Continuing to examine and hold a lively discussion of the Northern Virginia Real Estate market.
Please post your local house search updates, MLS finds, on-topic ideas, and links here.
Va_Investor said "If you want the economy to collapse, just come out and say so. Why would you think that you will be one of the survivors? Perhaps you and TBW should have a pity party OR find a way to increase your earnings."Care to back up such a baseless claim? Where have I EVER said that?
I will chime on yesterdays conversation. I think a huge reason that Arlington is so much more valuable than other areas is traffic. A lot of the rich people work long hours and want to be home with there family as soon as they get off work. If some how a miracle happened and traffic improved and 66 was 6 lanes wide, I think Arlington prices would fall because you could live 10 miles away and still only have a 15 minute commute. Seeing that there is very little chance of this happening people will continue to pay millions so they can live in a nice area with good schools and a short commute
Out of curiosity have any of you heard about the mosiac district? I was walking to dinner yesterday and I saw a sign talking about it decided to see what it was. Apparently they are trying to revitalize the Dunn Loring so make it much trendier/less runn down looking. https://www.cbremarketplace.com/4884/CADocCenter/Mosaic%20District%20ES_CA.pdfThe thing I found most amazing was there claim that if you look at the 5 mile radius around Dunn Loring the median family income is $174K. No wonder housing is so expensive near the orange line. We have always been trying to get the numbers to work with the an average income of ~$100K and said housing is expensive. If you say the income is $170K than the house prices seem very reasonable
Calculated Risk is now positively pleading for the $8k to die.He has really good arguments too. The most persuasive to me was the idea that since commercial real estate is the next default wave for banks already, a stimulus that moves households from renting to buying is a terrible plan right now, and could make a bad situation worse.In my perfect world every law maker has at least one staffer dedicated to reading Calculated Risk. Sigh.
Has anyone considered that they should phase out the credit? Maybe extend it for 6 months at $4,000 then another 6 months at $2,000 then eliminate it in 2011 totally? Generally weening off of things like this is the best way to do it.
housebuyer,It looks pretty. I'm not sure we really want something else quite that close to Tyson's, but at least it's metro accessible.I'd be curious to know where they got that figure for the income. I'm not sure that a RE developer's flier is the most reliable source for information, but McClean is within their 5 mile radius, I think, so it could very well be true.
Jeff,That was my suggestion. It's how they did the hybrid credits. Someone this morning on NPR essentially made the suggestion that you only offer it to folks who are buying REO's or short sales. That would be a lot more targeted and hence less expensive.If it were only for REOs and short sales I'd even be okay with them giving it to investors who aren't flippers, i.e. you don't have to be a first time buyer, and you don't have to have it as your primary residence, you just have to own it for say 2 years or give the credit back.There are many ways the credit could be made less destructive. I'm not holding my breath for any of that to happen.
housebuyer, that begs the question: if something were done to drastically improve traffic, like widening 66 up to 32 lanes, would that tank the prices of Arlington?I tend to agree with your theory though. It's simply unbearable dealing with traffic around here, and the higher rollers will pay a lot of money for a dingy little SFH in 22207. I think this is probably one fundamental about Arlington that has changed in the past ten years, driving up household GDP in the area. Just my thought.
Cara- I am pretty sure the figures actually came from a study done by Fairfax county in 2000. Either way even if it is not true it probably is closer to 175K than 100K. This area is obviously one of the wealthier areas in Fairfax...
Jeff/Cara,My fear about letting the credit slowly roll off like that is that the market will start to tank again, and they'll use the "new" finish line of this credit as a launching point for a new, more awful one. Now, you could argue that it really isn't different than just letting this one die, and they would do the same thing anyway. Perhaps. But with a lingering deadline hanging on the horizon, sell-outs like Senator Isakson would love to turn the deadline into the birth of something even more outrageous.
Kevin- I am pretty sure traffic has been really bad here for well over 10 years. But yes I think alleviating some of the traffic issues would bring down prices in Arlington although I have no basis for this claim.
kevin,Having a staggered phase out would indicate that law-makers understand that it must die sometime, that it cannot continue indefinitely without serious negative unintended consequences. So I would view a phase out as a level of seriousness that has not been shown recently.Isakson hasn't sold out, he was a realtor himself. That's not selling out that's being true to ones roots. ;)
I don't know my geography, but is Arlington really all that different than close in neighborhoods around NYC, Chicago, or Dallas?Isn't this why the three rules of real estate are location, location, location?Stop me if I'm wrong, but isn't the theory of location, location, location, that if you plunk down $500k on a house in Arlington vs. a $500k house in Ashburn, the Arlington address will outperform Ashburn on a relative basis. (i.e., Arlington would see a 10% gain over 5 years, whereas Ashburn might only see 8%?)
Cara said "Isakson hasn't sold out, he was a realtor himself. That's not selling out that's being true to ones roots."Quoted for truth. I wish there were a concerted movement to get this guy out of the senate. He is such an industry shill it's shameful. They reaped bubble profits, now are pushing for billions of taxpayer dollars to keep their gimmick humming along like the bubble never stopped.
