Please post your local house search updates, MLS finds, on-topic ideas, and links here.
(But if I were you, I'd be outside enjoying this divinely beautiful weekend).
Saturday, April 3, 2010
Northern Virginia Weekend Bits Bucket 4/3-4/4, 2010
Posted by Harriet at 11:44 AM
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43 comments:
http://www.bubbleinfo.com/2010/04/03/stealth-bailout/
yet another bailout for banksters
cheryl says:
"I am at less than 50% of peak for a completely renov. unit (end unit backing to green space and the w &od path)."
that seems like a rational price point to me. I think the damaged units should be at 66% off peak but, if the place has had some serious work, it should be fine.
Thanks Pat,
I tend to sell under. I believe in win-win. It offends me when I'm portrayed as a dishonest.
Cheryl
I still find myself dealing with people who think that post peak pricing should be 15% down.
now heavily damaged units, should be down 75%. units needing work should be down 66% and clean, move in should be down 50%.
now if the Fed would stop pumping money into the banks, i suspect the true market price would be lower.
there are sort of resistance floors to markets
1) cost of construction. Damaged sinking markets where people are moving out will trade below construction costs. People still build new, but there are lots of empty tolerable units hanging out for under construction costs.
2) Rental Income. Assuming people are still not leaving the area, then, properties will always sell for some Cap rate, wether it's 3,6,9,12%. people were accepting 0% cap rate but in edgy transition hoods, i see 12%.
3) Rent v Buy. There people are accepting 3% but that's stable or growing areas. people are discounting their rent, and wanting the emotional comfort of ownership
Va_Investor,
I thought you got multiple bids? If this person with the low appraisal cannot close aren't you allowed to move on to another buyer?
pat,
Your links never work. It's weird they are highlighted the right color but no link.
New program will help homeowners facing foreclosure with short sales
Interesting chart. Clear trend upward in terms of percentage of DC area sales that are short sales.
tbw,
SIX OFFERS. Would you want to be or take a back-up? Prices are extremely fluid. I'm not finding any lender/seller willing to take a back-up. I threw out all the FHA offers and went with the highest 20% down conventional. Not really wanting to give you any news (since you are such a sweet guy) an FHA appraisal is HARD for 3 mos., no ifs, and or buts.
TBW said
Pat
Your links never work. It's weird they are highlighted the right color but no link.
I keep having this trouble too. Someone helpfully posted instructions for this a couple of months ago. I followed those instructions to the letter but still couldn't get the links to work right. I even googled html tags on blogs and tried that. Couldn't get it to work either.
Harriet - Assuming you look over comments regularly, it would be sooo helpful if you would permanently post a small How To Create A Link That Actually Works text tidbit on your main page.
dont know why my links don't work.
maybe it's in the spacing?
but from the WP article
"Short sales already make up a growing part of the market, according to First American CoreLogic. They were 8 percent of home sales in January, compared with 5 percent in January 2009, according to the research firm. In the Washington region, they grew to about 15 percent of the market in January, compared with 10 percent in January 2009. "
DC has twice as many short sales as the national average, and people berate me for saying the prices will fall further?
that short sale stat tells me lots of people are dumping on deals.
hey for those who were interested, I had bid a property on north capital, and the offeror refused my backup offer.
word is the deal may go to foreclosure, sticky terms from the bank.
so i may wait until it NOT's and then bid it again.
pat,
I have something to say about shorts falling out and the re-list price, but I think I'll let those more on the ground floor comment. What the hell do I know?
To make a link, try this:
http://www.quackit.com/html/codes/html_link_code.cfm
Pat, different ranges and neighborhoods went up during the bubble at much higher/lower rates than did others, so I would say the % of peak that makes sense now depends on how much the house went up during the bubble.
Ace-
I completely agree. I am sure that VA is correct that she is fairly pricing her low end loudoun property at 50% off peak. These properties went up a ton and crashed to this range. On the other hand move up houses in the areas I am looking only went up 100% at peak so if they crashed 50% that would mean the price didn't move at all for a decade. I think most of us agree that it should move with inflation/wage growth so it should be up 25%-50% over this time frame so they would only need to fall ~25%-30% to be fairly valued.
pat said...
Pat's Geithner Link.
hb,
Lets leave it to Kevin. He knows nothing of the area, has not viewed the comps or the appraisal Expert opinion..
HB said - "On the other hand move up houses in the areas I am looking only went up 100% at peak so if they crashed 50% that would mean the price didn't move at all for a decade."
Any examples with actual sales??
IMHO..I don't see anything in this region anywhere close to being fairly valued. This is not to say I know all regions - so would love to see some real examples that agrees with your theory.
For once I agree with one of these housing market interventions.
