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.
Cara's 10 day early predictions for March FFX county stats.There were only 1100-some contracts in February so solds are bound to be down from last year's 1040. Last year's median price of $320k will be easily exceeded though. And days on market should be down again from last years 92. So I'm guessing the median will be up both MoM and YoY, sales will be up MoM, but down YoY. Here's the thing with DOM. Has anyone else noticed more "coming soon" signs this year than last? Am I just now noticing what has been common practice for a long time? In addition to agent's dropping the list price to the close price before marking it under contract, I think this is another tactic designed to make agent's look better. Because I've seen some townhouses "coming soon" for months, that are then under contract within a week or two. You could call this a great sales tactic, generate interest and multiple buyers without the hassle of actually being marketed, or you could call it distortionary, but I'm guessing we might be seeing more and more of it as seller's test the waters.
cara,I've heard lots of "murmurs" of things "coming up". Can't recall about the last frenzy as I wasn't following very closely. I know for my recent (maybe) sale, the LA was being hounded by people in his office about when it would come on.p.s. new listing (exact comp) to my under-appraised sale came on yesterday at more than 20% over the low-ball appraisal and well over my contract price. I know it needs to close to count, just sayin' some of these guys are running scared on the appraisals and seller's like me aren't standing for it.
Va_investor,Hmm, that's a different take on it. I would have though needing to pre-advertise in order to keep DOM low would be a sign of weakness or tentativeness in the market not the start of a new frenzy.... But I think it's two different but related things were seeing. You're seeing interest being shown by buyers who are scrambling to find out about listings the LA's may have in the pipeline. I'm seeing obvious pipeline propeties needing to be displayed for months before the owner and LA are confident enough to actually list it on the MLS. Kind of the opposite phenomenon. But, one could see how one could beget the other. If DOM are held artificially low by cautious LA's and owners, then if there are actually a lot of buyers out there then buyers will need to seek out pre-listed properties otherwise they'll never get a shot at them.
"I feel like I should be able to report this to someone but I would guess they are still not violating the law even after TARP and the million other programs designed to clean up the mess these 100% loans created."You know, on the radio this morning there was an over 5 minutes commercial for 5-year ARMs. The person was talking about how great they are and you should get one if you are going to stay less than 5 years. Wasn't that part of the problem too???
Oh, and I have also been seeing a bunch of "coming soon" signs as well.
sehrwunderbar,Thanks, it's good to know it's not just me. As for your and tbw's observation on the marketing of questionable loan products... While the constant barage of TV ads in the 2002-2006 timeframe for refinancing your house definitely spoke ill about the state of lending... I'm not sure a few fliers and radio ads say the same thing.There will be fraud and manipulation both on the way up and on the way down, it'll just take different routes.But adding to the annecdotes:On CR's blog I got a banner for ING Direct selling ARMs of unstated length at 3.77% APR. You have got to admit, that does sound really really tempting. Depending on terms and how you chose to pay it off it could be worth it even if you stay a bit longer than 5 years. (It'll take a few yearly increases to get up to the current 5% and even after that you've saved so much by having a lower one for X years, that it could still make sense, in fact if you put that all towards principal repayment your interest costs could remain under that for a fixed rate mortgage for quite some time.)
Cara & Wunderbar- I still don't know what I am planning on buying, but if I am able to get a good deal at the courthouse on one of the condos in my building I will definitely use an ARM. I would only want to live there ~5 years, plus I would almost surely have enough money to pay off the house in full in 5 years in case interest rates went up. Realistically I will probably have enough money in 2-3 years to buy the condo in full... If I decide to buy a larger SFH I will use a 30 year fixed, since I am planning on staying there longer.
It is different in Texas...http://www.thebigmoney.com/articles/judgments/2010/03/30/lone-star-secret
This is a good deal:http://franklymls.com/FX7295648
It's no different here. Nothing special. Move along.washington.bizjournals.com/washington/morning_call/2010/04/dc-area_home_prices_strongest_in_nation.html?surround=lfn
Robert- I think everyone here knows that DC has the highest CS value. I think that is exactly why some people think we will do worse in the future. I do think most of it is because fundamentals are better here than most of the country, but I would not be surprised at all to see the Washington CD number to fall another 10 points and then stagnate before rising again.
...and for the thousandth time... pretty much everyone here agrees that the DC area has a strong economy with good future prospects, but that isn't the same thing as saying that real estate prices will do anything in particular in the short term.
1) The DC area also was among the strongest economies in 2006. We know what's happened to housing prices since then.2) On the list Robert cited, LA is 2nd. My friends in LA tell me things are still dropping in most areas.
Ace- I am pretty sure that they are using the CS numbers. If this is the case LA was up 0.9% in the last report while DC was down 0.4%. Your friend is likely looking at a price range is underperforming the market.Robert it will only take 2 more months like last month to have LA tied with DC for the best market since 2000
Cara & VA_Investor:For those of us having trouble understanding your in code speak, can you provide an insider's to English translation about what you two were talking about?I'm either offended, insulted, outraged, or envious.But I can't tell which by your cryptic comments.
