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Saturday, March 27, 2010
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34 comments:
Money Mag. is projecting a 10% decrease in home prices through Q1 2011, for DC proper:
Money Mag.
No. VA is not broken out specifically from the VA data. Money predicts a drop for Bethesda, though not as steep.
Oops, I should have said "slightly steeper" drop for Bethesda.
This weird house is for sale again, looks like maybe they are serious this time.
http://www.franklymls.com/FX7282818
awww, Leroy, it looks like a mushroom in an enchanted forest.
And here's an attempted explanation by architect Roger Lewis, as to why there aren't more modern houses being designed.
Modern houses
I feel I have a better explanation on the "modern houses" thing.
The simple answer as I see it is that the "traditional" home evolved over a very long period of time and represents the end result of a great deal of trial and error and refinement. Certainly things have changed, but broadly speaking a whole heck of a lot more has stayed the same.
In short traditional became traditional because it works well.
In my opinion many "modern" structures are little more than an architect trying to be non-conformist and make a name for him or herself. Often they end up creating expensive quirky houses with compromised functionality and a tendency to age very very poorly.
Where I live in Europe there is a mixture of old and new. A beautiful building from 100, 200, 300, or 400 years ago remains a beautiful building today. A concrete box from 1955 just looks like a dirty old eyesore.
I see "modern" buildings from the 50s, 60s, 70s, and 80s. They don't look cool anymore. Now they just look dated. If they were torn down nobody would miss them.
An interesting topic Ace, thanks. I agree with Leroy that tradional houses usually sell best because those designs have been optimized over time to represent the interests of the people who live in them.
Architects and builders tend to favor designs that maximize their own interests ("style innovation" and maximum profitability) while paying token lip service to representing the client's needs. This accounts for much of the buyers remorse affecting initial homeowners and the repugnance of later buyers when what was trendy at the time has dated badly.
A current reading favorite of mine is Sarah Susanka and her "Not So Big House". I'm sure that many of you are familiar with her but for those that aren't - she is an architect who was asked to fix client unhappiness with various homes. She noted the deep unhappiness of many in their large McMansions and designs homes on a much smaller and more intimate (though not less costly) scale. She made a study of what matters on a psychological scale to homeowners about their houses - what works and what doesn't. She has a series of books that make for interesting reading. I got my reading copies through the libary.
doesn't look like the buyer got any 'horder's neighbor' discount. N Arl's low-to-sub-600K market is seriously hopping right now. bad news for me, good news for..., i don't know, the economy?
MM-
Your query had 51 houses with 33 still being active. That really doesn't seem that hopping to me. Sure some of the houses are probably overpriced so the 33 number is a bit high, but I am sure some of those 18 under contract houses are short sales that have been under contract forever. In Fairfax <$600K there are 5172 houses with only 2077 active. So that market appears to be moving much faster. Even if you just look at detached it goes from 1938 to 805 so yet again Fairfax is much more hopping than Arlington
Leroy: That's a house? I thought it was a Fotomat!
Interesting, MM and HB. I wonder what the #s would look like in similar price ranges, e.g., $400-$600, or a narrower range. Fairfax has a LOT more properties less than $400K (than does Arl.) and these are really moving, many of which are SSs or foreclosures. I wonder if the $8K is continuing to have an impact.
Ace-
In the zips that MM listed there are 47 detacheds between 400-600K and 31 actives, which is 66%.
In fairfax thre are 1086 detached houses between 400-600K with 546 active, which is 50%. So you still end up with the same result that Fairfax is a much hotter market than Arlington. It is possible that Fairfax has a lot more short sales which stay under contract a lot longer so that could be making up some of the difference.
Ace,
Yes, Money magazine expects Bethesda to fall by 11.8 %.
I think they count Bethesda-Gaithersburg/Germantown areas as separate from the DC area for statistical collection purposes.
So when they say 11.8% for Bethesda, that may be more about the Gaithersburg/Germantown areas than Bethesda itself. In the same way when they predict 10% declie for DC, many desirable close-in areas won't see that decline.
I think until now Bethesda and Potomac haven't seen as significant a decline as the surrounding areas of MontCo.
If they do in fact mean just Bethesda, what is their rationale for such a prediction? Were their housing predictions in the past 5 years close to reality? I haven't checked.
c - Lots of homebuyers and architects are being influenced by folks like Susanka. I think it explains in part why a lot of new homes now targeted to affluent buyers are marketed as Craftsman-style, or bungalows, rather than Colonials (which are now associated with "McMansions").