Kevin,From yesterday:"Cara, I could stomach the tax credit for new hires thing. That's probably because I haven't thought long and hard about it, or am so utterly enraged and beaten by the home buyer tax credit that anything in comparison sounds brilliant.""Robert,That's great if the rates start rising. Let's hope they can climb and stay high."I supppose that you do not want the economy to recover until your dream home has dropped 70%? Do you honestly fail to see the correlation between a housing recovery, interest rates and the General Economy? Or, are you too blinded by personal circumstances to view the entire picture. Be careful what you wish for.
Robert,Arlington and DC in general has a suburban/urban feel that some of those cities are lacking, but other than that yes. And Chicago has more places like McClean than it does like Arlington.But those inner city posh areas have always been out of reach for me so I've never checked whether they actually appreciate faster, not just are more expensive. Sadly I don't have time today to go look for stats on that, someone else will have to do it if they're curious.(my argument against it would be that a barrier to entry should make transactions less frequent which could slow the growth of prices... but the data would show us if we could find any we consider "normal" or "representative".)
Cara,Not to beat a dead horse...but I will.The only reason that I finally put out neighborhoods where I was buying was to de-bunk statements that only garbage in slums had the huge discounts that would make them attractive to Landlords.I believe that you had made most of those remarks. (recall my comments about collateral damage).And no, I don't buy rentals for any altruistic desire to house the masses. I do it to make money - just like any other job or investment.
I think they ought to tighten the 8,000 bribe somehow, someway. I know this blog is about NOVA housing but guys as a seller wanting to retire and relocate, I'll reinetrate one for time. This housing slump/debacle/baloon bust or whatever DID NOT happen in every state or city. The majority actually saw price increases even in Va. where PWC, and Va.Beach/Norfolk area inploded, it didn't across the state. Bubble prices or not housing is expensive and the bribe just drove prices up even in areas that weren't in crisis mode. I'm at the point where I have to delist or lower my price. Well, guess I'll be delisting for a year or 2 because I have to wait till the bribe disappears and/or other states catch up with the vast devaluation undergone on the coasts. Housing aint cheap in comparison price cost per sq. ft. anywhere.
Va_investor,Seriously? You're mad at me for not being psychic? And not finding examples of cash-flow positive rentals in good rental areas myself, when they are 23 miles away from where I'm looking? It's a dead horse alright. Let it never be said that you can't hold a grudge. If there were an olympics for taking offense or holding a grudge you'd win.
Va_Investor said "I supppose that you do not want the economy to recover until your dream home has dropped 70%? Do you honestly fail to see the correlation between a housing recovery, interest rates and the General Economy? Or, are you too blinded by personal circumstances to view the entire picture. Be careful what you wish for."I see homes falling no matter what. You can keep rates low for only so long, delaying the inevitable, while guru VA investors think they're hot shit scooping up "deals", then getting fleeced when the market corrects. The question is how many people do YOU want to see underwater?Your argument comes down to "bring back peak bubble prices". After all, isn't that the cornerstone for a recovery and the general economy? You are living in a fantasy world of golden rainbows, a v-shaped housing market bounce, and housing bubble riches. I am on the sidelines patiently watching a market correct, basing my actions on my beliefs. I truly believe that this market has not corrected, has a way to go, and our tax dollars are being pumped into the bubble to lure people into the game and end up underwater. Pardon me if you think it's selfish not to want to fall for that trap.
Let's hope rates stay really low so VA Investor never sees anything but a substantial profit. God forbid if massive inflation rears its ugly head and we're paying 20 bucks for bread that they don't raise the rates substantially and hurt VA Investor's bottom line. Let everybody starve, just don't eff with his property's value.
Arkey,Yeah, it's a serious problem. Designing a one-size fits all "solution" to housing, that doesn't help anywhere other than maybe Phoenix and the lower cost areas of CA can wreak havoc on areas that never had a bubble in the first place.Thus, limiting it to REOs would be a really good step. The existance of REO's would indicate that there was a problem with the market that needed help to recover from, and the pervasiveness and perniciousness would be a lot less. Of course if it's just for REO's they hardly need one, they have a stimulus, it's called low prices. But cash on hand to fix them up is nice I guess. I could live with it anyway.
Thanks Cara, I try to keep my anger under control but sometimes the governemnt really gets under my skin. I don't have anything against first time homebuyers that's for sure but I really don't understand why they should get tax dollars, low interest rates and houses at bargin bin ( foreclosures and SS)prices while everyone else picks up the tab for their good fortune.
Arkey,Then whatever you do, don't listen to Isakson on NPR this morning. NPR has been basically touting the $8k the last two days, it's very strange to me... OMG, my paraphrase was "if you compare the cost of the $8k to the largest single outlay of money the US has ever done, then it looks tiny!" Save us.
Kevin,Actually, high inflation would be terrific for me. And I have never predicted a V-recovery. In fact, I've stated the opposite; that this would look like the 90's all-over again, namely years of stagnation.Housing is the back-bone of our economy. I have no desire to see it rebound in a V, but further significant decline will be catastophic. Consumer confidence, and thus spending, is dependent on people becoming once again secure in the basis of their wealth; ie. House prices, which tie directly to the vast majority of net worth.I certainly am not relying on a V. I've bought recently because it made sense. I'm not a fortune teller. If I can't sell for ten years I don't really care. I am an investor.So I don't want the economy to collapse; why would anyone? Why do you want higher interest rates? Oh, they will rise alright and that is one reason I am glad to be locked-in. Inflation will reduce my debt costs while increasing my rental income.I gather you don't see the economic benefit of the "buyer" bribe? Think jobs. Furniture, appliances, paint, insurance, construction. Think societal. Boarded homes and derelict neighborhoods rejuvenated, increasing property values and tax revenue. How about the "forced savings" aspect of homeownership?You premise your comments/predictions on falling house prices. You think this is a bear trap. Well, you are certainly entitled to your opinion but you seem to want gov't policy changed to achieve that prediction. This would involve more pain to the general economy, would it not?Don't be concerned about my situation. I am concerned about friends and family if this stimulous fails. Why do you want it to fail?
