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Friday, May 1, 2009
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40 comments:
Cara,
looks like you may find a SFR in your price range after all.
http://franklymls.com/FX7045291
Ralph
Thanks Ralph, nice find!
It's on the major road, and in my least favorite elementary school district in the area, but still that one's tempting!!!
Thanks!
ralph,
and this one:
http://franklymls.com/FX7045091
has me tied up in knots. It's basically exactly what we're looking for, not on a main road, reasonably sized, not all tricked out, in Robinson. But it's $290k. Which means we don't have 20% down for it yet, and certainly not 20% down plus emergency savings plus money for new floors, refrigerator, paint. So close and yet so far...
But, given that this one sold for $470k!!! in 2006, and there's already been other REOs in the neighborhood, there will surely be more to come when we're ready, right? But at least from the listing, I like this house, this is almost at the ask mom for help level...
Hey Cara,
Just FYI -- if you find a place in a HS pyramid you are happy with, but not so much the elementary schools, you should know that FFX County has some cool alternatives. In particular, there are partial language immersion programs that are open to any child in the county, regardless of school boundaries (spaces are awarded via lottery). Near that house there is a German immersion program at Orange Hunt and Spanish at Ravensworth. If you have an extremely bright child, the county also has gifted and talented centers that are like mini-private schools starting in third grade (kids have to test into them).
There is information about all these programs if any would interest you at the fcps website.
GiGi,
That's not a bad idea. Strangely, I hadn't thought about it that way (despite it being obvious...)
What do you think of the second house? Someone needs to talk me down from this one...
In "it's gonna get worse before it gets better" news, from The Housing WireWant to see evidence of how rough things really are in Alt-A? Among 2007 Alt-A first liens monitored by Clayton, 33.58% are 60+ days delinquent, up roughly 5 percent from January 2009. And that increase came despite a 2.1% jump in prepayment rates, a 14.89% decrease in roll rates, and a 25% increase in the cure rate. (Think on that for a minute: cures are up, prepays are up, rolls are down — but 60+ day DQs are still rising anyway.)
That's a nice house Cara, I still think you'll be able to do better over the next year though.
The fireplace room is a little odd, it seems pretty narrow. And it's half underground which will cut out a lot of light. I think it would have to be seen in person to truly judge the layout.
Cara,
That's not a bad looking place. The one thing I'd say (if you're looking to be talked down :-) is that it's small -- 1040 square feet above ground, with 260 in the basement per tax records. That's smaller than many THs. In theory, you could add on since it's a SFH; however, there may be restrictions as it's located in Burke Centre. I know Burke Centre has it's own HOA with pretty comprehensive rules and covenants (right down to tree removal and shutter color, I believe). Perhaps someone here knows their policies on renovations/additions.
Otherwise, I'm always of a mindset of why not just check it out? If you like it, but it's not in your current budget and someone else hasn't bought it, make an offer that is in your budget. You never know, they might just take it. If not, you just have a bit more time to save and let other set the (hopefully more affordable) comps going forward.
Cara,
I like the second house too. Let me try talking you out of it:
Buying more than you are comfortable with and leaving you e-fund low exposes you and your family to risks. Do you want to live with your husband and children underneath an overpass just so that you could have that '70s tract dream house?
How did I do?
Ralph
Cara,
Compared to this, the one you picked looks a whole lot better. The yard is much bigger, too, and the deck is adorable.
I imagine cucumbers, peas, and beans growing up the back . . . For me, the house would be more acceptable with children than a townhouse.
But you have to see and smell inside. No question on that one. Is there really an overpass?
Cara, I should add that something like that place (if not that actual place) may in fact be in your price range come late summer when the market has slowed down. And, given what the fed had to say keeping interest rates at 0% this week, it doesn't look like they'll be hiking rates anytime soon. So locking in now is probably not a huge worry.
thanks guys!!
Ralph that was hilarious!!!
I think GiGi's plan is about right. This house is the sign that it's time to get pre-approved, and start looking more seriously. It's possible that they might take a lower offer, simply because this is one heck of a hike to the VRE on foot, so it should take more than 1 week to sell. But I should be just as happy if someone else buys it, because that will bring comps down another 20k from recent neighborhood sales. And I think Jeff is right, if I'm looking for non-updated stuff, there will be plenty more coming, with current ones bringing the prices down.
No, no overpass. Trying not to spend too much time in Blogland and ended up writing nonsense.
