything I say here with a good degree of skepticism - I dont yet believe this myself, yet I acknowledge the possibility.
So in essence, I really am torn here by what the stock markets are doing. Either the market is really really stupid, and this is a panic, ignoring fundamentals (including a near certain recession)...OR...The market is really really smart, it sees deflation, and it is pricing in the upcoming loss of earnings the recession will bring...interesting times right now!!!
crt, just want to say thanks for your thought provoking posts.
crt,
Look at it this way: those who can afford the higher-priced homes are more likely to have significant investments in the markets, even if only in retirement funds. They are likely to get cold feet. Also, the higher amounts fo credit is going to be a problem. So the areas that haven't already seen huge price drops are likely to be the ones more affected.
As for the markets, I think it is a bit of both--I mean deflation as well as panic, the former reinforcing the latter. It is one thing for someone to say theoretically that he can withstand 40% drop in his portfolio but quite another thing to actually see it.
"Ted K said...
Look at it this way: those who can afford the higher-priced homes are more likely to have significant investments in the markets, even if only in retirement funds. They are likely to get cold feet. Also, the higher amounts fo credit is going to be a problem. So the areas that haven't already seen huge price drops are likely to be the ones more affected."
Ted - that is possible, but I could also make the case that the ones who havent had huge drops are more likely to retrench and not sell under any circumstances. Weve had a number of theories over the years - but the one constant has been, supply and demand never got nearly as out of whack inside the beltway as outside.
There is a story in the post today. Arlington & Alexandria had a large, very unexpeced increases in student enrollment this fall. The county officials explanation is people dont want to move away in tough times. I doubt that a bit myself, but who knows.
The point is, there is obviously some larger forces at work that have made close in areas more attractive (than they were in the past). This has been the case before the bubble, during the bubble, and during the busting. I see no compelling reason to think it will now change.
Ace - Thanks. Glad to know someone appreciates my random musings!
"The point is, there is obviously some larger forces at work that have made close in areas more attractive (than they were in the past). This has been the case before the bubble, during the bubble, and during the busting. I see no compelling reason to think it will now change."
Agree 100%. In the case of Arlington (22207), particularly those neighborhoods within walking distance of Metrorail, the premium location has allowed those neighborhoods to escape virtually all of the pain of the housing meltdown in the outer suburbs. High gas prices (yes, even at $80 oil) and never-ending traffic nightmares across the region are the best advertisement for 22207!
crt,
Frank Llosa of Franklyrealty shows on his blog that the contracts on upscale homes ( > $ 800K )in the DC area are already down roughly 50% in the last week. Although it is too early for a trend, that is a perfect example of what I was saying.
It remains to be seen how prices can stay high in the face of such demand destruction even if we assume some sellers will withdraw their homes from the market and thus reduce supply.
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