Ok Cara, I'll take a pass. I'm no housing guru for sure but I think the ones that really need help whether thats forcing banks to renegiotae loans or whatever in those buyers that bought way beyound their means. If it means giving them a 40 year mortage at 6% so be it. I can't see letting them completely off the hook but its hard for me to believe their isn't a profitable means of working this issue out between homeowners and lenders. A foreclosure costs a lender alot of money right off the bat that could be applied to the loan its self or the interest rate buy down. Maybe take the 8,000 and put it in a pot to due just that. At least I have a home that I don't have to sell and I do love so I'm ok with not retiring until I get to be 60 or so. By then if this mess hasn't cleared in our area, it will be mess everywhere and I can sell knowing I can buy in any messy old part of the country I wish.
arkey,The only viable, one-size fits all option for relieving the debt burden on over-extended homeowners is fixing their rate now, and inflating their debt away...
Cara,Having a good memory and "holding a grudge" are two entirely different matters. If you were not familiar with various areas, perhaps it would have been best not to comment.I apologize if I read too much into your remarks and take misguided offense to certain comments that seem to be "holier than thou".
Arkey,Based on previous posts I'm not sure delisting and waiting for prices to come back to what you think your house is worth is the best strategy. Most of the studies have placed that bubble break-even point several years out. Why not just take the loss now so you can retire in peace?
I've heard the pieces on NPR about the $8k and I thought that they were pretty good -- they had a person from the Center for American Progress who did a good job making the argument that about 4 out of 5 homebuyers who took the $8k would have bought a house anyway. Really I think the main effect might have been to give cash to people to do minor remodeling, painting, buying furniture, etc. So maybe Loews, Home Depot, and furniture stores have good lobbyists. And maybe you could argue that that's good stimulus. But why not have a similar program for renters (or people who already own a home) where you can get a nice 5% loan from the gov't to buy iPods, TVs, clothing, etc? :)
Va_Investor said..."Actually, high inflation would be terrific for me."I know it would, which was why I was mocking your incredibly selfish position. You probably couldn't care that the lower class would be starving or freezing to death. Just keep rates low so it helps your bottom line. Which is why I found it remarkable that you could accuse me of schadenfreude. "Housing is the back-bone of our economy… Consumer confidence, and thus spending, is dependent on people becoming once again secure in the basis of their wealth; ie. House prices, which tie directly to the vast majority of net worth."The housing bubble is the most harmful thing that has happened to our economy in decades. You're arguing to bring it back. It's the correction that is necessary and unavoidable. Housing is NOT the backbone of our economy any more than it is the backbone of India's or Columbia's economy. You are simply repeating talking points from industry propaganda machines. Production, innovation, and entrepreneurial spirit are the backbones of our economy. The only thing that housing has become the backbone of is SPENDING. We're spending far too much because the whole RE market is bubbled to the point it's suffocating us. "So I don't want the economy to collapse; why would anyone? Why do you want higher interest rates? "Again, stop putting words in my mouth. I do NOT want it to collapse, but you're delusional if you think we can obtain a standard of living like we saw a few years ago. We have to be realistic and let these markets correct. Stop delaying the inevitable. That spreads the pain to millions more. I see higher rates as inevitable as well. I'd rather be buying when the rate is at 8% than now when it's at 5%. There will be a corresponding market drop of roughly 25%, all other things being equal. This is an artificially inflated market. We're risking inflation for temporary bubble equity that is unsustainable in the long run. That's f-ing stupid."I gather you don't see the economic benefit of the "buyer" bribe? Think jobs. Furniture, appliances, paint, insurance, construction. Think societal"There are no benefits. It helps the RE industry. They deserve nothing, and are swimming in pools of cash made during the bubble. It is causing a stir of demand, driving up prices and creating bidding wars. People are paying more for houses than they would if there were no credit, and by an amount higher than the credit. No person with a room temperature IQ or above can believe that's a good thing. It's adding tens of billions of dollars to our national debt, enslaving future generations to pay for these industry bribes. And again, it does NOTHING in the long run except put more owners underwater. There is no benefit. I know you think "free money is awesome", but I find it financially absurd and morally reprehensible. Sorry if our values can't intersect here, but I have faith that an economy and society can exist without massive bribes for people to buy homes. "You premise your comments/predictions on falling house prices. You think this is a bear trap. Well, you are certainly entitled to your opinion but you seem to want gov't policy changed to achieve that prediction."Is that a joke? No, I don't want "policy changed". Fact is that the govt is working overtime creating policy to reinflate the bubble. You seem to accept this as the status quo, I do not. I see this as malicious interference. You're the one that wants policy changed to reinflate this dead cow."Don't be concerned about my situation. I am concerned about friends and family if this stimulous fails. Why do you want it to fail?"I didn't say I wanted it to fail. STOP. PUTTING. WORDS IN. MY MOUTH. I said it is futile in the long term, and just spreads the pain. You want your friends and family to ride high on bubble equity wealth. You are delusional.
