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.
According to Zillow, re best performing cities of the decade, we're number 1! (And 3.)
newbie-I wonder what the criteria was to be ranked. I would have expected to see a bunch of additional cities in this area (e.g. Falls Church, Fairfax, and a bunch of Maryland cities).With DC the best performing MSA in the CS index its not much of a surprise that Zillow says the same thing.
For a slightly more nuanced view Buy vs Rent i like the line, 3 years after the crash and purchasing a house remains a fairly marginal decision. DC is in the uncertain zone. which is probably why the disputes are so nasty. But, it indicates to me, the market remains inflated. Increases of 9% a year, while incomes were stagnant in the MSA.
"It’s pretty amazing when you think about it. The country has suffered through a terrible crash in home prices, yet buying a house remains an iffy proposition in many markets."
Pat-The 9% number is for the district where incomes went from 40.1K in 2000 to 59.3K in 2009. This is almost a 50% increase in 9 years, which I would hardly call stagnant.I am pretty sure the total MSA income went up ~25%, which is obviously less than housing costs, but is also definitely not stagnant.
2 years on and off market, bought for 355, now UC near 200K. Dumpy and cruddy. this is what we call shadow inventory.foreclosed in 08, flashes in and out of the market since 09.
HBIt's still unstable.split it out. 5%/Annum income growth, 9%/Annum House cost increase.Tell me how that is sustainable, or do the math.House prices increased 40% more then incomes.... Either fewer people can buy houses or they all buy whacky mortgages.
"Pat said...Tell me how that is sustainable, or do the math."Its simple. Suppose for simpliciticys sake, there were 7 people in DC in the year 2000, whose incomes were as follows:30K30K30K50K100K100K100KIn this case, the median income =50K. Also, assume were 7 houses (mostly bought at 3X income) prices would be as follows:90K90K90K150K300K300K300KHere median price =150K. So we have median income =50K and median price =150K, everything hunky dory right? Good.Now, assume 4 more people move in, 2 making 30K and 2 making 100K. If so, the income distribution is now 30K30K30K30K30K50K100K100K100K100K100KHere again, median income is still 50K. HOWEVER, since this is DC we are talking about -- since this is not Fairfax or Loudoun where they can just build 4 more houses in empty land to keep everything in equilibrium -- suppose that since they are out of land, they just cant build. So what happens as those 11 people compete for the 7 existing houses? When this happens, (again everyone purchases at 3X income) prices are as follows:90K150K300K300K300K300K300KNow, median home price is 300K. The 4 other poorest people are now forced to rent.So again, to recap in the beginning median income = 50Kmedian price = 150KAfter people move inmedian income = 50Kmedian price =300KAgain, look at the example -- no one purchased at more than 3X income yet prices still (sustainably) rose 100% while incomes didnt increase at all.So on the surface, someone will look at the 0% increase in income and the 100% increase in prices and scream "HOW IS THIS SUSTAINABLE...PRICES WILL CRASH". Sadly for that person, he didnt look at places like NYC where (thanks to land constraints) prices are now 20X income and not in the slightest bit unsustainable. Sadly, he just didnt look at the realities facing facing land constrained areas like DC and realize that some people are destined to be priced out forever.
Pat, To me what is interesting is how resistant neighborhoods like one where you found the duplex in 22204, Arlandria, etc., have been thus far to gentrification by well-heeled yuppies and investors. Yes, it would take people with courage, tolerance, skill and other qualities, as well as $, and they could get burned, to turn it around. But given the proximity to DC, to amenities, and to nice areas, and given the huge increase in prices in more "established" areas, I'm surprised more upper income people haven't swept in.
AnonWonderful Example, Clear, Lucid, Simple....Oh, Yeah, utterly Ballocks.You see, while your example makes a great example for a drooling right wing email, it's not backed up by something we in the real world call DATA. DATA "One in five renters and one in seven homeowners in the Washington area spend more than half their income on housing, according to census figures, a proportion that housing experts consider a severe burden"So, Um, why don't read some Data.
AnonLet me try and point out a basic error in your example. I'll assume you are just a little thick and didn't try and be duplicitous.You assume that the houses are all the same.you price the houses at 90K, 150K and 300K.Let us assume the same Price per SF.and set $/SF at $100.That makes the 90K 900 SF, the 1501500SF and the 300K 3000 SF. That would translate into a small 2/1 Townhouse, a small SF 3/2 house and a 4/3 Larger house with Garage.In your example, people wildly overpay for the lower end houses.Somebody paid $300K for a 2/1 Townhouse in Arlandria. Oh, Yeah, People did that in the bubble.Thank you for proving my case.