I doubt the increased financial incentives will make much difference in the DC area because of how high prices are, but a streamlined process where a borrower is able to negotiate a price with the bank before listing and is able to get on with their life after the sale without a huge amount of debt hanging over their head would be best for everyone.
Spider-
Part of the reason I haven't bought is I have no found many properties I think are fairly valued. My comment wasn't that this area is fairly valued, just that if it fell 50% from peak it would be undervalued. The problem is that I think most things should sell for ~25-30% off peak at the bottom and right now they are only selling for ~15% off peak.
That is due to the lack of distress, but if you make it out to Loudoun, PWC, Manassass ... things already bottomed. I could be wrong, but we will just have to wait and see.
PS I agree with Harriet's comment that everyone should spent time outside this weekend. I got a little too much sun yesterday, but it was such a beautiful day.
Link instructions posted back in December. Should work.
spider, this doesn't show individual sales you requested, and you may have already seen it, but if not, see the first graph here:
CS trends for DC area--high, mid, low tiers
Ace,
The large drops are very localized, with the ocassional exception. In late 2008 and early 2009, I was paying 60 or 70% off peak in some circumstances.
Clearly this pricing did not occur in the wealthier areas due to (my Theory) move-up equity, other assets to tide people over and few incentives to sell the family home.
One can look to many lower-end areas to verify 50%+ discounts from peak. I won't comment if peak was justified or not. As I've said, neophytes were sold down the road and also jumped on the chance to own. They are back to renting as they should have been all along.
Developments where prices are about 50% off are Rolling Ridge and Providence Village and Chatham Green and on and on in Loudoun. A nice complex across the street from RTC (Parc Reston) is an example of real quality that was half off. Other condo's, TH's and sfh in Reston and Herndon were at least 50% off.
I know many here aren't interested in these areas; but the fact remains that proof is readily available. Some are stll out there but many flips have ocurred.
VA_investor, I think the CS charts are adding to your explanation, by showing that the higher end properties (and I don't know how they define those) never went up in percentage terms as much as did the lower end properties, so they don't have nearly as much room to fall without losing real value relative to the starting year. In other words, you're seeing big drops as good deals but a house in an area that didn't get artificially inflated as much in the first place could be just as good a deal--or better--with a smaller % drop from peak. If house A went from $100K to $300K and now has dropped by to $150K, it's not necessarily a better a deal than house B, which went from $300K to $500K, and now has dropped to $400K--particularly if in the intervening years House B was better improved than House A.
My own house/neighborhood (comprised of SFHs), which could be in the mid tier or high tier depending on how CS defined it, certainly did not rise anywhere close to 300%. The land values for some other neighborhoods (as assessed by Arlington) have gone up by close to that in some cases, but this may also reflect a changed way of assessing value during this time (to attribute more of the increase to the land than to the home).
And as for Harriet's good advice, I heeded it and overdid it yesterday too, and need to sit still before doing more yard work later! It's another spectacular day. I wish there were a lot of houses open but due to the holiday, there aren't.
Va_Investor said...
hb,
Lets leave it to Kevin. He knows nothing of the area, has not viewed the comps or the appraisal Expert opinion..
VA_I, I am sorry you are having difficulty selling your place. I know the frustration having been there. But if I could do it at 28 years old "knowing nothing" as you put it, then why is such an experienced RE pro such as yourself acting like a whiny little child? Like the stereotypical narcissistic baby boomer, you need to grow up and stop blaming the world for interfering with your profits.
Looking for a 1/1 or 2/2 garden apartment or cottage near Herndon, Dulles, Chantilly. Minimal yard responsibilities preferred.
This is for an older person. He drives and gets around fine but looking ahead, handicapped access is a consideration.
Prefer to pay cash so there is a price ceiling.
Any recommendations or cautions on communities, neighborhoods? No school age children so schools don't matter.
Ace-
Every month they break up the tiers so each tier is one third of the houses in that local market (aka DC has different tiers than Boston...). Right now the the cut offs are low tier is anything under 285K middle is 285K-436K and the upper tier is 436K+. Seeing that the upper tier starts at 436K always surprises me. It reminds me that there is cheaper housing than what most of us are looking at, its just not as close in as we would like.
I deleted something I thought a little immature. No need to stoop to the level of someone else.
I'm doing the intelligent, reasonable and experienced thing of re-listing with very high comps available. I'll make thousands more. Apologies to the person here who will be pissed over a FMV sale.
HB, thanks for that info. You're right, I would not have guessed those numbers would represent the thirds. Interesting.
Dumb Question (what else is new?).
If I allow follow-up comments to come to my personal e-mail, am I exposing my e-mail to everyone?
I think I can help TAG out but don't want attacks from certain others.
cheryl
the delete key is your friend.
However if you publish an open email
spammers will pick it up.