Also, assuming I'm wrong about the inevitabilities, there would then be no need for the govt to be bribing people into buying houses. When owning a home brings a massive tax benefit, prices are "deals" as some believe, then why is the govt using the money of future generations to buy houses? If you have to be bribed in order to buy a house, it is not a positive thing.
Hi Jermey, It's not wanting to sell low and buy high. To me that is not a smart retirement move. Sure if prices were dropping everywhere like here where I could sell low and buy low it's a wash. But in areas where (home in particular) that holds any appeal over retiring in place has had a 5%increase in housing prices this year. Doesn't bother me in the least to wait until everything evens out.
Kevin,The "bubble equity" is gone, done, overwith. Anything further is an over-correction. If you expect prices to go back to 1999, then that means 1991. I would suggest you look at increases in various areas vs. your desired area. Low income crap went up 2 or 300%. Did the area you are looking at increase that much?The truly "bubble" gains are gone, for the most part. If you have data to the contrary, please post it.If your true concern is that the lower class is freezing or starving, I suggest you investigate the transfer programs currently in effect.
Va_Investor said "The "bubble equity" is gone, done, overwith. Anything further is an over-correction.If you have data to the contrary, please post it."Um, not everybody agrees with that sentiment. In fact, I'd like it if you can back IT up with any sort of quantifiable evidence before challenging me to. But since I believe I do have the evidence, I'll offer you my contradiction:linkWe are nowhere near correcting. Housing prices don't triple in a decade, fall by 30%, and then become "overcorrected" just because you say so. Even if you adjust these figures beyond inflation and take into account the household income differences over time, we are nowhere near correction. You have a mental block going on. You're desperately clinging to this imaginative notion that we weren't really that overinflated. Well, however you can convince yourself that a threefold increase in housing values requires only a slight correction is either a feat of mental gymnastics or a complete ignorance of how these markets function and trend.
Kevin,I don't really think that the entire MSA is relevant. Yes, certain sub-markets went crazy. But many of these have seen corrections of 70%. Show me a valid (not low income/hispanic fueled) neighborhood that increased by the margins you site. I can only comment about neighborhoods that I am directly familiar with AND they have reached rental parity (or, for higher priced neighborhoods, have relinquished any "ill-gotten" gains).It is completely disingenuous to claim all regional areas experienced enormous bubbles. For many, 10-20% declines is all that is necessary to be back in line with historic pricing.
Va_Investor, First you challenge me to come up with data to back my point without providing ANY of your own to back up yours. Then you challenge me to break it down further, which I would do if I had the link bookmarked on this computer, but I don't. Now you want to be a douchebag and call ME disingenuous? I'm sure Cara or somebody else here has the link to the different counties in this region and the prices tracking back several years, perhaps they can post them. We've gone over it here in the past. They have gone up by factors from 2.5 to 3.5 everywhere. Go look at anecdotal cases in the tax records of any municipality. I'll do it for my old neighborhood as an example, in 22030 (not hispanic-fueled, you bigot):Sales HistoryDate Amount 09/21/2006 $335,00011/21/1997 $130,000Increased 257% over nine yearsSales HistoryDate Amount 03/01/2006 $400,00003/06/2000 $151,000Increased 265%01/30/2006 $391,00003/30/1998 $139,114 Increased 281% 12/16/2005 $420,000 09/21/1998 $158,385Increased 265%I'm spending my time backing up my claims with data. Time you do the same and stop being such a clueless dick.
"We are nowhere near correcting. Housing prices don't triple in a decade, fall by 30%, and then become "overcorrected" just because you say so."First off, it strikes me that you need to specify certain locations. Parts of PWC have fallen 50%.Second, if prices "tripled in a decade" and it's fallen by 30% then it's down to the "double in a decade level" which may or may not be too high depending on the area.I'm sure you understand that if a house drops from 400k to 200k then it fell 50% but in order for it to get back to 400k, it has to go up 100%.It just seems to me that when you make arguments on percentage increases/decreases, it's very difficult to prove anything. Has PWC gone down enough? Has it bottomed? I would guess yes. Has Arlington bottomed? I would guess no as it's months of inventory levels are so high. Perhaps people there can wait a decade for prices to start to return, I have no idea. Certainly if people are wealthy enough, they can wait it out for a long time and that would force the price to plateau in that area for a very long time. I mean who's going to spend 800k there when something bigger and cheaper isn't that far away?
Sorry Kev,Zips don't really matter. Where, precisely, are you looking to buy? I could show you Herndon 20170, but there are huge distortions. I can't think of the name of the TH development that went from low 100's to mid 300's then back to 80's and now 130's, but you get the point.My neighborhood peaked at 1.2 and now is probably about 1 mil. We had a huge bubble of 900K to 1.2; how much is that? 30%? So we retain 10% over 2002? Bubble?Frankly, you have to be "on the ground" to really evaluate pricing. I'd be very surprised if what you want to buy is really that much higher than what might be expected.I have numerous examples, but I gather they are worthless because they are (god forbid) anectdotal. Perhaps just as worhtless as zip code stats.