You see, while your example makes a great example for a drooling right wing email, it's not backed up by something we in the real world call DATA.Classy Pat. Let's have another show of hands for a social?.....................................................................................Yeah. That's what I thought.tsk tsk.
TNgiven the article i cited had been inthe blog when it came out, it is basic information.When someone makes up a story instead of using data, it's very childish and very foolish.I called him on it.I know people like anecdotes and whacky little fables to justify their political leanings, but, it's a reason why this country is deteriorating.And if Anon can't man up to a little criticism when I point out a logical fallacy, it says a lot about him.
So what's this?NOTICE OF TRUSTEE'S SALE 721 South Glebe RoadNOTICE OF TRUSTEE'S SALE 721 South Glebe Road Arlington, VA, 22204 By virtue of the power and authority contained in a Deed of Trust dated January 26, 2007, and recorded in Deed Book 4066, Page 2171 in the Clerk's Office for the Circuit Court for Arlington County, VA, securing a loan which was originally $428,000.00. The appointed TRUSTEE, Commonwealth Trustees will offer for sale at public auction at the front steps of the Circuit Court for Arlington County, Virginia, 1425 North Courthouse Road, Arlington, VA 22201 onJanuary 3, 2011 at 1:30 PM improved real property, with an abbreviated legal description of The southerly fifty (50) feet of Lot Three (3), in a subdivision made by John P. Mann, recorded in Deed Book 200 at page 156 of the Land records of Arlington County, Virginia., and as more fully described in the aforesaid Deed of Trust.TERMS OF SALE: The property will be sold "AS IS," WITHOUT REPRESENTATION OR WARRANTY OF ANY KIND. A deposit of $45,000.00 in cash or cashier's check payable to the TRUSTEE will be required at the time of sale. The balance of the purchase price, with interest at the rate contained in the Deed of Trust Note from the date of sale to the date said funds are received in the office of the TRUSTEE, will be due within fifteen (15) days of sale. In the event of default by the successful bidder, the entire deposit shall be forfeited and applied to the costs and expenses of sale and Trustee's fee. All other public charges or assessments, including real property taxes, water/sewer charges, ground rent, condo/HOA dues or assessments, whether incurred prior to or after the sale, and all other costs incident to settlement to be paid by the purchaser. In the event taxes, any other public charges or condo/HOA fees have been advanced, a credit will be due to the seller, to be adjusted from the date of sale at the time of settlement. Purchaser agrees to pay the Seller's attorneys at settlement, a fee of $295.00 for review of the settlement documents.Additional terms will be announced at the time of sale and the successful bidder will be required to execute and deliver to the Substitute Trustees a memorandum or contract of the sale at the conclusion of bidding.(Will the Trustee auto bid $450Kto clear the note? All i can think is he did some sort of cash out refi. spanish fella, bought it in 97, for 156, and now it's NOTS)
NOTICE OF TRUSTEE'S SALE 721 South Glebe RoadNOTICE OF TRUSTEE'S SALE 721 South Glebe Road Arlington, VA, 22204 By virtue of the power and authority contained in a Deed of Trust dated January 26, 2007, and recorded in Deed Book 4066, Page 2171 in the Clerk's Office for the Circuit Court for Arlington County, VA, securing a loan which was originally $428,000.00.So is the trustee required to bid 428KIf so, it sure won't sell for that.
dude i was so going to put that up.what i find interesting, is if VA can do a foreclosure in 2 weeks non-judicially and they have almost no roadblocks, why have the banks been screwing around with inventory other then to manage the market.
"Pat said...I called him on it."You didnt call me out on anything Pat.What I just went through is an example that we had discussed here for YEARS -- forward and backward, backward and forward -- and the best part about it, it was proposed by a bear (Novawatcher). Oh and as for the data -- again your newness shines through. When we found the ACS census data, CRT & Cara blew people away by discussing the minutae about groups and subgroups of people moving in to particular counties, based on income, marital status, race, educational attainment. ALL of that data pointed out that not only is the example possible, its very very likely based upon the data. In any event, judging on the time stamps of your posts, it looks like you went on another late night emotion filled bender, so its best not to be to harsh on you til youve had some time to think, and I mean really think about this example. If you do, I can assure you you will decide what we all did when it was proposed by the bear, Novawatcher -- its flawless.That said, if you still do not understand, I will try to point you to those discussions of yore were we all collectively were shown how this was not only possible but likely happening in front of our very eyes.Merry Christmas!