I'd reccomend you publish it as
"CherylXYZ (AT) AOL.c0m"
so a spambot can't read it but a human can.
as for annoying comments, well, just hit Delete.
Interesting article about Texas mostly avoiding the real estate crash.
I had thought it mostly avoided the crash because it avoided the boom (as well as relatively low unemployment avoiding the Detroit no gain but bust fate.)
Apparently there is another factor -- very strict rules on home equity loans (including 80 LTV max). Apparently those were not even allowed in Texas until 1998.
i was in Oklahoma during the bubble, i figured texas was sharing Oklahomas market conditions, that there were so many surplus dwelling units from the oil bubble that you couldn't get a bubble rolling until you exhausted the supply.
OKC didn't bubble much, the rise was much closer to interest rate changes then anything else.
Va_Investor said...
I think I can help TAG out but don't want attacks from certain others.
Who do you think is going to attack you? You start off ranting like a lunatic about me even though I never said anything. I ask how you were pricing compared to assessment $, and since then you've gone apeshit. You've pretty much snapped at everybody that dares even respond to you, and now you're worried that you're going to be attacked? Don't flatter yourself.
I have no idea why you think anybody has it in for you other than because you are batshit insane. Chill TFO.
We have time to research the area.
This is a separation prior to divorce. There aren't enough assets to buy more house, nor is there much income, SS, smallish returns from Income Funds. Prefer not to rent.
His daughter is willing to pitch in cash from her retirement savings if she is on the title as a joint tenant with rights of survivorship. There should be enough cash to buy a small place outright.
The Dulles-Herndon area is near her home, which is not large enough to fit another adult comfortably. It's her, husband, and two teens.
He gets around just fine and would be happier in his own modest place.
We'd like pointers on the general area to start. "Don't buy here, gang activity". "This area is up and coming."
Tag, as for the pointers you mentioned in your last pgh., have you checked out this site:
http://www.city-data.com/forum/northern-virginia/
Someone here directed me to that site a long time ago, and it can be really helpful.
Blogger tag said...
We have time to research the area.
We'd like pointers on the general area to start. "Don't buy here, gang activity". "This area is up and coming."
For starters, a lot of posters here are professional Real Estate Agents and asking them to *tell* you exactly, precisely, what you need to know is akin to asking the Knights Templar to reveal the location of the Holy Grail.
In short, you're likely to be rewarded with silence.
If you want to find out the bad places to live as defined by your own standards, you need to get out and drive the neighborhoods you want to live in. On every day of the week, weekends too. Shop at the local market. These are your neighbors. Stop in at the local businesses, this is where you will likely do business also. Stop in at the local police department and ask to speak to someone knowledgeable about the local crime statistics.
Use freely available web resources like the Census data. Use City-Data Zip Code Analysis, by far the best method to zero in on places that meet your own personal criteria.
Reston Zip Codes:
20190
20191
20192
20193
20194
20195
20196
Read all the data available on the page. There is some great info on each page to help you determine criteria.
You can also search by City name:
... for Reston:
Reston
And here is an example of a place I would not live even if buried there for free:
20164
City-Data.com has some great discussion forums where folks will tell you what you need to know about a particular zip code.
What we did when we wanted to live in a neighborhood was to drive it as much as possible, and walk it as much as possible (especially on pretty weekends with nice weather) to see who lived there. We made our own judgments based on our own personal criteria.
Always, always, verify anything an agent tells you about neighborhood, home values, trends, etc...etc...etc...
Again, the absolute best way to find out about a neighborhood is to spend some time there and see its residents.
Tag,
I don't know what you mean by "modest" interms of pricing. There are some condo's in North Reston that can be purchased in the low 100's. The area is full of beautiful walking trails, etc.
The upside can be pretty good as they are very close to the upcoming Silver Line. The bus is 2 blocks away. I'm willing to name several potential developments if you can give me a better idea of price range, space and amenity requirements.
Kevin,
Peace out,
calcrisk
virginia is in the top 8 for negative equity, a lot of that is richmond and the tidewater, but there is still plenty in DC.
All that negative equity will contribute to pricing pressure
TN, Ace, I'll be reading the sites and will pass the info to his daughter.
Even though she lives in the area, she bought 20 years ago and does not know neighborhoods beyond a mile from her home.
Any place in the broad swath from I66 across to miles west of Herndon should be OK. He has not worked in 5 years and won't be commuting.
Thanks.
Tag,
I know actual price is kind of a sensitive matter, but I would trust VA_investor to point out some good starting points if you gave her enough to work with.
Better to get them from her, to get your feet wet (/the daughter's) than to start from a RE agent that might not have earned your trust. Then you can bring at least a little more local knowledge with you when you/she starts with an agent.
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