"Housing is the back-bone of our economy"I sure as hell hope not. That would mean we have one shitty economy. Selling houses to eachother -- that's a great plan until the music stops. Cripes, how many houses do we need?I remember when we used make things and export them to other countries. That needs to be the backbone of our economy.
Sorry watcher,This seems to be the heart of the problem right now.
I just looked up some stuff and there are tons of houses in PWC that are selling significantly lower than peak. Most of these townhouses and small SFHs are easily affordable right now. Of course, they're also selling like hotcakes. This came from a small SFH.PREVIOUSLY SOLD PRICEDate Sold Price Subsidy Net Price2/15/2005 $335,000 -$7,000 $328,000CURRENT LISTING PRICE HISTORYDate Price % Change Days at Price7/17/2009 $149,000
"Jeff said...Has Arlington bottomed? I would guess no as it's months of inventory levels are so high."Dont you mean the reverse? Arlington had the lowest months of inventory for the entirety of this crisis. Its only now that the other areas have settled back down to have a similar low months of inventory as Arlington.
Anon?http://www.virginiamls.com/charts/Arlington.htmhttp://www.virginiamls.com/charts/PrinceWilliam.htmThese are the numbers available. PWC seems to have returned to the pre-collapse levels while Arlington has not. I'd have to check the sales numbers for Oct when they come out but I'd guess that the number of houses sold in Arlington are not keeping up with the inflated supply (compared to pre collapse).
Anon, I looked down at the sales price chart and it looks like you're right for months of inventory but as far as total inventory it hasn't settled back down for some reason. Nova is essentially in recovery right now. I just don't see prices falling further although Maryland will probably see some.
Jeff - you are citing total inventory which is a slightly different animal. Months of Inventory (MOI) exploded then crashed outside the beltway, whereas simply rose and maintained in Arlington.Heres a 5 year comparson for August2005Arl 1.66 MOIPWC 2.62 MOI2006Arl 4.15 MOIPWC 9.90 MOI2007Arl 4.21 MOIPWC 14.13 MOI2008Arl 3.70 MOIPWC 5.60 MOI2009Arl 4.13 MOIPWC 3.92 MOIInterestingly, it was only once PWC started seeing 5,6 & 7 MOI numbers starting last summer & fall that the freefall stopped.
8412 White Feather Ct. Lorton10/08/2008 $195,00005/22/2008 $215,46602/13/2006 $330,00012/02/2003 $207,90003/18/1993 $114,500 05/10/1988 $93,500 20 YEAR GAIN: 108%8550 KOLUDER CT. LORTON, VA06/10/2009 $185,000 05/01/2009 $166,716 10/24/2006 $306,900 12/27/1993 $113,500 12/12/1988 $112,800 21 YEAR GAIN: 64%Interpret as you wish.
"Jeff said...I looked down at the sales price chart and it looks like you're right for months of inventory but as far as total inventory it hasn't settled back down for some reason."Jeff -- yeah, MOI are now comparable, but total inventory are not. This gets back to CRT's long asked question, what number of homes available constitutes "settled back down"? It could be that PWC is normal and Arlington is high, or it could be that PWC has overcorrected, and Arlington is normal.Clearly, the bubble years inventory was too low, but what constitutes normal? I only wish somebody knew...
what does "Potential Short Sale" in the listing really mean?and what about "Bank Approved!"?thanks!
Can anyone recommend a good realtor in the Orange line (aka "Orange Crush") area of NOVA?
Hi MM - I wondered that myself many months ago.A listing might state that there is a "potential short sale" because, under current market conditions, it is unlikely that buyers will offer a price that matches or exceeds what the sellers currently owe on the house. The sellers are selling "short" of what they owe. A "potential short sale" implies that the process of getting the bank's approval for the asking price has not yet begun. This can take several months. So, selling short can take a long time."Bank approved" gives buyers less hassle, because the bank has already approved the asking price. It's even better when only one bank is involved.
http://www.recharts.com/The data you'd be looking for can all be found at the above link if county wide data is sufficient for your purposes. Or you can look at the mris site for individual zips, links are at every 10th of the month post.Va_investor,You say tomatoe I say tom-ah-toe.Your memories and my memories do not align any better than our communication abilities do the first time through.I look at it this way. There was a disagreement on the board as to whether there were properties priced attractively to landlords within the semi-inner ring. I said there were and pointed some out near me, others called them slums, you took this as people saying you were a slumlord. Maybe they even did say that, I don't remember. The argument was settled when you pointed out the properties that you purchased and it was widely agreed that at those prices they were indeed good deals for a rental property and in a good location. It's a settled argument, it's been discussed and sorted, why would you bring it back up?Randomly bringing up old fights that have reached a resolution, seems like a grudge to me. Yes, Leroy has you beaten hands down on this.