Texas Native,Ever walked/drove by a realtor sign, only to be unable to find it in the MLS? That's what I mean. These often have "coming soon" in the place "under contract" or "sold". "DOM" is just days on market. I'll leave Va_investor to explain what the murmurs she's hearing mean exactly.
housebuyer,do you live in 1021 clarendon? there's one trustees sale unit happening soon.
contrarian,Did you miss when we discussed this WaPo article when it came out?Did you also miss that the government is considering offering banks 10-30% free money for simply writing the principal down closer to 100% LTV. Given that in a foreclosure the bank will at most recover 70% of current LTV, what makes you think banks won't do everything in their power to wait for that free money? Free money on losses that already exist but just haven't been realized. There's 11 months of inventory out there, but it starting to hit soon (any faster than it is now) still seems a dream.It is indeed all about the bank's insolvency from losses in the worst markets. Which is exactly why there won't be any increase in foreclosures if the government can keep propping the banks up.Yes, this is just like assuming the initial REO's would never happen due to continual refinancing, but instead of individuals it's banks. But banks are not individuals, so I'm not sure the same conclusion, of must fail sometime is true. If they do start failing, after the fact it will be obvious that it was inevitable. I'm not sure it's obvious now.
MM- No I live on Prosperity by the Dunn Loring metro. There are a couple of foreclosures in my building, but they keep on being delayed at the courthouse.
Texas,Murmur = whisper, rumor, talk of...etc. What my agent told me was the truth. Agents are asking other agents what they have coming up that may be of interest to their buyers. They want a heads up and even a peak ahead of official listing.
On the assumption Contrarian will soon delete this like all his other posts, I am saving this for posterity. For the record, Cara's comment @ 3:56 PM was in response to this post:"contrarian said...There is significant "shadow inventory" out there, even in the D.C. area:The Washington area has a "shadow inventory" of about 67,000 properties that could go into foreclosure this year, an 11-month supply at the current sales rates, according to research by John Burns Real Estate Consulting in Irvine, Calif.As Diana Olick, MSNBC, says, due to the first wave down in housing prices most banks are insolvent:The problem is prices. Home prices have fallen so far in the hardest hit areas, the areas where the bulk of the troubled loans are, that banks would have to write down principal 30 to 50 percent to put borrowers back in the green. Accounting rules require that banks write down the value of those loans on their books, and experts tell me that if banks really accounted for all the losses in the home loan market, they'd all be insolvent.This "shadow inventory" will soon come back onto the market, lowering the value of other homes, and ultimately the value of banks holding the mortgages.When the next tsunami of foreclosures begins (in the next few months, along with a collapse in the stock market), it would not surprise me to see bank holidays (closures) lasting for long periods of time.4/1/10 3:42 PM"
Contrarian deleted his posts? Thanks for pointing that out...every other day for the last three months.
"housebuyer said...Ace-I am pretty sure that they are using the CS numbers. If this is the case LA was up 0.9% in the last report while DC was down 0.4%. Your friend is likely looking at a price range is underperforming the market."Correct, it looks like that article is merely looking at this (last) chart that we all know. http://www.recharts.com/cme.htmlBy mid-bubble, we were #4 or #5 thanks to others moving higher than us - during the bursting however, we moved up to #1 by default as the other high fliers crashed harder than we did.As HB noted, LA and NY are definitely within range of taking over the #1 mantle from us. My guess is LA.
"Robert said...Contrarian deleted his posts? Thanks for pointing that out...every other day for the last three months."No problem. You have no idea how petty I can be when it comes to idots who refuse to admit they were wrong (or in this case delete all their failed predictions :)
Leroy said... ...and for the thousandth time... pretty much everyone here agrees that the DC area has a strong economy with good future prospectsDon't bother. Robert will remind us on a monthly basis that which none of us disagree with whether we tell him that or not. He looks through the prism at the only angle he understands, jobs. Not that it would explain for him how housing prices can fall 30% with unemployment not changing at all, but I shouldn't challenge him beyond his own capacity.Or as Ace said....The DC area also was among the strongest economies in 2006. We know what's happened to housing prices since then.
contrarian said...Robert said...Contrarian deleted his posts?Robert, The question is: Why? No one seems to have any clue WHY I did it. How about you?"Contrarian, we all KNOW why you did it. Dont you remember, you told us yourself:"Contrarian said...Being a longstanding, and generally miserable failure at predicting anything via the elliot wave, I am now going to delete all my posts. This way, no-one will ever have proof that I said any of the oh so wrong things I said over the years about Dow 400, real estate dropping 90%, Hal Turner being a credible source, etc, etc, etc. As this crisis is clearly wrapping up now, I will now go underground to my permabear den and hibernate for another 10-20 years waiting for another crisis to emerge. At that time, I will re emerge and impress another new group of bloggers how bad its gonna be (til they too realize what a fraud I am and then I will delete those posts too).I will leave this post up for 20 minutes, but then I will delete it. Oh, and if any of you bring this up, say like in early April 2010, I will deny it and say its not what I said at the time, call you a liar, or I will just go silent and not even adress the fact that you caught me in my desperate attempt to ever be proven wrong. SEE YA!!!10/21/09 2:21 AM" http://novabubblefallout.blogspot.com/2009/10/northern-virginia-bits-bucket-10202009.html
contrarian said...The question is: Why? No one seems to have any clue WHY I did it. How about you?Pretty sure it's because no one cares. No post history = no credibility - especially when everything you post is so far off the wall from everyone else. Maybe you should sign up with a new name to see how many people believe you when you troll...
Kevin,There was a housing bubble in Northern Virginia. The primary culprit was easy credit, but there were bubble jobs in construction and real estate that pushed prices higher.The bubble has corrected in most areas. The reason NOVA retained more bubble gains than elsewhere is because of jobs. So, guilty of focusing on the jobs picture.We all know of your brilliant insight in sitting out the housing bubble, but your utter inability to forecast government intervention is surprising.Let's see...we have a major recession initiated by housing price declines and the USG will...Most third graders could finish that sentence.
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