But every now and again I see a new house like this that is marketed as an Arts/Crafts home, but to me is awful butt-ugly:
http://franklymls.com/FX7292958
I guess this house is nicer from the inside than a lot of McMansions, but what an eye-sore.
I agree with you Mozart.
But if people wouldn't buy McMansions, then builders wouldn't build so many of them. Oh, wait, I don't think so many are being built today...
In the long run, if housing prices continue to drop substantially, gas prices rise significantly and more people with less money want to move closer in, I suspect that some of today's McMansions will be rehabbed into apartments and sublets. This has been the fate of many old mansions in Europe.
Mozart: wow! That is an architectural abomination. I like how they couldn't be bothered to add steps to the back door. Also, I seriously dislike those pop-outs in the rear that do not reach the foundation. Those remind me of cheap townhouses built in Loudoun.
Based on the price history, they've been asking roughly the same price since 2008 with no buyers.
HB, c, tedk, thanks. Very interesting.
Mozart, NoVAwatcher,
That listing is "stunning", all right, but not in the way the agent intended.
Any advice out there on how to rent a home? We are pretty private people and are hoping to get into a home where the landlord is not all up in our business. Plus some of the applications are draconian (bank account numbers and credit card numbers, three personal and work references EACH, will my blood type be next...)
We had one place where the owner decided to sell so we had a lockbox on our front door and the owner and realtors in there day and night. Was one of the worst experiences I have ever had and I will never repeat that.
Any advice on how to get into a place to rent where we get to live our lives in peace?
We went to an open house today that was under-priced for the neighborhood. It isn't a short sale, but is sold "as is." Apparently the owners tore down the old deck and built a monster two story deck on the back of the house without ever getting permits, inspections, or even HOA approval. Who does that?
The agent tried to tell us you just need to get the inspector out there to "look at the footers" - but I know they wouldn't have discounted it that much and would have just had it done if that were the case. I'm guessing at least a backhoe and the whole back yard torn up - but more likely the whole deck would have to come down and be rebuilt to code. They're also trying to close in under 60 days, I'm guessing to rush the future unlucky buyer so they don't reconsider.
Here is the house if anyone is interested - we decided to pass.
http://www.redfin.com/VA/Oakton/10854-Parcel-Ct-22124/home/9441328
Beer Chugger, maybe VA_investor will chime in or others will have better inputs than I do but here are a few to start:
1) I think it may be pretty common these days for landlords to ask for a lot of financial info, because it takes time to evict people who don't pay rent. Some people may be in a negative cash flow situation but can't afford to take a loss on a sale now and would really be in trouble if the tenant fails to pay rent, so they may be taking what may seem like intrusive steps to protect themselves. So you may face this anywhere. Or maybe you can negotiate -- maybe they would agree to run a credit check (if you give them your SSN) but not ask for bank numbers, etc.
2) Write into the lease contract with the landlord that the house will NOT be placed on the market for sale during your tenancy. Or, indicate what compensation you want to be paid, to move out, if they decide to put it on the market during your lease duration. If you agree to let them market it while staying there, the lease should say that there will NOT be a lock box and you must be given at least 24 hours' notice.
3) maybe you should consider renting in a complex rather than a single family home.
beer-
If you want to live you life you may want to try and find a company that is doing the renting. Some of the major apartment companies also have some town houses and maybe detached houses. Although I am not sure about that last part.
Otherwise I would just use craigs list and be up front with the landlords, they tend to be fairly honest from my experiences at least.
Jeremy, FWIW, I saw an HGTV show about a woman whose friends were partying with her on a 2nd story deck when it collapsed due to (not approved) poor construction. Serious injuries ensued. Many tens of thousands of $ later, with lawsuits still pending, she was having the deck rebuilt by a legitimate contractor.
Jeremy,
http://www.hgtv.com/holmes-on-homes/hit-the-deck/index.html
Jeremy: I saw that place earlier. It's, um, interesting (I'm undecided).
You're story explains why they dropped the price by $300k. Personally, given the house and the neighborhood, I don't think it's underpriced (most are nicer in the neighborhood).
Beer,
You're asking an awful lot. Are you running a meth lab or something? You want the keys to something very valuable and don't want to prove you have any source of income or assets or financial responsibility?
You can ask about plans to sell and request no showings during your occupancy, but I doubt you'll get that. I tell prospective tenants that I have no plans to sell and that is the truth, but I won't strike that clause in the lease. What if I get hit by a bus before your tenancy ends?
LL's don't like downtime and want to show the place to new tenants as soon as a current tenant gives notice.
You want a longtime, longterm landlord. No apartment complex is going to lease to you without all your info. If you want a house or townhouse, look for someone like me. I have flexibility and have had some tenants stay more than 10yrs.