My real meaning is something like this: "if you don't have a fully funded emergency fund and are unable to meet your debt obligations should you or your hubby lose your jobs, then you may end up losing the house and having to live under an overpass to stay dry. Do you really want to expose your children to that for what's basically nothing more than an average house?"
Harriet,
Dude that's practically it's next door neighbor! And I had seen that one and not liked it, basically for exactly the reasons you mentioned (and their questionable renovation choices). The new REO is better, bet those folks are kicking themselves (funny how this one appeared just after that one closed, coincidence??)
In a variation of what Ralph/Jeff are saying, another problem is I could easily see a house this small, and over 1.5 miles to the VRE going for $200k in a year. Because, while I like the lot, both it and the house are tiny. Do I really want to beg my Mom for the $6k loan to flesh out the DP, (to be paid back from the $8k from Uncle Sam) just so I can pay $90k more than necessary for the privilege of owning this house now, as opposed to one down the street 6 months from now? Do I even want to pay $250k that I could easily do now? Not really...
Cara,
Just an interesting note on that house -- per tax records, pre-bubble it sold for $175,000 ... back in 1991. Using an online calculator I just found, adjusting for inflation in 2008 dollars, $175k = $273k. Now, I have no idea if the 1991 price was reasonable or if it's even reasonable to consider the house would increase in value with inflation, but it's interesting food for thought.
Anyone concerned about the rising 10-year rising and its impact on rising interest rates? If mortgage rates go up even 3/4 of a point, I think it will make people wait that much longer. My worst fear (worst case scenario) is that I buy a place, interest rates rise significantly and home prices in the mid-range ($450K - $650K) take the plunge that is expected. I noticed 30 year loans under $417K are still low, but the rate of jumbo conventional $417K -$6-something is rising significantly. Thoughts?
Anyone buy a new construction recently? Any thoughts on how best to negotiate (i.e., what % off list should you be asking or what % off any options you are willing to buy). Offer list on base + 50% options? The options seem hugely overpriced, especially on things like flooring, etc.
Thanks all.
Gigi: 1991 was the last bubble. My guess is that comparable houses in that neighborhood were selling for that same price in 1998
NoVAwatcher -- good to know. Thanks!
ZMonet,
About two-thirds of the way down the page, there is a 10-year bond yield chart and the author provides his opinion as to where interest rates are headed.
Specifically, go the paragraph beginning, "To this end, picture this..."
Cara, my two cents' input for your decision-making:
Try very hard to give as much weight to the longer term plans as the short term, and the positive as well as negative possibilities. Specifically, you really do not want to have to move twice if you within 3 or 4 years find you can afford more and need more space. Transaction costs more than wipe out any savings you are likely to enjoy. And the market may be awful or have very limited choices when you want to move again, to say nothing of the huge hassle of the move itself - packing, changing all your accounts, finding doctors, etc. in a new neighborhood.
If I were in your position, and if I didn't hate renting as much as I do (and you seem to cope with it much better than I did), I would rent a little longer and save up for a bigger house, making sure I had much more in savings for reno's and repairs and emergencies than I really thought I would need even in the worst case. A second best choice would be to overstretch now for a bigger house, gambling on the positive - that incomes will go up and that you won't lose jobs, and/or that you will work at least part time once a child arrives.
man, cara's all over the place. just buy T's place already!
Ace,
Yeah, this place would have to be someplace we would be happy to live in for at least 10 years for us to buy it. Which, given it's size may be questionable. The idea would be to be living in a smaller house in order to save money for more important things. And, if this doesn't feel too small, I don't think it would take that much money to make it feel like a nice cozy home.
I think the size and the full 2 mile hike to the VRE may nix this one even if I like it in person.
GT,
T's place is under contingency btw. I haven't congratulated or bugged him about it yet, because it's not a done deal, but it looks like he found a buyer.
tbw,
The one I'm mulling is in what I consider to be a good elementary school, the cheaper larger one on the mainish road is not.
That's a good point about socializing, althouh if they did do a language immersion type thing, that would necessarily draw from a larger region inherently, so they'd be in the same boat as the rest of their classmates.
Cara,
I take a very slow approach to buying things usually, to the exasperation of my wife. I do a lot of research and try not to let my emotions get in the way. I invariably find that places that blow me away at first glance fade as the days go by. It sounds like you approach things in a similar way and there are enough potential downsides to this place that a few days of rumination will ease that initial excitement. If you don't expect prices to shoot back up this year there's no reason to reach for a place that isn't perfect. It's a buyer's market!
