Northern Virginia's February 2011 housing sales were down 8.4% YoY, and median prices were up 2.7%. The average days on the market increased by 47% to 75 days.
(The above statistics include Alexandria City, Arlington County, Fairfax City, Fairfax County, Falls Church City, Fauquier County, Loudoun County, Manassas City, Manassas Park City, and Prince William County).
Source: MRIS
Thursday, March 10, 2011
Northern Virginia February Housing Sales
Posted by Harriet at 12:10 PM
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21 comments:
"pat said...
I am Sure Anon will accuse various con-artists and Hustlers of doom-selling for noticing that the interior suburbs are now at the same Inventory level as during the Crisis.
The outer burbs appear to be rising but not as bad. They had their Subprime Implosion, now their Prime Implosion is happening much more weakly in the outer burbs.
The inner burbs never had a subprime inventory but now the Alt-A and Prime runup is happening.
10/11/10 2:42 PM"
Inner burb watchers -- beware the Alt A and Prime implosion!!! No place is different -30% to -40% off peak prices is coming soon to a neighborhood near you. Glug, glug, glug, glug, glug...
I know DC has outperformed the markets for a really long time, but for most of the past 10 years the direction has been the same. (sure DC goes up more when the market is going up, and down less when it is going down), but the last 6 months seem to be different. The national market is taking a beating and DC is not being touched at all. Corelogic just came out saying that nationally prices were down 2.5% in January, I will be interested to see if we can finally get a negative 0.5%-1% print in January. So far our housing market has been stronger than I expected and am interested to see if it can continue to do well as other markets continue to take the pain.
Anon
What's going on in Culpeper and Fauqier? Ratios of 300?
at the end of the day, I use very simple tests. Rental yield, Price/Income, Replacement costs.
Look at CRT's wonderful stats. PG has almost completely shed the bubble.
Arlington, Alexandria, DC are almost within 8% of bubble prices.
Montgomery, Fairfax, are still way up.
Have incomes tripled in those counties in the last 3 years?
hb,
The Center For Regional Analysis at George Mason has some really good, detailed data, charts and projections.
I skimmed thru a couple of their presentations. They pull together alot of data and it is interesting to look back at past recessions.
About half-way thru they finish the National picture and drill in on our region - even spliting off DC, NoVa and MD suburbs.
The data sources are quite sound. I'd have to go thru past forecasts to have an idea of how accurate the future ones are.
VA_I
"You should consider a apples to apples comparison"
I rent a 2BR/1Ba for 1035 plus utilities.
http://dc.urbanturf.com/articles/blog/jbg_to_convert_myerton_apartments_to_condos/2957
"Sales are expected to begin in early March with one-bedrooms starting at $244,900 and two-bedrooms at $294,900. "
so I can buy a 2BR/1Ba for $300K,
so that's $1700 PI plus TI takes me to $2K plus HOA. Plus I get a pool, Gym and Dishwasher/W/D. Negatives, I get Black Mold. The comments there are hysterical.
In order for a Condo to match up to my current rent I figure it should max out at a 2BR for 150K.
Pat-
There are a lot of condos in that price range condo 1 this is listed at 139K the condo fee is very high but includes utilities. My guess is it is also a lot more updated than your current place.
Here is another place TH for 185K
place # 3
I only looked for a couple of minutes so I am sure these places aren't the best example.
hb,
I've come to the conclusion that some people may be bending over backwards to justify not buying. It may serve some "need".
Coming here to get reinforcement? There are a ton of very affordable places on the market. I doubt expections will ever meet reality in some cases.
VA-
I agree. I think a lot of people compare their current situation with the cost of buying what they would like to live in not the cost of buying a comparable place. I know when I buy instead of paying 1900 a month I will be paying 3-4K. Maybe 200-300/month is because it is cheaper to rent than own, but most of the increase is because instead of living in a 1K sq.ft. condo I will have a 2500+ sq.ft. TH or SFH.
I find this a really depressing chart. It really shows how bad people are at saving money. 40 years ago people had ~70 equity in there houses now they have about half of this. I also find it incredible that during the bubble people were spending equity as quickly as they got it... Ohh well hopefully people will become more responsible over the next several decades.
"VAI said...
I doubt expections will ever meet reality in some cases."
Agreed. Its a sad fact, but if there is not enough of a resource such that everyone who wants it can have it, pricing will be the mechanism whereby the most bearish will always be "priced out forever".
Case in point is Contrarian. He expected a 90% fall, which will not happen. Unless he adjusts his expectations, he will be priced out forever.
Likewise is Pat. While he is nowhere near as extreme as contrarian, he is still outside the norm, even on this blog, which runs more conservative than the actual market. He sticks hard and fast to "rules of thumb" even after being shown, again and again, and again, why those "rules of thumb" do not always work, and in some cases, have not worked for decades. Still, he remains resolute, convinced if he hangs in there, long enough, it will happen.