Anon, that's an interesting question, has PWC over-corrected or has the rest of the area not corrected enough? We'll have to wait months (or even a year or two) know from the numbers. My guess is that PWC over-corrected some and the rest has not corrected enough yet. The meeting will probably be someplace in the middle. Of course, I'd love to be wrong and PWC inventories to drive up prices even more in the county since i own in the region. :)As far as the short sale question goes, read the person above me first and this will help explain it a little better:Basically, the person is trying to unload the house for less than it's worth. You owe 300k on your house but the market will only bear 230k so you market it below your loan amount. Someone makes an offer (this would be you) of 200k and the offer goes to the bank. The bank takes months to decide to say yes or no (that they're willing to take the loss). If the home owner has a second loan then a short sale is nearly impossible because getting both banks to agree almost never happens and the house will go into foreclosure. You could buy it after the foreclosure although by that point things can happen. For instance, the bank shuts off the power (the dumbest thing in the world to do if you're trying to maintain the value of your property) and many houses have sump pumps that run on the electricity. So the basement floods, mold grows, and the house goes down even more.
Both sold for roughly the same price in 1993, so it might be reasonable to assume that they are comparable units.1988 was a bubble year, so the higher December prices for Koluder would back that up.Both peaked in the low 300s in 2006.Someone flipped the Koluder home earlier this year. The most recent sales for both are at around 60% of the peak price.I guess once you remove the bubble, the NAR commercial that states that housing prices double ever 10 years is once again found to be wrong.
Re: Arlington inventory, MOII am a believer in the notion that all real estate is not only local, it's MICRO local.For most of 22204 and 22206 and maybe certain parts of other zips in Arlington, sales prices and volume have been in many ways similar to what we've seen in PWC and other counties - maybe not to the same extent but the trend is similar. More foreclosures, more price drops, now more sales, etc.In higher price ranges (e.g., $800+), there is a lot of inventory that has been on the market a long time. Big price drops before selling are common but not universal. In lower to middle price ranges, sales and prices seem to be in-between. Homes aren't sitting unless they are grossly overpriced, but buyers aren't frenzied either. Some neighborhoods seem to be holding steady or increasing in price slowly; others are still dropping slowly.When all of Arlington is lumped together I think the picture is murkier.
MM,What REdealSeeker said. But I would add, that "bank approved"'s are not all the same. A bank can approve the process without approving the price. Have your agent call the listing agent and find out if there is a bank pre-approved price and timeframe in which it must close. "bank approved at list price, just needs a buyer, can close quickly!" are the best if the bank's price is an acceptable one to you. You can check if the agent has closed any other shorts using the links at frankly (they just perform a search for that person's name and real estate agency). Ljuva Corbett Jobin Realty
Yes, well, Cara it was you.up until you decided it was time to buy. I'd say "passive-agressive", but I won't....
Jeff: "First off, it strikes me that you need to specify certain locations. Parts of PWC have fallen 50%."All areas rose *roughly* the same amount. As in, prices didn't triple in PWC and go up a mere 20% in Arlington, as VA Investor seems to be implying. They more than doubled in every location."Second, if prices "tripled in a decade" and it's fallen by 30% then it's down to the "double in a decade level" which may or may not be too high depending on the area."You think that prices should double within a decade and that there are fundamentals that support that absurd increase? Um, okay, tell me where that's happened before."I'm sure you understand that if a house drops from 400k to 200k then it fell 50% but in order for it to get back to 400k, it has to go up 100%."Of course I understand this. I don't even know why this needs clarification."It just seems to me that when you make arguments on percentage increases/decreases, it's very difficult to prove anything. Has PWC gone down enough? Has it bottomed? I would guess yes."That I can agree with you on. We've all more or less agreed that certain areas (the hispanic-dominated, as VA Investor would put it) fell back to Earth quickly and were showing signs of natural growth again. This is a good thing, and I wish it would happen everywhere so more people don't get screwed by catching a falling knife.
kevin:A little dated and limited to the beltway outward (all I care about, really), but the graphs at the very bottom show that the various areas rose at roughly the same rate:http://novawatch.blogspot.com/
Here is an example of a short sale with a erratic pricing history, and a long time on the market, however, note that it eventually did close: http://franklymls.com/LO6911648I went to see this property when it was listed at 399k in early June. The listing agent had given my agent the impression that it was an approved short sale. I had assumed that the price had been approved, and felt irked when the price was raised shortly thereafter. But Cara makes an important point that the bank's approval of the short sale does not mean that the bank has also approved the asking price. That's probably what happened with this house (never mind that it really sold for less than the 399k asking price, when including the seller subsidy).Glad you pointed that out, Cara. Next time I see a short sale, I will ask if the price, as opposed to the process, has been approved.
Va_investor,Given that I started looking in earnest this spring, that means that whatever insult you're bringing up is almost a year ago now. Think about how much more we know about each other since then.You and I have different concepts of what the purpose of conversations are. I think this blog is about gaining a better understanding of the situation as it evolves. That can incur fights, but the purpose of those fights is to reach resolutions and discover things we wouldn't have discovered if we didn't hash them out. As far as I can tell? For you the purpose of those fights is to find someone upon which you can vent off steam.If I was trying to stir up another fight, then indeed my words would be passive aggressive. Since what I constantly keep trying to do is reach consensus and tamp down unproductive fights, it's peace-making. And I'd say I'm pretty darn aggressive about it.