ZMonet,
I think your concerns are very well-founded. It's hard to argue that this isn't a great time to get a mortgage. We have rock-bottom interest rates and an $8000 federal subsidy.
BUT...the downside is that if you try to sell your new home 5 years from now it's a certainty that buyers won't have access to such beneficial mortgages. Which means they'll be willing to pay less for your place. I don't think the great mortgages available now are a clear-cut advantage for buyers unless you're planning on living there for 20 years.
I'd like to solicit everyone's opinion on this.
Prices seem to be bouncing highers. For the last few weeks, it seems that houses are getting snatched up fast, and the "deals" are rare and quickly gone with multiple bids. How long will this last?
My thoughts are that there are two large factors manipulating this market. First, the $8000 buyers bribe, along with low interest rates, is pushing everyone off the fence. How many willing buyers there actually are and how long it will take to get a majority of them off the fence to effectively dry up the buyer's pool is anyone's guess.
Second manipulation is the moratorium of foreclosures, in additions to the swelling of withheld shadow inventory. These houses have to be put on the market at some point. Are they willing to hold onto them for years just to force us less-patient people to buy a house for more than we actually should?
I'd appreciate your opinions. I'm not concerned that there is any lost opportunity by having waited this long, I'm just p.o.'ed that the forces that be are interfering with the market correction.
Thanks Jeff,
Yeah, I'm hoping I won't like this one in person, and that it will fade as you say. Because, $290 per above ground square foot? For a 1975 house, is kind of insane. It's really the yard that makes this house.
But, believe it or not, I'm actually an incredibly impulsive person by nature, I just fight it really really hard.
Kevin,
It's painstaking, but do a visual inspection of the areas your looking in for bank-owned properties in the FFX county website. (by street) That doesn't tell you about the NOD's, or pre-foreclosures, but it does tell you about the immediate wave.
The one I'm talking about now was only actually bought back by the bank like 4/10, so I think banks that have inventory are attempting to move it as quickly as physically possible.
But yeah, how long will it take for the buyer pool to dry up is the $100k question right now (per house).
tiredbubblewatcher,
Agree completely about a person/couple's ability to buy. I couldn't own a cruddy SFH within 15 miles of my office and I make a decent salary. It makes no sense for prices to be this high. No way in the world that people can afford them without ridiculous loans. 3x income? Yeah, not in the past eight years. 20% down payment? Not like most people have 80k sitting in their accounts. Heck, most people have more in credit debt than they do in savings. This is all unsustainable and I wish the govt and banks would stop the manipulation. BTW, I know my observations might seem anecdotal, but they aren't refuted by any of the more timely measures of prices in the region. They're going up. Case-Shiller will report this in a few months, as it lags a bit.
I think it would be a temporary "bump", but certainly we'd hear a lot of people calling it the market bottom. But again that goes back to my two combined theories as to why: buyers' bribes and withholding the foreclosures. The bribes end at the end of the year and the foreclosures should start surging on the market again (hopefully soon), send prices tumbling hard.
But I'm with you. If the best that 3x my salary will get me is some dump an hour away from my job, screw it, I should move somewhere else. I've just never considered leaving this area since all my friends and family live here, and don't know if it's worth having a larger house to give all that up.
Kevin, what areas are you looking in? Sorry if you've said this previously and I just don't recall seeing it.
FWIW, franklymls is sending me about 1 notice every 4 days or so showing a price drop of a SFH house in Arlington. Of course, IMHO, these houses were grossly overpriced to begin with and so the reductions still aren't bringing the price into the reasonable range. But I see that, plus some recent sales of flawed but generally good houses at very good prices, to be a good sign. From my anecdotal observations, sellers who need to sell are doing so at prices much lower than during the peak periods; the houses that sit are doing so because the prices are too sticky relative to the value, suggesting that the seller still believes things are going to get better and doesn't have to sell right now. There are a lot more of them (at least in certain price ranges) than the sellers who are making the deals. But in a few more months we should know who is right about the market.
Kevin, TBW,
I'm in agreement regarding the local market. I won't be owning a house in this area if this is the bottom.
We just signed a new lease starting June 1 for a 2BR house in Vienna at $1750. I think $1750 might be a little on the high side for an equivalent house in that area but we really like the place. We'll see how the market plays out this year before deciding on whether to stick around NOVA.
Ace,
I'm seeing the same thing in my FranlyMLS alerts for the Arlington and Del Ray zip codes I watch.
Kevin,
Not everyone needs to have 20% down in this market. Lots of military people are using their one-time VA loan option, which means 0 down payment.
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