Eventually, he will have to adjust his expectations to reality. If he does not, he too will have been priced out forever.
Honestly, this may not be a bad outcome for him. If he can continue to get a rent that low, he should be content with the prospect of just renting forever. There is nothing wrong with this. In cities like New York, people of all economic strata do it all the time. Likewise, it is the standard in much Europe. I would not be surprised if it becomes more and more common around this area too.
Anon,
I think Pat's mistake is equating his situation as the norm, and requiring purchase parity to meet his specific rent.
Most of his competition for those 2 bedroom, 1 bath condos, in the nicer areas are going to be couples living in the same relative size 1 or 2 bedroom apartments paying anywhere from 1700-2500 depending on their amenities and location.
I had an awesome 2 bedroom, SFH, with off street parking barely a 1/4 mile from the Ballston metro for about $1200 per month for the longest time. For me, it was essentially impossible to match that situation apples to apples with a purchase. However, it was just as disengenuous for people to tell me I was throwing rent away as it was for me to expect to find the same thing owning.
My $0.02
0.02
If i can rent for half the price of a condo, i'm happy. I'm very happy.
Anon
Rules of Thumb exist for a reason
HB
That low equity should be a huge concern. Given a third of houses are owned free and clear, the other 70% have 10% equity.
That scenario ends badly.
pat,
There is nothing wrong with renting. I do believe that your expectations are unreasonable and that you compare apples to oranges.
Article in today's WaPo indicates that regional job creation is somewhat encouraging:
"Employment data generally good in region, but Md. shows weakness"
Pat,
I would say rules of thumb are good first order approximations not the end all be all determinant of a situation.
My $0.02
Let's see if this deal pencils out.
http://www.apartmentsearch.com/apartments/virginia/arlington/the-myerton-apartments.html
According to Apartment search.com,
2BR/1 Units were 1655-3065/month.
Now what explains that swing? I guess
the views and the SF.
According to the Press Release they will be selling 2BRs starting at 294K
So Figure the 1655 is the rent they were hoping to get for the small Plans and the 294K price is the sales price, let's see if this makes any sense
okay rent at 1655 is a 6% yield, not great, but not pathetic either.
Okay using a 30 year mortgage and 5.5% Interest, i get a PI of 1669.
I get Taxes of 211 and insurance of 211. Now what's the Condo Fee?
I don't know as it's a restart of a failed condo, but the average Condo Fee in NoVa runs 398/month http://blog.brianblock.com/public/item/232293 which does include utilities,
So people were renting there last year for 1655 and they have the opportunity to buy for 2500?
Now here I've laid out my assumptions, so please if i've made an error, point them out. Laughing and pointing is acceptable.
BTW, when they first started leasing, they were giving 10% rent discounts so, the rent isn't even
a solid baseline.
Cheryl, Can you make this deal pencil out?
Harriet
Is it just me or is PW, Fauqier and Stafford back to 2002 pricing?
Pat,
I think your insurance estimate is off by an order of magnitude and your tax could probably be 250 (I typically use 1% of purchase price as a guideline). I would say $275/month for taxes and insurance.
Also, I would guess that at least $1200 of the P&I is interest which means most would see a tax refund of $400 per month.
So adjust your estimates I peg this as $2345/month with an after tax cost of $1945 per month.
Is $290 over renting worth it? You also don't consider a 10-20% down payment which could significantly reduce this number.
My $0.02
I don't post much anymore now that I am comfortably nesting in my SFH purchased last year. None-the-less, I still read this blog every day.
Thanks for the urbanturf link Pat. I was unaware of it and will bookmark it.
Can anyone recommend a useful site for DCMetro area Maryland? I have searched but only found self-serving realtor blogs thus far.
The reason I ask is that in my current job I also provide real estate and rental advice to a lot of hopefuls moving to the area from out of state. I have drawn heavily on my own experience and the recommendations I find here.
Suggestions are welcome.
0.02
According to the AC treasurer, property taxes are $.865/$100,
which is slightly less then 1% but,
I guess i'm used to midwestern Insurance which is just brutal 1% of property value of course the sky opens up and kills whole cities out there, so, it's worse.
if you think the Insurance is too high, i'd adjust...
but it's still a 20% premium to rent? a 20% premium for Black Mold?
lets see, if rents' increase 4% a year, it takes 5 years to break even.
Meanwhile if Long term interest rates go up 2%, your property value goes down 20%....
Look, and I know Anon will go Ape when I say this, but Owning is supposed to be cheaper then renting.
That way you own for 5 years and it amortizes the transaction costs.
nstead you pay a premium to own at Myerton and a dozen other places.
So i'm building a garden for my landlady.
"Owning is supposed to be cheaper than renting"
I don't even know where to start...2% interest rates increase means a 20% drop in value?? Huh? Got data?
Too late to go into this.
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