Pat and Ace The Virginia Highlands and adjoining Columbia Forest neighborhoods were the most affected areas in Arlington for many short sales and some foreclosures. The many apartments that bordered the areas were loaded with emigres who thought they were rich during the construction and service industry boom in the early 2000s. They were ignorant and trusted their slick countrymen who fooled them into buying nearby housing they could not afford with first and second trusts they did not understand. When the construction jobs stopped, the people who were renting the basement cubicles (most single men) could not pay the rent, the owners (most construction worker husband and service industry wife with children)did not have that extra income from the renters or the husband and could no longer pay mortgages. Short sales were first then foreclosures on what was left. Rich(er) people did swoop into the area either in the form of investors who flipped or kept the properties as rentals. A number of young people with jobs, but not necessarily rich, did buy the short sales. They are slowly fixing them up. I remember MM was looking at a place in Columbia Forest and asking for opinions. Some emigres (mostly the cab drivers) held on and they are still there with refinanced loans service groups helped them put together. The people involved in the short sales moved back to the apartments using the wife's salary. It was more stable as they were more often cleaning people, nannies or worked in the schools. It takes a while to put a neighborhood back, so I think you won't see big progress in that area for 20 years or so. The other variable in that area is the four old Arlington families that own many of the red brick apartments around Columbia Pike and a lot of the commercial land that fronts the pike. As they slowly sell off, different types of housing can be built and that will get the ball rolling in 22204
Thank you, Reecon, for an informative post. It will be interesting to see how the process evolves.Pat, I don't mean to pile on, but I'm about as far from the right wing as possible while still basically believing in markets (competently regulated ones, that is), and I think The Anonymous' example is very good, and I certainly didn't think he had evil intentions of any type. FWIW. Hang in there, your house will turn up soon.Peace and prosperity to all for the holiday and throughout 2011.
risk of sounding like a whiner i feel the wealth gap in general has worsen and RE market the worst - probably one of the reasons why N Arl becomes more expensive while S Arl can't catch a break, even with the similar or better proximity to DC (same can be said to NW DC & the rest of DC). sorry Ace i don't think there's much hope for S Arl until the cable cars are proven to be a safe and clean alternative to get through sketchy neighborhoods. and that's not even consider the performance gap between the schools
MM, yes, I think those are valid points, except:1) there are many other areas where those in the true "lower economic classes" can choose to live, and do; to the extent that The Anon's analysis is correct the geographic advantages of certain Arl. areas should loom larger as the disparity in prices grows and population grows;2) that I believe the difference in "performance" of the schools is largely because of the demographics of the students who attend there, and to a lesser extent the facilities at Wakefield High School. The quality of the teachers I know who work or retired from there is just as good as that in other Arl. schools. The facilities will be addressed because the bond issue to rebuild/renovate the school passed resoundingly last fall. So the demographics remain a chicken-egg issue. If 22204 and 22206 gentrify further (and there are already some great neighborhoods there) more advantaged and English-as-first language children will form a larger proportion of the student population, and the "performance" of the school will increase. By the way there was a large increase in scores this past year at Wakefield; not so at the other Arl. HSs. I don't know as much about the elementary schools because I don't have any friends who teach there, but my hunch would be much of the same would be true for them.
Ace,very true re: chicken-egg issue; competitive kids make schools more competitive; well-off buyers make neighborhoods more expensive.
AnonTry doing something called math.What it says is that somebody to meet your example pays $300/SF to buy a low end unit, so what that does is trip off a massive price escalation.Where before units were priced based upon size now the price gets really nutty especially at the low end.A proper pricing should be sloped, with bigger units commanding higher price per SF, that should reflect desirability of area as well.Instead your example shows the inherent instability.Someone got crazy, bought too much, and when they go down destroy valuation for everyone.Look at housing data for the sixties and seventies.Million dollar houses were big places, lots of land, lots of house. When the bubble started, prices got all inverted with people paying way too much per SF particularly at the low end.The people you pity as renters may well have done better.Depending when they entered.
here's an odd one the assessed value is 430K, it sells for 380K. but look at the land records.Citi mortgage seized it for 208K.Will they send 210K minus costs tothe owner? were their second trust deeds?and it was bougt in 97 for 197K. Did someone do an equity extract and have a second mortgage or HELOC city?
Post a Comment
Subscribe in a reader