Va_Investor said "Zips don't really matter. Where, precisely, are you looking to buy? I could show you Herndon 20170, but there are huge distortions. I can't think of the name of the TH development that went from low 100's to mid 300's then back to 80's and now 130's, but you get the point."I just used that as one example, a personal one. Go ahead and do your own research and actually provide data for a change. You seem to demand a lot from me to prove something yet provide absolutely NOTHING on your end. I've already spent too much time giving you your Nova Bubble 101 lecture for the day."Frankly, you have to be "on the ground" to really evaluate pricing. I'd be very surprised if what you want to buy is really that much higher than what might be expected."Maybe, but I have seen no compelling data to the contrary. If under higher rates and no buyers bribes the market were to hold stable on its own, then there might be some meat to that theory. And then, after having seen this actual evidence of what should be a safe market would I advocate one to buy in it. See, ya don't just shoot from the hip on the biggest purchase of your life. Give it some thought, look at the data, and don't run with cockamamie notions like your "we're overcorrecting" b.s."I have numerous examples, but I gather they are worthless because they are (god forbid) anectdotal. Perhaps just as worhtless as zip code stats."If you have numbers, you sure are afraid to show them. So let me get this straight: I show the regional price increases, and you arrogantly demand more micro segments. I show you a micro segment, and you call it worthless. Are you trying to antagonize me or are you that thick headed?
NoVAwatcher said "A little dated and limited to the beltway outward (all I care about, really), but the graphs at the very bottom show that the various areas rose at roughly the same rate"Thanks. I've lost a lot of my old bookmarks from my last work PC, so it was hard for me to pull the by-town data. I knew that there wasn't too much of a difference though, from what I recalled. I know VA_Investor wants all evidence on the fly from us, but we've discussed on this blog before the differences in the counties around the area. For instance, I conceded to CRT a while back that Arlington in fact might not fall as much as other counties due to the substantial household GDP increase there over the last decade. "Housing is the back-bone of our economy... I sure as hell hope not. That would mean we have one shitty economy. Selling houses to eachother -- that's a great plan until the music stops. Cripes, how many houses do we need?"It's not. People that say that garbage are those who work in the industry and want to believe they're the life blood of this economy. In this case, a bitter house flipper that thinks a housing bubble is the cure for the economy, not the bane of it. Talk about naive and self-serving. It's sort of ironic that the people most actively involved in real estate are in fact the most clueless about it. I blame groups like NAR that promote ignorance and a lack of objective analysis on the industry, as well as a fanaticism and "prices only go up" mentality that their substandard-IQ sycophants can promote to the populace. Cara said... " http://www.recharts.com/ The data you'd be looking for can all be found at the above link if county wide data is sufficient for your purposes. Or you can look at the mris site for individual zips, links are at every 10th of the month post."Cara, you're fantastic. I knew you would have that! Hey VA_Investor, put down your glass of flipper koolaid and get reading up on some data. Charts speak for themselves. Maybe some day you can catch up to the rest of us and not waste our time picking fights due to your ignorance. kthxbye!
kevin,the one I posted is also linked to on the front of this blog, it's just buried under regional blogs or something. It has the maryland and DC data in it too, but is labeled Virginia. In some cases they're just graphing what's provided in other sites.Jewel, You asked for Orange Line Real Estate Brokers? Have you considered Frank Llosa of frankly.mls.com fame? Just pointing out the obvious.contrarian,re: CNBC. wow. just what the world needs... Who knows, the advice in their could be good, I started out my process with similar websites.
Cara said... "Jewel, You asked for Orange Line Real Estate Brokers? Have you considered Frank Llosa of frankly.mls.com fame? Just pointing out the obvious."I did contact someone from Frankly. We want to get a handful of people to interview, so we can choose right realtor for us.We know a few people who have bought in the area, but they chose realtors whom they were related to or friends with, not ones based on their knowledge and/or competency.
Jewel,That's a good plan. My agent is Jeff Royce from Frankly, who I'm extremely happy with so far, but who doesn't specialize in your area, so I don't have any other recommendations.One thing you could do, is look through solds on frankly for buildings or areas you're interested in and see who the selling agents (i.e. buyer's agent) were. You'll be able to see who's willing to deal with short sales, who has been lucky or savy enough to garner large discounts from list price. It's blind and not as good as a personal recommendation, but as a fall back...Most of the arlington folks here have owned for a long time (though I don't see why that would stop them from giving a recommendation if they had a good experience), and anielarke has never named her agent, so I think that's a well kept secret... Or you could be in luck, she might say.
To anyone who was trying to figure out the commute between Vienna and DC yesterday:I heard of commutes of 45-55 minutes driving. That depends where you live in Vienna and where you need to go in DC. Vienna has two metros (Vienna and Dunn Luring) so there is no need to drive to Ballston metro. Also if you can take 66 assuming you have two drivers or a hybrid, from the Town of Vienna it takes about 25-30 minutes to get to Federal Triangle.
For anyone following the $8k tax credit, this has to be considered "significant."The first time homebuyer tax credit may be extended, and even expanded, according to House Speaker Nancy Pelosi.The $8,000 credit is set to expire Dec. 1.“Yes, there is under consideration whether we extend the first time homeowners credit,” Pelosi said at a news conference Thursday. “And the question is, would that be just first time homeowners or would you open it up to other purchasers of homes.”
Jewel: My agent at Long & Foster in Arlington is Betsy Twigg (703-967-4391). I have been working with her for years, and she helped me buy several orange line corridor condos earlier this year. She is very nice and makes everything painless.
