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.
Calculated Risk 2004 Fed transcript excerpt.Absolutely maddening. What gets me is that after a lucid description of how residential housing had all the earmarks of a bubble, the next words are from Alan Greenspan calling for a 20 min coffee break, after which time it is dropped from discussion. WTF? Did he think this was all academic and unimportant and was cutting off discussion by calling for a break, or did they all discuss it in small groups over coffee and it didn't get transcribed? Grrrrr.
A few months back, Washingtonian did a peak to trough comparison of prices the 100 most expensive zip codes in the DC area. As you would probably expect by now, the areas in and close to the city generally did better than those farther away. Nevertheless, its still interesting to see these areas plotted out on a map. The areas marked with a little green house are areas where prices went up, even by amounts as small as 0.1%. By contrast the areas with a red downward arrow lost -25% or more. http://switchboard.nrdc.org/blogs/kbenfield/dc_area_market_speaks_loud_and.htmlTo be sure, there are far flung areas that suffered less than -25%, and there are close in areas that saw losses (albeit under 25%). Still, its interesting to see a head to head comparison of the just the high end areas over the last 4 years.
Interesting chart, CRT. It's not just north Arlington that didn't decline during the period charted, but also McLean, some parts of Falls Church, Old Town and nearby Alexandria areas, "east Arlington" (22202) and other close-in areas near metros or 66. I'm a bit surprised about some of those areas.
It looks like we may see sub 5% mortgage rates again. I don;t know how many of you have been following the treasury market, but after rising to over 4% a month ago the 10 year treasury is back down to 3.6%. This is where rates were a year ago, so I would not be surprised if rates start to tick back under 5%. This may be mildly positive for the housing market, but probably not useful enough to make up for the loss of the 8k stimulus.
Maybe I'm misreading the map about some of those areas. On second glance it may be that some green houses I thought were west of the Potomac may be in the District.
Ace,It's a hard to read map, but the text says that the area you (and I) thought was McLean is Tyson's itself.hb,Since I personally think the low interest rates have been a much more important driving factor in maintaining sales at current prices than the $8k was (especially post-October), I'd say your observation is quite relevant.
Cara- I think my observation are relevant if rates stay low, fall below previous lows. I am not sure that the average person notices the differences between 0.25-0.5%. So unless the media picks up on this and makes a bunch of comments about rates I don't know how much of an impact this will be. If you add the thawing of the Jumbo market to lower overall rates it could be a big deal for the $1MM+ range.
it's way beyond my price range but i drove by this home a few times and thought it'd be a 1MM+ home, and was surprised to find it sold for *only* $921K.was it the radio wave tower that's responsible for the price?
All those green house symbols have not corrected yet, they are all going to crash 25% because of the substitution effect. LOL!
hb,Agreed, the thawing of the jumbo loan market and lower rates there is definitely going to be a bigger story in the coming months.But the longer rates stay near 5%, the longer current buyers who are house-hunting anyway will be able to continue to pay today's prices. I'm picturing more of a soft landing.
Doug,it's painful to admit, but it appears you get the last laugh. the good old days of dreaming of a 25% drop have long gone...
dougat the end of the day the issue is DTI, when that exceeds 33% it really becomes unstable.Inner areas have had increasing incomes, but nowhere near the price increases.As that interest rate rises, the DTI rises.
MM,I think it's partly the site. It looks like it was built in the back yard of someone's oversized lot, and has houses all around it.(Does anyone else have the problem I do with franklymls.com, that the map at the bottom always shows the wrong location?)
KeithK, I have the same problem.MM, KeithK may be right about why the house didn't go for more. It's a good size and in good condition. However, it may be that the original kitchen and bath cabs. are still there and they may be those fake-o type instead of painted wood. It's a 4/2 rather than a 5/3 or more. Harrison is a fairly busy street, and the houses around this one don't appear to be in the $1 mill. range, which tends to keep prices down. However, with all that said, I also would have guessed a higher price, like you.
