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.
N Arl TH sold $50K less than '06; $150K more than '03
darn it, forgot why i didn't see this house - $130K(80%) off tax value
Cheryl Says"I tend to take a very simplistic approach. I look at my cash in, not the price/rent numbers. I look at ROI and also look (as best I can) to future appreciation based on events that I expect to occur.If I am break-even or positive from day one on a property I believe is undermarket and has a good potential to beat the market on the upside down the road, I will go for it.As long as it pays for itself"OkayHere's how i look at assume 20% down, calculate a mortgage, and then take a rent estimate, with a 10% vacancy rate, and 2.5% for maintenance (assuming normal condition), add in Tax and Insurance, usually 2-3%.at that point, I can calculate a Debt Service Coverage Ratio, a Yield and Cap Rate. If the numbers look good, then i can look further.I don't want to be a Slum Lord, I mean Rent baron, I don't want to spend half my life commuting to rental properties. So while there were some amazing deals in Woodbridge in 08, and trust me a townhouse in hoodbridge for 80K, was a deal, i didn't see myself fighting down 95 to deal with plumbers, HVAC guys and tenants.I am looking for a fairly unusual thing, which is a duplex or triplex that cash flows in Arlington, Alexandria or DC. I don't see a lot of those.I'm willing to be patient because m rent is cheap.You know what's driving me to buy?I'd like a place where I can put in Solar HWH and PV Arrays. Can't do that if the place is a rental.Our place in Oklahoma we had put in Rain Barrels, tankless Hot Water, 95% efficiency furnaces and Low-E glass windows.Doing things like that takes time and money.it also leans you towards dumpy places where the interiors are a little busted up.So it's why I like the somewhat dumpy places because I'm going to be looking at doing Grey Water, Solar HWH, PV.
MM - 130K would be about 20% off tax value - maybe you meant it sold for 80% of tax value? That house needs a LOT of expensive work (installing A/C alone (given duct work and electrical upgrades likely needed) would probably be in the tens of thousands). Looks as if a tear down developer may have bought it. Probably just as well that you passed it by.
MM $350/SF, wow.
Ace-I agree with you that house looks like it needed a ton of work 100K+. I also agree with you that it will likely be either a tear down or a flipper that is going to put a lot of cash into it.
MM, here's another not-so-immune sale for you:Chain Bridge Forest2010 tax assess: $1.178 mill.Selling price (net): $952K
Ace-Do you find that house a surprising price. It appears lower than I would have expected. The house looks like it is in decent shape and it is large on a large lot. I have seen similar houses in the Vienna/Dunn Loring area go for a similar price...
MM, That townhouse is still in a premium location with all of the high end accoutrements. I think that price is probably very reasonable.As for the home in 22207. I think this is a pretty typical sale given the condition of the house and the fact that Arlington has pulled back some. I don't quite understand why so many people are waiting for Arlington to implode. That's about as big as it'll get in my opinion.My $0.02
MM,A good comparable for the house you listed:http://franklymls.com/AR7494773I would expect this to fetch $515-535k.Just a guess though.My $0.02
just a data point -- we bought our place last winter. Are in the process of refinancing. It is a short walk to metro in N. Arlington.Bank appraisal price this month came in $15K over the appraisal one year ago (which was already 14K over what we paid for the place.)We were forced by events to buy the place but we are glad we did when we did. Have not seen similarly sized house for similar price since then.Just one data point in the broader market.
Wanting to move,I had the same experience. Bought a place last fall for 5% below appraisal. This year during a refi it assessed another 4% higher than that. Of course, both of those values are still slightly shy of what Arlington is taxing me at, but, well death and taxes and all...My $0.02
Interesting. We actually had our place re-assessed because Arlington had recorded the wrong square footage. The assessment put it at about the same figure as last year's appraisal, if I remember correctly.(The purchase price was below the previous assessment value.)
Sorry for confusion -- DCgirl and Wanting to move are both me. I had some trouble logging in in the past and just made a separate account. So confusing, this internet.
HB, after the fact, of course I can say anything, but I would say only a small bit surprised, because (a) it seems to back to a noisy, busy street, and (b) the house looks very dated (even if it were updated, it would still have a late 70s/early 80s vibe from the outside). My opinion is that, in this range, buyers expect the house to look current as well as to have new systems, and this often requires a ton of money, esp. for a good-sized house. Sellers of houses like this are often nearing retirement age and may have very different tastes than the 30-something buyers in Arl. To get an idea of what these buyers want, just look at the Craftsman style of the new builds. This difference may not hold for other areas, such as Dunn Loring or other parts of Fairfax.In this case, it's not just style but also substance that is probably keeping the value down.So I know this is a tired refrain, but for many (most?) of Arlington houses (possibly the true immuno-area of Lyon Village is an exception) the price increases of the bubble decade reflect a substantial component of real value increase reflecting $$$ invested by owners. Houses that haven't kept up, or can't be changed to appeal to most buyers in a given price range (without huge cost), have significantly less value.(By the way, I went to an open house of a contemporary this weekend and another person there said, "wow, this is so unusual for Arlington - aren't you sick to death of all the Craftsmans?" Ha!)
PS, don't want to speak for VA_I here, but I think she would point out that this may be another result of really bad initial pricing strategy.They also probably should have removed all the security bars on the doors and windows--probably had a break-in years ago, but this would worry buyers. Houses that are on or back to busy streets (except highways) seem to be more vulnerable to this than other houses close by but not on the main drag. And even though that's now a very safe neighborhood, it might have reinforced concerns in the minds of some buyers.
2 cents Not so sure that house on Harrison is a good comp for the house on Vernon. The house on Harrison backs to the WETA radio tower and that part of Harrison near the shopping center is very busy. The house on Vernon is on a hill but was bought by a builder as a tear down. His sign is already up in the front yard. There have been other nice new construction houses on that very quiet part of Vernon St.
pat,I doubt many LL's (slumlords or rent barons) spend much time commuting to rental properties or meeting repairmen.I'm quite sure I am not alone in having trusted contractors that I have used for years. Tenants are required to meet them or leave a key.I do meet with contractors when I have a substantial renovation going on, but certainly not a clogged drain (which, by the way, tenants are responsible for - read your lease).I wouldn't own property in Woodbridge or any place else that wasn't close by or didn't attract the type of tenants I desire.Would I have flipped those type of properties? Sure.The fact that you have been looking for your desired property for two+ years would suggest that you are correct in believing that they are scarce.
I wish more people went with pricing strategies like this. Every few weeks they are dropping the price by $50k (~7%). I assume at the current price it should be able to find someone willing to overlook the less than ideal location (only a few trees between it and commercial spaces and parking lots)
housebuyer,that's a beautiful house! have you seen it in person?
MM-I agree the house looks really nice. I keep on being surprised when the house doesn't sell and they lower the price... I have not seen the house, I still have over a year on my lease so I am not visiting any houses at this point.
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