Regardless on which camp you are, those who want to see house prices go down further, or those who believe we are already recovering, the truth of the matter is that divide between the haves and have nots has expanded. That seems to be the trend for some time now (decades). Not a good one.
Robert,yup that qualifies as significant. Thanks! Any link? (not that I could find ones to give with mine...)
Pelosi Tax CreditHere's the other piece with Schumer (D) and Cornyn (R) agreeing on the tax credit.
Bloomberg story that includes Robert's info on the status of the $8k and many other mumblings by lawmakers.
"tiredbubblewatcher said... And on that note I'm off to enjoy the weekend. As I'm sure no one will disagree, I spend way too much time on this website and am going to make myself take about a month off. Here are my predictions (watch me go 0 for 3 on these):* $8k housebuyer credit is not extended* FOMC Meeting Nov 3-4 ends with Fed Funds rate staying 0-0.25%* DJIA breaks 10,000 some time during the month"TBW - Gone for a month?? I laughed out loud when I read this as I seriously doubted you could do it. In that regard, you are already 0 for 1 in the predictive department ;)
tbw,Everyone's gotta remain hopeful about something.No harm in being wrong, I'm wrong all the time, if this goes through it will be the first time I can remember making an accurate prediction on the blog. (well, other than that t's TH would sell for near asking, also, didn't take a genius)
Cara,Yeah, how has this blog done on interest rate predictions for the last six months? 0 for 50?
Robert,Hey I got my mom a 4.875 interest rate with no points back this spring just one week before they rose back above 5, so I get some credit for that.
Interesting read from the Connection about how both Gerry Connolly and Jim Moran are concerned about the government eliminating contractor jobs. Perhaps, Gerry is worried about his SAIC stock.Consultants hired by Fairfax County to track and lobby for federal legislation indicated that the congressmen are appropriately concerned, given the potential impact to Fairfax’s businesses and economy, which relies heavily on government contracting.Hmm, I could see how the County would be worried surely the business taxes are a greater source of revenue than Federal Impact Aid.Feds ‘In-Sourcing’ Could Hurt N. Va. Economy
Just another data point about short sales: While having two (or more) liens on a property does make it less likely to reach closing, it's not entirely impossible. The short sale I bought had two loans on it. Granted, thanks to reselling, they were both with BofA. So, yeah. Harder but not impossible.
Can you find any quotes where anyone said by October 2009 interest rates would be substantially up? If I said that I have egg on my face. However I think in the past I (and others) just said interest rates would go up in the future. The future does not mean the immediate future. It can mean over the next year or next two years.Nah, this is the future. Rates are down.
Jewell-If you are comfortable posting an email address, I'd be happy to send you an Arlington realtor rec and some un-recs.
jewelI would delete that last message if I were you. It should have reached Meshell in their email notices by now. There are definitely spam bots trolling around in here...
If they expand and extend the housing credit, I sure hope they apply some crieria besides income; like those yahoos that have a foreclosure or a SS NOT being eligble. You guys that think these people are harmed enough to keep them from buying must also think all the crooks and criminals are out of the financial system.
Va_Investor said...Yes, well, Cara it was you. up until you decided it was time to buy. I'd say "passive-agressive", but I won't....I will agree with VA Investor that Cara's overall tone has changed since they put in their offer. I think we all unconsciously try to find ways to justify ourselves though - buyers and bench sitters alike.
Jeremy,My tone has indeed changed. Both my tone and putting in an offer stem from the same reasoning. But yes, that reasoning does over time blur into a general feeling not just reason.The market and the economy have also all changed a lot over the past year.But indeed, this blog is made up of humans. Taking a step back and trying to introspectively look at whether you're arguing what you're arguing because it's what you want to be true or because it's actually what you think will be true is worthwhile to do periodically.But yes, as you have all read endlessly, we made our decision balancing our needs and our wants, and doing our best to calculate exactly how much we might lose if prices fell to cash-flow investor levels, and made our peace with that risk. And put in the offer, sticking to our guns on how much risk we're willing to take.People who are trying to buy a SFH, or a TH over the $400k mark have a much more difficult task to evaluate than we did. Ours is purely entry level, and would make a great rental, so it's easy to predict how low it could go and how much over that we're willing to pay to buy now rather than later. Anything that people are bringing cash to, or that trades at over rental parity, that's based on incomes and interest rates and willingness to put over 28% DTI towards, is a lot harder.It's an interesting definition of "the bottom", the chunk of time over which it's truly a personal decision whether now is the time to buy or not. Most places (not all) prices are low enough that almost everyone on here could chose to buy a SFH. Now it's more a matter of can you find what you want, what do you think the market is going to do, and how much do you care about buying at the absolute bottom versus getting a house now.
"I will agree with VA Investor that Cara's overall tone has changed since they put in their offer. I think we all unconsciously try to find ways to justify ourselves though - buyers and bench sitters alike."Isnt that just the normal progression of things? Bearish at first, then as prices fall, you become bullish vs. staying a bear forever? Supposedly, there will come a day when even contrarian thinks prices have fallen as much or close to as much as they will, and he will change his tune too. Think of it this way -- can you imagine anyone deciding to buy in spite of the fact they still believed that prices were going to fall much further? Any such person would need to get their head examined!!!
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