Ace, KeithK,I think it's some cookie problem... sorry I can't remember how I fixed it... you could always email Frank or check his franklymls specific blog.MM, Ace,Well it did only take 9 days to sell and they accepted under list. It may have been priced to move.
http://www.washingtonpost.com/wp-dyn/content/article/2010/05/04/AR2010050402097.html?hpid=topnewsi don't think the deepwater horizon oil spill will crash the markets but,the PIGIS could easily.The european banks are in dutch overthe state of their lending, and they are all functionally bankrupt.
Ace saidTBW, I don't know whether the guv included the bonuses. I thought the wording was ambiguous. I agree with you that he might have wanted to impress but he may not know enough about private industry comp. to think about bonuses. Yes, you're right in assuming I didn't vote for him. cara saidRelated to what Ace is saying, I just don't know that you should take an offhand statement in a political speech as gospel truth. They fact-check people's speeches for a reason. High levels of accuracy are not to be expected.Just to be clear I don't think my believing Gov. McDonnell's $200k figure makes me a big fan of his or voted for him.I looked up his bio and he has a business undergrad degree from Notre Dame and an MBA from Boston University. Even if he lacked those one would home years in the General Assembly and Attorney General Office (let alone just a regular reader of newspapers etc) would make one familiar with bonus compensation. Also, the $200k figure was almost certainly generated by the state economic development staff and not him. That all being said it could be an incorrect figure. But I do think we should operate under the assumption it is correct until some credible fact checking source corrects it. Also, I will once again reiterate though that the motivation would be for McDonnell to overestimate this figure and not underestimate it.
Putting aside yesterday's political discussion, I think Va_Investor's main point was that if the BP spill led to higher gas prices then that could be a factor in favor of a double-dip recession. I agree with that. If gas zooms up to $4 that will be a very negative factor. Thankfully, so far, there appear to be minimal increases in the price of oil.And while I think people go overboard with the effect high gas prices has on exurban and suburban home demand, it can't possibly be a positive factor.
housebuyer,I wonder if the yields you are seeing are related to the Greek crisis. However, that does me little good because even if they started to go up if the market felt this bailout will work they will probably just go back down again as they start to worry about bailing out Spain, Portugal, and Ireland.
CRT,Interesting link. I hate how the author is conveniently leaving out that the eastern half of smart growth is not showing price increases since that puts some water on the idea the market just loves anything that is walkable and close-in. But in any event, I hope he is right because I want to eventually live in a suburban community. I hope the market continues to think those are not as good as walkable communities so I can get a better deal. Unfortunately, I have not seen any major market movement toward seeing Oakton, Vienna, Fairfax Station, Burke, etc as undesirable. Unfortunately, many still agree with me that one can make a nice lifestyle in those communities despite the requirement to have a car.
TBW, my understanding was that the guv was simply reporting figures that the company gave him. Cos. may or may not include bonuses when they report #s. He may not have asked, "is that total comp.?"
TBW- You are probably correct that it is correlated with Greece issue. Although its also probably related to Goldman and BP. Over the past couple of weeks, there has been a decent move out of riskier investments look for safety. So bonds, stocks... have not done well and treasuries have looked great. My guess is that none of these things end up being a huge deal. The markets have just moved a ton and now that a little fear is back in the markets a healthy pull back is reasonable. It is also another excuse for Big Ben to keep rates at zero.
I'm not sure why I find this seller remark obnoxious:http://franklymls.com/FX7314286"SELLER HAS FOUND HOME. WE ARE SERIOUS PRICE DROPPED $5000."(maybe it was the traffic this morning)But honestly $5000? That constitutes "serious"? With the number of updates/maintainence they've taken care of the price is actually pretty accurate for a list price, so I can't say I blame them for keeping it that high, but OTOH, those look like the original bathrooms, and they simply replaced the kitchen without increasing either the storage or work areas. Anyway their price is close to right, but if they think $5k is a big deal, that does not bode well for trying to negotiate with them. And negotiations should be warranted, because my house is the closest comp in update levels and would max this house out at another $10k lower than list, and that's generously (and erroneously) disregarding the bathrooms, or saying the deck compensates for both them and the smaller lot. (I'm giving them $10k for the replacement windows, which may or may not have cost that much to the previous owner).I wish them luck, because I want things in the neighborhood to sell. We'll see if this ~1% price drop and motivated sounding remarks section is enough to bring an acceptable offer. One would think it would garner some offer...
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