I've been getting many inquiries from people whose LL has been foreclosed on, so you have very legitimate concerns in renting from an individual. You can always ask the LL for references. It's always surprised me that no one has ever asked me.
I talked to someone the other day who went all last summer with no AC. The LL wouldn't get it fixed. You don't want someone like that. But, on the other hand, I wouldn't take a tenant who started complaining about even filling out an application.
VA-
I have never needed to ask for references, because I have always been shown the house from the current tenants who will answer your questions pretty honestly.
I can't believe the tenant continued paying rent if they were not given AC during the summer. I would have given them a couple of weeks, but after that I would either break the lease or just stop paying. There is zero chance I would be paying full rent if they wouldn't fix the AC.
Finally, I am pretty sure several laws were recently passed protecting renters if their landlord goes into foreclosure so I am not sure its a big problem anymore.
Jeremy - Good decision to pass, in my opinion. Even though there are some other more contemporary houses in Berryland Farm, that house looks out of character with the rest of what's sold in recent years in that neighborhood.
housebuyer,
Yes, there is legislation. I don't know all the ins and outs, but tenants leases are protected. Most tenants do not know this. They panic and leave.
I don't think I would want to move into a place and find out a month later that my new LL is Bank of America or that I can't settle in for a few years if I wanted to.
While my tenants are present often, I have rarely had them show a place for me. Whatever...
i don't know if that was a former FotoMat, but it sure looks like a recycled community bank headquarters.
NoVAwatcher said...
You're story explains why they dropped the price by $300k. Personally, given the house and the neighborhood, I don't think it's underpriced (most are nicer in the neighborhood).
I guess what I should have said was a home at a lower price for that neighborhood. We like Berryland Farm, but most of the houses are out of our reach. The other one for sale right now needs a lot of work inside and they want $830k. Somehow they made it look good for the pictues, but we went to that open house and every floor in the place needed replacing badly due to stains or warped/missing sections.
There is one model of contemporary prevalent in Berryland we like a lot, and of course we like all the tudors but they would be out of our range (too big). We met an agent at an open house in Miller Heights today and she had a couple of promising homes coming on the market in our target neighborhoods in the next couple of weeks. Worst case this year is a dry run for next Spring, but at least we're seeing some homes we like at prices we can stomach these days. I'm happy to let this year's buyers do the price discovery though if it comes down to it.
Jeremy-
I would not be surprised if eventually the second one becomes a short sale. They bought it at the peak of the bubble and are not trying to take much of a loss. Likely people will not pay this price so they will either have to stay there or lower the price. I know assessments are not that accurate, but it is assessed at 630K, which is down ~25% from peak, which is probably pretty accurate.
VA-
I guess a fair number of the landlords were also there during the showing, but as long as the current tenants are there I am always fine asking them questions. I am sure that you are right that most tenants do not realize that they can stay even if the house is foreclosed. If I didn't realize this I would have absolutely been looking for a land lord with your stability. My current landlord is ~30% underwater. I keep on expecting to come home to a foreclosure notice, it hasn't happened yet, but that doesn't mean it will not in the near future.
Jeremy: Clarkes Landing (I think that's the name) is across the street a turn or two down Vale. I almost bought a house there last fall, but the roof and deck gave me the willies. Anyway, nice houses pop-up there every so often.
Alternatively, if you go down Vale past the stop sign, houses can be just as nice but a little bit cheaper.
http://franklymls.com/FX6894157
Here are some recent Berryland sales. The first one is smaller than it looks and needed more work than the pictures suggested. My wife wanted to look at the second one, but the house backed up to Vale, so I nixed the idea:
http://franklymls.com/FX6853925
http://franklymls.com/FX7157767
I agree that Miller Heights is a very nice area, and was the area that we originally targeted. A lot of the houses there are only so-so.
Leroy,
Let's see you just equated modern architecture with all bad architecture and then said people don't like it.
Hmmm. Seems like there's a logical fallacy in there somewhere.
Not all modern architecture is bad. And those that are good stand the test of both time and the market. Like Hollin Hills, or Frank Lloyd Wright.
You're right, a lot of it is bad. And as a buyer you're running that risk of it being a vanity project or just a poor idea. This is why I'd say, most newly constructed modern style homes are going to be for those who can afford to take a risk. Not accessible to the everyman like McMansions have been. It's sad that everyman homes in a modern style like Hollin Hills didn't get more widely built, but I think they might have lost their cachet and charm had they been less rare.
Mozart,
OMG. What element of craftsman are they thinking is buried under there somewhere that they chose that label? That house is a monstrosity from the outside anyway.
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